Oil and gas companies are focusing on maximizing returns by strategically exploring hydrocarbon resources. Companies that invested early in frontier plays like Guyana are reaping the benefits of large oil and gas discoveries, while others are concentrating on areas with existing infrastructure. These regions, close to producing fields and platforms, offer lower exploration and development costs, making them an attractive option for continued exploration.

Since the oil price crash a decade ago, exploration spending has remained relatively flat at around $50-60 billion annually, a significant drop from the $117 billion spent in 2013. Despite this, exploration expenditures have not rebounded significantly since 2016, as the industry has become more cost-conscious and seeks quicker returns on investments. This shift has led companies to prioritize shorter lead times from discovery to production, opting for smaller, more efficient projects.

For most major international companies, the emphasis is on "smaller and lower" – smaller budgets and shorter development timelines. While discoveries in these areas are typically smaller than those in frontier regions, the reduced exploration and development costs make these projects economically viable. The proximity of potential discoveries to existing infrastructure further enhances the profitability of such ventures, making them an attractive option in the current market environment.

Infrastructure-led exploration (ILX) has proven to be an effective strategy, with discovery success rates exceeding the global exploration success rate by 10 percentage points. Over the past five years, nearly 900 ILX wildcat wells have been drilled, and 42% of these wells were successful, compared to the global exploration success rate of 32%, according to Rystad Energy. This higher success rate, combined with substantial resource additions, has made ILX a key driver for sustaining production and maximizing the use of existing infrastructure, as noted by Aatisha Mahajan, Vice President of Exploration Research at Rystad Energy.

One prominent example of ILX’s success is offshore Norway, where Equinor and its partners have focused their exploration efforts on areas adjacent to existing production platforms. In the Norwegian Sea, Equinor recently announced a new gas and condensate discovery near the Åsgard and Kristin fields, which already have established infrastructure. The proximity of this discovery to existing facilities allows for more efficient development, as Grete Haaland from Equinor highlighted. This approach is part of a broader strategy to continue utilizing existing infrastructure to unlock new reserves.

The success of ILX is further demonstrated by Equinor’s development of the Johan Castberg oilfield in the Barents Sea, which has opened up additional opportunities in the Arctic region. Equinor estimates that this project could lead to the addition of 250-550 million new recoverable barrels, further underscoring the value of developing resources in areas with established infrastructure. This strategy of focusing on well-developed regions helps the company unlock new reserves while minimizing exploration and development costs.