Comparative Analysis of Full-Cycle Cost of Oil and Gas Exploration, Development and Production World-Wide

Abstract

Understanding the full-cycle cost of oil and gas exploration, development, and production is critical for petroleum producers and all players in the oil and gas industry. In particular, full-cycle cost assessment is used for corporate planning, acquisitions, operational improvements, project control, and risk management. The challenge is to ensure that full-cycle cost assessment is done accurately and on a consistent basis across different jurisdictions, companies, and geographic areas. Without knowing the full-cycle cost on a consistent basis worldwide, it is impossible to assess capital investment, forecast production from different areas, forecast prices, or assess other factors influencing the world market for oil and gas. This paper discusses the methodology for and the results of full-cycle cost assessment worldwide. This paper describes a methodology for full-cycle cost assessment that ensures data quality and consistency. It also provides examples of full-cycle cost assessment for major projects worldwide. The results of analysis help to predict long-term pricing trends, determine areas where production will grow or decline, and estimate capital expenditure in the next 10–20 years based on the most recent and most consistent data.