What to expect when you’re prospecting: how new information changes our estimate of the chance of success of a prospect
What to expect when you’re prospecting: how new information changes our estimate of the chance of success of a prospect
There is a common belief that we can expect to add value to a prospect or prospect portfolio by improving the prospect chance of success (Pg) as a consequence of acquiring information and doing work. Established laws of probability dictate that this is incorrect. We do expect new information to add value to the exploration cycle, but not by an expectation of improving the prospect risk. New information may result in an increase or a decrease of Pg, but the expected result (the average of all possible outcomes) is zero change. Moreover, for a typical exploration prospect (Pg <0.5), we expect that new information will downgrade more prospects Pg than are upgraded. Real-world prospect data are neither suitable nor publically available to study this. Instead, the concept is explored using an analogous process (prenatal prediction of fetus gender) for which good statistics exist, and by creating a synthetic prospect that can be analyzed in a repeatable way. The results support the predictions made above.
2159-2171
Peel, Frank J.
ccbb86f8-56a0-4b59-b664-e772a9c4015f
Brooks, John R.V.
9138247b-d5b8-4eba-adda-a4f087d6a31c
December 2015
Peel, Frank J.
ccbb86f8-56a0-4b59-b664-e772a9c4015f
Brooks, John R.V.
9138247b-d5b8-4eba-adda-a4f087d6a31c
Peel, Frank J. and Brooks, John R.V.
(2015)
What to expect when you’re prospecting: how new information changes our estimate of the chance of success of a prospect.
AAPG Bulletin, 99 (12), .
(doi:10.1306/070615045).
Abstract
There is a common belief that we can expect to add value to a prospect or prospect portfolio by improving the prospect chance of success (Pg) as a consequence of acquiring information and doing work. Established laws of probability dictate that this is incorrect. We do expect new information to add value to the exploration cycle, but not by an expectation of improving the prospect risk. New information may result in an increase or a decrease of Pg, but the expected result (the average of all possible outcomes) is zero change. Moreover, for a typical exploration prospect (Pg <0.5), we expect that new information will downgrade more prospects Pg than are upgraded. Real-world prospect data are neither suitable nor publically available to study this. Instead, the concept is explored using an analogous process (prenatal prediction of fetus gender) for which good statistics exist, and by creating a synthetic prospect that can be analyzed in a repeatable way. The results support the predictions made above.
Text
Peel and Brooks 2015a_what to expect_BLTN15045.pdf
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Accepted/In Press date: July 2015
Published date: December 2015
Organisations:
Marine Geoscience
Identifiers
Local EPrints ID: 378953
URI: http://eprints.soton.ac.uk/id/eprint/378953
ISSN: 0149-1423
PURE UUID: 30e8a0be-6f92-448c-af32-0f1c89067fe5
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Date deposited: 10 Jul 2015 11:00
Last modified: 14 Mar 2024 20:31
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Author:
Frank J. Peel
Author:
John R.V. Brooks
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