Offshore oil: Investigating production parameters of fields of varying size, location and water depth

Abstract

This paper derives empirical estimates of field depletion level, depletion rate, decline rate and characteristic time intervals in offshore oil production based on a global field-by-field database containing 603 offshore oil fields. Statistical distributions as well as arithmetic and weighted averages of production parameters are derived for different categories of fields specified by size, location and water depth. A significant tendency of small fields having higher depletion and decline rates is found. Similarly, OECD countries generally have higher rates compared to non-OECD countries. Trends related to water depth are not clearly distinguishable and require additional investigation of time related aspects. Resulting spreads in derived parameter estimates are found to be well described by positively skewed probability distributions. Also, in line with theory, a strong correlation between depletion and decline rate is found. According to the study, the net share of global offshore production from smaller and deeper fields is increasing. A continuation of these trends would likely have implications for future aggregate offshore production behaviour, most notably, increasing global aggregate decline rates.