Narrated Slideshow: neoSCAN Keeps Explorers Exploring

NS-neoSCAN

Low oil prices and tight budgets don’t mean you need to stop exploring. NEOS recently announced the launch of its second generation neoSCAN™ solution (click here to read the press release), an offering designed to keep explorers exploring even in a $50 oil world.

Requiring no new data acquisition, the neoSCAN helps you get the most out of your legacy G&G investments by integrating existing data you already have with additional multi-physics datasets that can be quickly and inexpensively obtained from a variety of sources.

The datasets that are integrated and interpreted on a neoSCAN project include:

In < 100 days and for < 50 cents per acre, neoSCANs deliver the interpretive products you need to keep exploring, including 3-D subsurface models, maps of faults and intrusives, and maps of basement topography and composition.

Perhaps best of all, predictive analytics methods are applied on all neoSCAN projects, providing rich insights into the G&G attribute suites that are associated with nearby fields or known sweet spots, insights that can be used to highgrade acreage in underexplored areas.

The interpretive products generated on a neoSCAN typically include:

  • Assessments of basin-scale geologic trends
  • Maps of basin architecture and regional structure
  • Maps of key lineaments, regional fault systems, and intrusives
  • 2-D and 3-D structural and stratigraphic models
  • Maps of basement topography, faulting and composition, and the role these geologic features played in field location and type (gas vs. oil)
  • Assessments of relative acreage prospectivity derived using predictive analytics.

A neoSCAN project can be executed either onshore or offshore and for either conventional or unconventional shale plays.

Typical areas of investigation range from 2,000 to 6,000 square miles (~5,000 – 15,000 square-kilometers), although some projects have been scoped and delivered at the country scale.

Even in a $50 oil price world, the neoSCAN allows geoscientists to continue assessing the hydrocarbon prospectivity of large areas such that, when opportunities for acreage or corporate acquisition present themselves, or the commodity cycle turns to the upside, they’ll have the insights they need to deliver.

To learn more about the neoSCAN, click here or on the image above to watch the narrated slideshow. Or read more about the neoSCAN on the NEOS website.

Oil Price Impacts on Offshore Drilling

Fleet Status for Diamond Offshore Red Lines = Recently Cancelled Rigs; Purple Rectangles = Stacked or Unutilized Rigs

Fleet Status for Diamond Offshore
Red Lines = Recently Cancelled Rigs; Purple Rectangles = Stacked or Unutilized Rigs

I ran across an interesting article the other day that highlighted some of the impacts the recent oil price decline and budget cuts have had on the offshore drilling market.  It got me curious, so I pulled up the 10-K for Diamond Offshore (one of the largest offshore drilling contractors) which was referenced in the article.

It’s pretty amazing (and scary!) stuff.  The chart above shows the fleet status for DO. Excluding rigs under construction, DO has a total of 36 rigs: 18 (ultra)deepwater; 12 semi-submersibles; and 6 jack-ups.

Out of the 36, they have just received cancellations on six rigs (shown with the red cross-hatched lines) and have another nine rigs (shown with the purple boxes) that are either stacked, in the process of being stacked, or looking for work.  That’s 15 rigs or 42% of their rig fleet that isn’t working.

In a prior life, my team and I were asked to look at a potential acquisition in the offshore drilling market. One thing we noted as part of the analysis – day-rates for the rigs essentially imploded once utilization in the market fell below ~85%.  That was a number of years ago, but I assume these pricing dynamics still apply.

Given that many offshore drillers took on signficant debt to fund the construction of new rigs (a couple years back, everyone was anticipating significant new demand), the offshore drillers are faced with a near perfect storm of new capacity coming into the market just as day rates and activity levels implode.

DO stock was down 8% today following the release of its 10-K. Transocean (whose CEO ‘retired’ last week) and several of the other offshore drillers suffered similar share price declines.

So this isn’t just a ‘shale thing’ – all parts of the E&P business are being affected.

neoSCAN in Action: Athabasca Uranium Deposits, Canada

Claim holdings in the Athabasca Basin, Saskatchewan, Canada

Claim holdings in the Athabasca Basin, Saskatchewan, Canada

The Athabasca Basin is a 100,000 km2 region of northern Saskatchewan, Canada that is home to the world’s leading source of high-grade uranium. The basin is filled with sandstone sediment varying from 100 to 1,000 metres in depth. The uranium ore is mostly found at the base of this sandstone, at the point where it meets the basement.

NEOS will be presenting the results of a recent neoSCAN study covering the uranium deposits of the Athabasca Basin at the Prospectors & Developers Association of Canada (PDAC) annual conference next week in Toronto.  The PDAC exists to promote a responsible, vibrant and sustainable Canadian mineral exploration and development sector and is perhaps best known for its annual convention, which last year attracted 25,122 attendees from 103 countries.

NEOS was invited to present at PDAC 2015 by Geosoft® Inc., a leading provider of integrated geoscience software for mapping and modeling the Earth’s subsurface.  In the PDAC presentation, NEOS plans to share techniques it has been using in oil & gas exploration – focusing especially on basement mapping and predictive analytics methods – with geoscientists involved in minerals exploration and development.

To demonstrate the application of these techniques in the mining sector, NEOS undertook a neoSCAN study of a portion of the Athabasca Basin for which it integrated and simultaneously interpreted several existing geological and geophysical datasets to map key regional geologic features in a 17,000 km2 area of investigation.

The legacy geo-datasets that NEOS analyzed included gravity, magnetic, electromagnetic and radiometric as well as sub-sets of available geologic information.  Intermediate interpretive products including fault density and basement burial-depth maps were also generated and subsequently analyzed using predictive analytics techniques.

Dr. Craig Beasley, Chief Science Officer for NEOS, commented,

“In under a month, we were able to identify some of the key G&G attributes that correspond to the locations of Athabasca’s known uranium deposits. I think this demonstrates that an analysis of existing multi-physics data using advanced quantitative interpretation techniques can be a useful method for de-risking exploration acreage and improving discovery success, whether we are talking about the search for minerals or for oil & gas.”

To learn more about the neoSCAN as applied to acreage highgrading for uranium in Athabasca, click here (or on the image below) to watch the narrated slideshow.

AthabascaCover

NEOS’s domain expert on predictive analytics, Emmanuel (‘Manu’) Schnetzler, will be presenting the results of this Athabasca neoSCAN study, entitled, ‘Predictive Analytics of Multi-Disciplinary Data for Basin and Basement Studies,’ during the PDAC conference on Monday March 2nd at 10AM EST in Room 716 (Adopting Tools & Techniques from the Oil Patch session) at the Metro Toronto Convention Centre.

NEOS Releases Lebanon e-Brochure with First Look Data

Lebanon Ebrochure

NEOS has updated its comprehensive Lebanon neoBASIN eBrochure with First Look data. Click here or on the image above for access to the online brochure. For more information on our Lebanon neoBASIN program, visit the Global Programs page on the NEOS website.

 

The neoSCAN – Keeps Explorers Exploring in a $50 Oil World

With these prices, it will be difficult to justify a new acquisition program. We’ve got to make sense of all the data we already have!

This is an actual and recent quote from a Global Basin Studies manager at one of Europe’s most successful oil & gas exploration companies. And I’m sure he’s not the only one with this opinion.

In fact, during the last oil price bust (in 2008-09) some of us heard similar things at our former employer – a leading geophysical equipment, services and data library company.

At some level, who could disagree?  While the world is awash in oil at present, the oil & gas industry is awash in geo-data, and has been for some time.

But just having data isn’t enough. One needs to make sense of what all that data is saying.

Enter the neoSCAN™, a low-cost, high-value data integration and interpretation offering from NEOS designed to help you make sense of – and maximize the value of your legacy investments in – all your geo-data.

Said another way, NO NEW ACQUISITION REQUIRED!

neoSCANBenefits

The neoSCAN brings together legacy seismic, well, gravity, magnetic, remote sensing and many other multi-physics measurements in order to help you generate an integrated, 3-D, basement-to-surface understanding of large areas quickly and cost effectively.

In 100 days and for under $1 million (for areas of investigation up to 10,000 sqkm | 4000 sqmi), the neoSCAN will deliver many of the interpretive products you need to keep exploring:

  • 2-D structural & stratigraphic cross-sections
  • Regional 3-D subsurface models
  • Regional isopach & burial depth maps
  • Maps of basement topography and composition
  • Depth-to-basement maps
  • Basement-to-surface maps of lineaments & major faults
  • Regional resistivity models
  • Classified maps of multi-spectral data (lithology, IHIs)
  • Maps of relative acreage prospectivity
  • Identification of G&G attributes driving (un)favorable exploration potential.

By applying our proprietary predictive analytics methods to quantitatively assess all of this geo-data, we’ll help you highgrade acreage throughout your entire area of investigation.  Just like we did for this cost-conscious Global Basin Studies manager in his prospects onshore and offshore West Africa.  And just like we did for others in West Texas, the Mid-Continent, Oman, Jordan and other mature and frontier hydrocarbon provinces around the world.

Low prices and tight budgets don’t mean you need to stop exploring. The neoSCAN will help you get the most out of your legacy G&G investments by integrating existing data you already have in-house with additional multi-physics datasets that can be quickly and inexpensively obtained from a variety of sources.

So when things return to normal – or opportunities to capture assets from distressed players present themselves – you’ll be prepared with the insights needed to deliver.

Low prices. More insights. Keep on exploring with the neoSCAN.  To learn more, watch the narrated slideshow.

Biggest Weekly Rig Count Decline Since 2000

BHI Rig Count_02-13-201598 rigs were idled last week, the biggest weekly drop in the Baker Hughes Rig Count since 2000, with nearly half of that decline coming out of Texas alone!

And take a look at this interesting picture below from NAPE.  It shows the number of wells earning their cost of capital at $100 (upper left), $80, $60 and $40 per barrel (lower right).  You can see the amount of ‘color’ (i.e., wells) that fall by the wayside as prices fall.

Bakken Economics @ $40-100/bbl Oil (Courtesy Moyes @ NAPE)

Bakken Economics @ $40-100/bbl Oil (Courtesy Moyes @ NAPE)

Oil Prices: Is the Tide Turning?

In prior posts, we highlighted some of the reasons oil prices collapsed and, more importantly, opined on when we might begin to turn the corner.

Based on some of the most recent Baker Hughes Rig Count data, it looks like the process has begun.

Change in North America Land Rig Count (courtesy Baker Hughes)

Change in North America Land Rig Count (courtesy Baker Hughes)

Looking at the chart above, we see a dramatic fall off in the North American rig count over the last 10+ weeks.  We noted previously that many North American shale plays become uneconomic at prices below $60 per barrel and suggested that rig rates – and production rates – would rapidly decline in this price environment.  That’s just what we’re seeing, with North America having lost 526 rigs (23%) since the near-term peak (at 2,309 rigs) just before the fateful Thanksgiving Week OPEC meeting; in the last two weeks alone, 225 have been idled!

Source: Baker Hughes

Source: Baker Hughes

Baker Hughes also provides a series of nice cuts on the data, including how many rigs are drilling for oil (and gas) on a play-by-play basis.  If we take a look at six major oil basins – in which most rigs are drilling unconventional plays – the rig count is down by 286 (26%) since late November.  If we take 1,000 barrels per day as the average IP (initial production) rate for the average well in one of these plays and assume each rig can drill roughly one well per month, well that means we’ve already removed several hundred thousand barrels per day from the market (that would have otherwise been there).  Furthermore, not every well that is drilled is necessarily completed (frac’d) and brought on line, so this estimate of ‘lost oil’ to the market may be conservative.

I was curious about the international data too, shown below for our readers:

Source: Baker Hughes

Source: Baker Hughes

We’re looking over a longer time frame with the international data (going back to the start of 2014). In general, the rig count is fairly stable, except over the past few months where we’ve seen the onshore rigs especially begin to nosedive.

Since the July 2014 peak, onshore rig counts are down by nearly 10%. While the falloff isn’t as dramatic as it is in North America, we’re still seeing declines, albeit at a slower pace as many of these rigs are dedicated to larger, multi-well field development projects in which it’s much harder to scale back the drilling program once the field development plan is sanctioned.

Net-net, it looks like the market is behaving in a fairly rationale way.

Investors also seem to be thinking we might be reaching a bottom.  After falling by nearly 25% since late November, the oilfield services ETF (OIH, whose top 3 components – Schlumberger, Halliburton and National Oilwell Varco – account for nearly 40% of its value) is up nearly 10% from its bottom of just a couple of weeks ago.  As goes the rig count, so too goes OIH.

For those wondering about it’s peak – well, OIH traded around $58 in July 2014 and around $70 in 2008-09 before the global financial crisis.  If you have a value investing mindset similar to Warren Buffet and seek to buy when everyone else is selling, now might be an interesting time to bottom-fish and buy in!  Good luck…

OIH

First Look Data: Lebanon neoBASIN Program

LBN1stLookCover

NEOS has just released some First Look interpretive products from its Lebanon neoBASIN project. Originally scheduled for delivery in late March, the First Look products have actually been delivered to the project’s underwriters in early February, nearly 2 months ahead of schedule.

Click here (or on the image above) to access the narrated slideshow which contains the First Look products (on pages 26-31).  To learn more about the Lebanon project, visit the Global Programs page on the NEOS website.

NEOS Returns to NAPE with the Message: Keep Exploring Using MMI

NAPESummit_lapel pin(2)_v6_
NEOS is gearing up for the NAPE Summit next week.  And like many of you, we have one eye fixed on the market and the price of oil.  But we are not just watching.  We are finding ways we can help our customers keep exploring in this low-price environment.

Airborne-acquired, multi-measurement interpretation (MMI) is proving to be a valuable tool for progressive companies looking for new, less expensive ways to explore.  Take a look at our example of how MMI saved millions for one NEOS client.  Furthermore, by using existing data (either publicly available or your own), NEOS is able to highlight key geologic features and identify the most prospective locations for future exploration and development, and all within roughly 100 days.

We invite you to stop by the NEOS booth (#2958) to learn more about how MMI and airborne acquisition can save you money and time.

Amazing Satellite Images from Around the World

SatelliteShot

To see more of these satellite images, click here or on the image above.

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