What's New in Exploration
Does anyone in the television media know what E&P entities do, and what comprises energy companies? Here’s a recent CNN post: “Saudi Arabia and American shale oil companies remain in a battle for global dominance...Despite that rivalry, Saudi Arabia is deepening its ties with the U.S., with a raft of deals with American energy companies unveiled during President Trump’s visit to the OPEC leader...Saudi Aramco, the country’s oil crown jewel, announced $50 billion worth of agreements with nearly a dozen U.S.-based companies, including Schlumberger (SLB), Halliburton (HAL), General Electric (GE), Nabors (NBR) and National Oilwell Varco (NOV).”
The story has nothing to do with Sunni Saudis directly benefiting [evil] U.S. oil companies, but evidently only a handful of us understand that. Oil gets put into misinformation headlines a lot. I believe the President of the U.S. has been commenting about “FAKE” headlines from credited anonymous sources.
More than one actual oil company has been slandered in the news for what they did, or did not do, always defined by someone else. Shell Arctic’s exploration utility barge never sailed in the Arctic, but Shell was accused of gross environmental damage there (active tense). Who needs the facts, when you can make up fake oil news? So, I flakily report on a Greenpeace public land protest that I attribute to Arctic exploration, as taken from their photo, Fig. 1.
Greenpeace, Colorado, USA, May 2016: “Somewhere south of the Arctic Circle, numerous and unnamed protestors gather to express indignities toward oil extraction efforts by oil companies, under force of the government from areas held to the north of the protestors. The protestors agreed that the cleanest way to protect the climate was to keep the menace—“it”—in the ground, right before departing in carbon-producing vehicles.“
I remember being on Marajo Island in the mouth of the Amazon [Coordinates: 0°59′S 49°35′W / 0.983°S 49.583°W / –0.983; –49.583], when a certain [former] New York-based major announced news of fake oil discovered on the island, citing several billion barrels as possible. I failed to see rigs or anything resembling an oil crew. I did see cool-looking birds and some tiny piranha. The Brazilians were blamed for that announcement, as part of an ongoing World Bank credit issue. A year later, Brazil kicked out the oil cos. [me], nationalized the properties, and solved the World Bank investigation problem with a default.
Markets react to such announcements. The U.S. SEC requires public companies to publish annual evaluations of booked reserves on SEC Form 10K. So, we created proven undeveloped (PUD) and almost-PUD, and other devices, to express hope for activities planned, or in progress, that might or might not make the “Book.” Here, explorationists are under extreme pressure to find new reserves on paper. HOWEVER, we must tip-toe along with what is being stated. Be careful on listing “buy it, or drill here” versus the urges of a never-give-up-Mary-Poppins attitude that every well is, or will be, a winner. That presumption can get you fired, sued or worse.
There is now, more than ever, more legal risk in a prospect or project that simply did not exist even 10 years ago. We once relied on experience, a large staff of advisors, or just our gut before presenting risk to management to drill, or to management to agree to adding a [development] well to a budget. NO MORE! The Sarbanes–Oxley Act of 2002 has tightened the SEC noose; rightly so in my opinion.
How much oil and gas did you produce, sell and then report? Be careful, or be blamed for fake news of oil. It matters what you expected when you first went in, versus provable reality. All maps, email, conversations, and pre-drill estimates can be subpoenaed as evidence. Consider the tax law suits against oil cos. in Terrebonne Parish, La. Back taxes are allegedly due on quantity of production; but how to prove it to the penny either way? Who has the burden of proof?
Today, career risk is high, because stockholder patience is low, and litigation over misinformation is everywhere. Activist lawyers in the UK intend to sue Chevron, to stop further global warming, if Chevron continues to drill in the North Sea—you can’t make up this fake oil news stuff. Similar suits are threatened against Exxon Mobil. Lastly, there is the almost-endless filing of suits to stop Trump’s mere announcement to open exploration off the U.S. East Coast and Alaska. What happens when there is an actual ruling? There’s not even a hydrophone or diamond bit in the water yet, and the people in big black cars have the rock and water subsurface, benthic zoology, marine mammals, air quality and future climate temperatures measured [from models] for all events for the next 100 years. Who needs real data? Just plain bad news for us. 
