The usefulness of resource analysis in national economic planning—examples from the Norwegian Shelf

Abstract

Petroleum resources have an important influence on the economic life in Norway. To the official authorities it is therefore essential to have good detailed knowledge of these resources. Questions like “what are the total resources”, “how much of the resources have been produced” and “how much is expected to remain” should be answered. A classification system and an updated resource account is therefore required. Even though there is currently a well defined classification system and a resource acount which is annually updated, estimates of discovered resources are associated with considerable uncertainty for some field and discoveries. The uncertainties are not only connected to the mapping of field sizes but also to the possible potential for improved recovery, particularly in the light of new or sophisticated recovery methods. During the last two years the Norwegian Petroleum Directorate (NPD) has paid considerable attention to the potential for improved oil recovery. This is because of the time-critical aspects in the producing fields. The assessment of undiscovered resources also includes large uncertainties. However, regardless of the uncertainties such assessments are important for long term national planning. Decisions concerning opening of new areas for future exploration will have a considerable impact on the future level of the petroleum activities. To national authorities it is therefore important to have an understanding of what economic potential the undiscovered resources may represent. To resource analysts it will be important to know how the results from the geological assessment are used in the economic calculations. Different resource assessments of a single play model are compared, and a comparison between different prospect evaluations of one single prospect are also presented. This approach is used to focus on the most critical uncertainty factors.