Our exploration strategy is designed to deliver new resources that grow production, creating substantial value to Shell. We have extensive acreage in high-potential basins around the world and have had significant success discovering resources in them.
We draw on our extensive geological knowledge, deploy innovative technologies, get early access to new licences and focus on material opportunities – both near existing infrastructure and in promising new basins and plays. We continue to focus on cost-efficiency and making early decisions regarding a prospect’s potential.
Our exploration performance has been robust. Over the past five years, we have added discovered resources averaging more than 1.9 billion boe per year. Between 2009 and 2011 we added 7 billion boe including tight-gas resources.
During 2011, we participated in 417 successful exploration and appraisal wells drilled outside proved fields. They comprised 30 conventional and 161 tight-gas and tight-oil wells, and 226 appraisal wells near known fields. New proved reserves have been allocated to 197 of these wells.
Eleven notable new discoveries and appraisals were made during 2011. These are in Australia, Canada, China, French Guiana, Nigeria, the UK and the USA.
Shell continues to build on a strong legacy of innovative technology for exploration in deep water, near existing fields or infrastructure and – increasingly – in new tight-gas and liquids-rich shale opportunities. Our research centres develop concepts, algorithms and tools that are integrated with leading-edge technologies from the external market to enable the identification, appraisal and development of hydrocarbons in deeper and more complex geological settings with lower risk and cost.
We are a leader in the acquisition of seismic data in deep water by means of wide-azimuth surveys and ocean-bottom sensors. These technologies, when combined with proprietary processing algorithms, interpretation software and ever-greater computing power, allow us to create sharper seismic images of rock formations. We can then locate drilling targets in the formations more accurately. For onshore seismic acquisition in support of tight-gas and liquids-rich shale opportunities, we are developing innovative fibre-optic and magneto-electric sensor systems.
Advances in onshore well technology, such as Shell’s proprietary light land rig and lower drilling costs, allow us to develop and produce resources that were previously uneconomic. We have extended the concept of a light drilling rig to offshore operations, where we also have taken advantage of automation to reduce the rig crew’s exposure to hazards.
We have an outstanding safety record in drilling deep-water wells. We brought that expertise into the establishment of the Marine Well Containment Company, which provides containment systems for deep-water wells in the US Gulf of Mexico. In the shallower waters of Alaska, we will have a dedicated oil-spill capping and containment system designed to deal with Arctic conditions.
We are locating and draining previously stranded hydrocarbons near our existing offshore field infrastructure with record-setting wells that extend laterally for several miles from the drilling rig. We are also developing new techniques to understand and predict the distribution of heterogeneities in tight gas and liquids-rich shale reservoirs. This will enable us to confidently identify productive “sweet spots”.