Analytics Magazine Analytics Magazine, November/December 2014 - Page 20

forum Your data already knows what you don’t The marriage of two “natural resources” – hydrocarbons and data – will transform unconventional oil development. How do we gain ground on the vexing “unknowns” to tilt the inherent risks involved in shale oil development in our favor? By Atanu Basu (above), Daniel Mohan and Marc Marshall Known-knowns, known-unknowns and unknownunknowns. Donald Rumsfeld’s notable turn of phrase is an apt characterization of where we are with unconventional oil development today. Shale operators in Eagle Ford (South Texas), Permian (West Texas), Bakken (Upper Midwest) and other places have transformed the United States into an energy superpower by profitably extracting oil and gas from tight rocks that weren’t commercially viable even a few years ago. With that backdrop, unconventional oil development today is punctuated by significant performance variations among operators with contiguous acreage positions and meager estimated ultimate recovery (EUR) rates. Unless performance keeps improving, any fluctuation in commodity prices can send shockwaves through the oil patches around the country, as we have seen happen with natural gas. How do we gain ground on the vexing “unknowns” to tilt the inherent risks involved in shale oil development in our favor? Standing on the shoulder of giants Geoscience (geoscientists are the giants of the energy industry) is finally getting a shot in the arm from data science, especially from Google-like technologies 20 | a n a ly t i c s - m a g a z i n e . o r g w w w. i n f o r m s . o r g