Geoscience data value, cost and management in the oil industry

Abstract

Abstract BP Exploration, through its Frontier and International division (XFI), is the first oil major to openly release some of its international exploration data, information and internal reports to competitors for cash. The data and information relate to geographical areas in which the company foresees no strategic interest. There are various ways in which such a programme could be run. In our case, all exploration information and data have an identified owner, usually the asset manager responsible for exploration in the relevant part of the world. A dedicated XFI data broking team identifies and prices material for possible exchange or licence sale. The asset manager who owns the material certifies whether it may be released without damage to the company’s competitive position. Legal staff check the ownership of the material, and ensure that there are no confidentiality constraints. Commercial brokers then either offer released material to the open market or create new products from it for licencing. The material is licenced for use rather than sold, so that the recipient cannot re-sell it. All income accrues centrally to XFI rather than to the asset manager; altruism by the owners of the data is central to our data brokerage philosophy. Such marketing follows naturally from treating data and information as a true asset, whose value can be established in the market-place. When such marketing becomes the industry standard, then XFI can also enter the market-place as a buyer. Those who can buy existing exploration data and information will save the great cost of generating their own. This is part of a sea-change in the industry, in which the players are moving towards a lower cost base through shared activity as opposed to duplicated activity.