Exploration drilling productivity at the Norwegian shelf

Recently, we have seen falling oil prices combined with sticky costs at a high level in the petroleum industry. This causes project postponements, thus challenging reserve replacement of oil companies and security of supply for consumers. Costs are particularly high for drilling. High rig rates are obviously important. In addition we experience a dramatic fall in drilling productivity. This paper analyses the development in drilling productivity in exploration wells at the Norwegian continental shelf. A unique data set allows us to apply econometric analyses to ascertain vital explanatory factors for variation in drilling productivity over time and between different wells.