Energy Giants Revive Exploration Efforts Amid Growing Supply Concerns

Oil and gas exploration is back on the agenda for energy giants after years of underinvestment. At the CERAWeek conference in Houston, executives from major companies emphasized the need to replenish reserves over the next decade as production depletes existing fields.

The Permian Basin's production in the US is expected to plateau while energy demand keeps growing, highlighting the importance of finding new resources. The U.S.-Israeli war on Iran has also heightened concerns about supply shortages, making new discoveries more critical.

Rebuilding reserves through acquisitions will be challenging after a surge in massive deals in recent years, putting the focus back on geography and geology. Francisco Gea, Repsol's executive managing director of exploration and production, noted that the industry has been replacing less than 25% of its annual production, drastically down from the heyday of exploration.

Technology is helping oil majors move faster than ever, slashing the time between making a discovery and drilling first oil. Norway's Equinor targets an average exploration timeline of two to three years, down from five to six years, while Exxon Mobil aims to grow oil and gas production to 5.5 million barrels per day by 2030.