AAPG Risk and Uncertainty Forum 2019: Q&A with Marc Bond
At the heart of every technical evaluation and investment decision lies the ability to accurately describe the full range of uncertainty and risk at all stages of the oil and gas industry life cycle, from basin entry, play and prospect evaluation through to appraisal, development and production decisions. Such analysis is standard good practice throughout project life cycle, yet the industry’s collective results suggest that these methods do not produce accurate forecasts of outcomes.
The American Association of Petroleum Geologists is running a Risk and Uncertainty Forum in Aberdeen, Scotland from 18 – 19 June, 2019. GEO ExPro spoke to Marc Bond, Co-chair of the Forum, to learn more about the issues which the meeting will address.
How did you get involved with this forum?
Neil Hodgson, AAPG Europe President informed me of the forum and asked me to chair it.
Do you think the industry is good at assessing risk and uncertainty?
Risk yes; uncertainty no. There is a lot of statistical and anecdotal evidence to support this assertion.
What are the major uncertainties when exploring for oil and gas?
To name just a few: resource estimation; production; cost; timing; commercial issues; political factors; commodity price.
What in your working experience has led you to this conclusion?
I worked as Head of Assurance at a major oil and gas company, which gave me plenty of insight into the topic.
At what stages in the E&P cycle are we not incorporating enough risk analysis?
What are the most important issues to be addressed?
Characterising uncertainty appropriately, ensuring that the predicted outcomes match the actual ones - and then communicating the risk and uncertainty appropriately to decision makers.
You are involved with the Risk Coordinators Workshop. What does that entail?
The Risk Coordinators Workshop is an event held twice a year (one in the US and one in the UK), where subsurface assurance coordinators and other like-minded individuals get together to discuss the challenges and issues they face, usually around risk and uncertainty, and seek solutions for better performance and best practice.
Is getting a better handle on the risks and uncertainties of a project an expensive process?
No; it should not be. It really involves reflective thinking, mitigating ones biases and being open to challenges and alternative scenarios.
Can we bring the experience from other industries to improve our handling of risk and uncertainty?
I think we should be able to do this. It is finding these industries and getting them willing to share that is the greatest challenge.
Are the greatest challenges to be answered through technology or through process?
Both are important. However, we already have these in place, and we are still not managing risk and uncertainty well. I think instead we should be looking for better ways of working together and understanding the challenges and reasons why we are not doing well, and then actively looking for solutions. The Risk and Uncertainty Forum is an excellent vehicle for doing this.
Who should attend this forum?
Certainly all technical individuals involved in the subsurface activities of the oil and gas industry throughout the lifecycle. However, I think management would also benefit greatly from attending. The format of the forum is designed to provide an interactive and integrated learning and sharing environment, with opportunities to network through a blend of keynote speakers, panel discussions and breakout sessions.
Further Reading on Risks & Uncertainties in Oil & Gas
Some recommended GEO ExPro reading relating to the risks and uncertainties involved in the exploration of oil and gas resources.
Potential Risks from Outdated Technology
Scot Rudolph, Director of Business Development, RiskPoynt
Embrace modern technologies to assure organisational and operational security.
This article appeared in Vol. 14, No. 6 - 2017
The Quantification of Uncertainty in Reservoir Management
New developments in history matching improve uncertainty quantification and risk assessment in reservoir management.
This article appeared in Vol. 11, No. 5 - 2014