Geology, geography and global energy

Scientific and Technical Journal

Conditions of stable development of the exploration business. systematic approach to exploration project portfolio management. Conceptual model of the mechanism for the granting of rights of subsoil use for geological survey

2013. №2, pp. 143-164

Artem O. Brazhnikov - Applicant, Gubkin Russian State University of Oil and Gas, 400075, Russian Federation, Volgograd, Geophysicists passage 3,,

This article deals with risk management in the geological survey business, as well as aspects of creation of a legal environment for improving exploration industry effectiveness. In the article, the necessary conditions for the stable operation of a separate exploration company, are outlined. There are clear definitions of the concepts used in solving the problems of risk management. The algorithm, for making an oil and gas portfolio of projects, and a list of information necessary, for compiling the portfolio, is presented. The effectiveness of a systematic approach to managing risk, in the geological survey business, is shown, based on the example of the calculation of the minimum number of projects in the portfolio. Analysis of current system of subsoil use and analysis of its ability to solve governmental tasks of and rational subsoil use effectively, is performed. The necessity of redistribution of the exploration tasking functionality for benefit of modern centers of relevant expertise is substantiated. A workable, conceptual model of the mechanism for the granting of rights, to use subsoil for geological study, which provides the necessary conditions for a systematic approach to exploration for oil and gas is developed and presented. Criterion for deciding the auction winner based on indicator of the exploration works intensity is developed. The ways of creating an industrial exploration system, based on a systematic approach, are shown.

Key words: geological survey,exploration business,subsoil use,exploration system,exploration projects,project portfolio,predictive success,risks,required probability,required rate of return,successfulness,risk management,project portfolio management