Exploration was the first activity to fall prey to the majors’ upstream spending cuts when oil prices started to decline two years ago. And changing priorities mean that it may not return to former levels, even if oil prices recover further. Exploration in high-cost frontier areas-championed anew by the majors in the days of $100/bl oil, after independents, such as London-listed Tullow Oil, grabbed headlines and investors’ attention with high-profile discoveries-effectively ground to a halt with the oil price shock. Spending on exploration in the global oil and gas sector fell by 45pc last year compared with 2013, US bank Morgan Stanley estimates. The amount of new oil discovered in 2015 was the lowest since 1952, it says.
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