Arctic Seismic Survey Group Order Seen as Exception, PGS Says
Such group orders demand time consuming coordination between oil producers, PGS Chief Executive Officer Jon Erik Reinhardsen said in an interview in Oslo today.
“It’s an extremely labor-demanding form,” he said. “I don’t think we’ll see too much of this.”
Group orders could erode the multi-client business for seismic companies such as PGS, which collect data at offshore sites at their own initiative and then later license it to interested oil and gas explorers
Pushed by Norwegian authorities, a group of 17 explorers including Statoil, BP Plc (BP/) and ConocoPhillips (COP) agreed to order 3D seismic data from blocks in the southeastern Barents Sea, a region formerly disputed by Russia. It’s the first area to be opened to explorers by Norway since 1994. Statoil, which is 67 percent owned by the government, said group orders cut costs by reducing the number of seismic operations.
“The geophysical industry is concerned that this group project will undermine the multi-client business model that has benefited both the exploration and production companies and the Norwegian government,” the International Association of Geophysical Contractors, an industry group, said last week.
Group orders are also opposed by some oil companies because they favor bigger producers, according to PGS.
“Bigger companies get an insight that the smaller ones don’t like,” Reinhardsen said. “It’s not certain that this is healthy for the diversity on the Norwegian shelf.”
The company will bid for the Barents Sea surveys due to start in April.
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