Glossary of Technical Terms Used in Reservoir Engineering: Delphi Technique

Delphi Technique

Delphi Technique: A Consensus-Driven Approach to Oil & Gas Estimation

In the complex and unpredictable world of oil and gas, accurate estimation is paramount. From drilling costs to reservoir reserves, informed decisions rely on reliable figures. The Delphi Technique offers a structured approach to achieving this, by harnessing the collective wisdom of experts through a series of iterative consultations.

What is the Delphi Technique?

The Delphi Technique is a forecasting method designed to reach a consensus view by soliciting anonymous input from a panel of experts. It involves multiple rounds of questioning and feedback, enabling experts to refine their individual assessments while staying informed of the group's overall perspective.

How it Works in Oil & Gas:

  1. Expert Selection: A panel of experts with relevant expertise in the specific area (e.g., reservoir engineering, drilling, economics) is carefully selected.
  2. Initial Questionnaire: The facilitator sends a questionnaire to each expert, asking for their individual estimations or predictions on the topic in question.
  3. Feedback and Refinement: The facilitator compiles the responses, anonymizing the individual inputs. Experts are then presented with the group's overall response, and given a chance to revise their own estimates based on the collective knowledge.
  4. Iterative Rounds: This process of feedback and refinement repeats for several rounds until a consensus emerges. The final consensus estimate represents the collective wisdom of the expert panel, tempered by the insights gained through the iterative process.

Advantages in Oil & Gas:

  • Minimizes Bias: Anonymity eliminates groupthink and pressure to conform, allowing experts to express their independent opinions without fear of judgment.
  • Improves Accuracy: By iteratively refining estimations, the technique incorporates the collective experience and knowledge of the expert group, leading to more accurate forecasts.
  • Facilitates Consensus: The iterative process encourages dialogue and understanding, fostering a shared understanding of the challenges and uncertainties involved.
  • Cost-Effective: The Delphi Technique is relatively inexpensive compared to other methods that require extensive data collection or field studies.

Applications in Oil & Gas:

  • Estimating Production Rates: Accurately forecasting future production from a well or field is essential for investment decisions.
  • Predicting Exploration Costs: Delphi can help estimate the cost of drilling and exploration activities, informing investment strategies.
  • Assessing Reservoir Reserves: Determining the amount of recoverable oil and gas in a reservoir is crucial for project planning and profitability analysis.
  • Evaluating Technology Adoption: Assessing the feasibility and potential impact of new technologies in the oil and gas industry.

Conclusion:

The Delphi Technique offers a valuable tool for decision-making in the oil and gas industry. By combining expert knowledge with a structured process, it helps overcome the challenges of uncertainty and complexity, fostering more informed and accurate estimations. From exploration to production, the Delphi Technique empowers oil and gas stakeholders to make confident decisions based on the wisdom of the collective.


Test Your Knowledge

Quiz: Delphi Technique in Oil & Gas

Instructions: Choose the best answer for each question.

1. What is the primary goal of the Delphi Technique? a) To identify the most influential expert in a field. b) To reach a consensus view among experts on a specific topic. c) To gather data for statistical analysis. d) To conduct a survey of industry trends.

Answer

The correct answer is **b) To reach a consensus view among experts on a specific topic.**

2. What is a key advantage of the Delphi Technique? a) It eliminates all potential biases in expert opinions. b) It provides a definitive and absolute answer to any question. c) It minimizes groupthink and pressure to conform. d) It guarantees the accuracy of forecasts.

Answer

The correct answer is **c) It minimizes groupthink and pressure to conform.**

3. Which of the following is NOT a typical application of the Delphi Technique in oil and gas? a) Predicting the price of oil in the next five years. b) Estimating production rates from a new oil well. c) Assessing the feasibility of a new drilling technology. d) Determining the amount of recoverable oil in a reservoir.

Answer

The correct answer is **a) Predicting the price of oil in the next five years.** While Delphi can be used to estimate cost and production related to oil, predicting market fluctuations is beyond its scope.

4. How does the Delphi Technique work? a) Experts gather in a single meeting to discuss and reach a consensus. b) Experts are interviewed individually and their responses are aggregated. c) Experts complete questionnaires in multiple rounds with feedback and revisions. d) Experts use computer simulations to generate forecasts.

Answer

The correct answer is **c) Experts complete questionnaires in multiple rounds with feedback and revisions.**

5. What is the role of anonymity in the Delphi Technique? a) To protect the identities of experts from the public. b) To ensure the confidentiality of data collected from experts. c) To allow experts to express their opinions freely without fear of judgment. d) To prevent experts from influencing each other's opinions.

Answer

The correct answer is **c) To allow experts to express their opinions freely without fear of judgment.**

Exercise: Applying the Delphi Technique

Scenario: Your company is considering investing in a new offshore oil drilling project. You need to estimate the potential costs associated with drilling and setting up the rig.

Task: Imagine you are the facilitator for a Delphi Technique session to estimate drilling and rig setup costs for the project.

  1. Identify: List three types of experts you would include in the Delphi panel.
  2. Outline: Write a brief initial questionnaire with at least three questions related to cost estimation for the project.
  3. Describe: Explain how you would provide feedback to the experts after the first round of responses.

Exercice Correction

This is just one possible approach to the exercise, and your answers might vary depending on your specific project details.

1. Expert Identification: * Drilling Engineers: Expertise in drilling operations, equipment, and costs. * Offshore Construction Experts: Knowledge of rig setup, infrastructure, and related expenses. * Financial Analysts: Understanding of market conditions, material costs, and financial modeling.

2. Initial Questionnaire: 1. What is your estimated cost per meter drilled for this specific offshore drilling project, taking into account water depth, geological conditions, and equipment requirements? 2. Estimate the cost of installing the rig and associated infrastructure (e.g., pipelines, platforms) for this project. 3. What are the potential factors that could significantly impact the overall project cost (e.g., regulatory approvals, weather conditions, unexpected geological features)?

3. Feedback Description: After the first round, I would anonymize the responses and present a summary of the group's cost estimates, highlighting the range of estimates and any significant variations in opinion. I would also provide a brief overview of the identified potential cost drivers. This feedback would allow experts to refine their estimates based on the collective knowledge and adjust their cost projections if needed.


Books

  • "Delphi Method: Techniques and Applications" by Harold Linstone and Murray Turoff (1975): A foundational text on the Delphi technique, covering its history, methodology, and applications across various fields.
  • "Forecasting: Principles and Applications" by Spyros Makridakis, Steven Wheelwright, and Rob Hyndman (1998): Includes a dedicated chapter on the Delphi technique, explaining its application in forecasting and its advantages compared to other methods.
  • "Strategic Management of Oil and Gas Resources: A Practical Guide" by John R. McMillan (2015): Discusses the Delphi technique within the context of resource estimation and decision-making in the oil and gas industry.

Articles

  • "The Delphi Method: Techniques and Applications" by Linstone, H.A. and Turoff, M. (1975): A seminal article outlining the methodology and applications of the Delphi technique.
  • "The Delphi Method: A Critical Appraisal" by Rowe, G. and Wright, G. (1999): Provides a comprehensive review of the Delphi technique, discussing its strengths, weaknesses, and potential biases.
  • "Using the Delphi Technique to Forecast Oil and Gas Production" by S.M. Gharibzadeh et al. (2012): A case study demonstrating the application of the Delphi technique for forecasting oil and gas production from a specific reservoir.

Online Resources

  • "Delphi Method" - Wikipedia: A comprehensive overview of the Delphi technique, covering its history, methodology, advantages, disadvantages, and applications.
  • "The Delphi Method: A Comprehensive Guide" by Decision-Making & Problem-Solving: A detailed guide to the Delphi technique, including its steps, advantages, and examples.
  • "How to Use the Delphi Technique" by MindTools: A practical guide on how to implement the Delphi technique, with tips for selecting experts and facilitating the process.

Search Tips

  • "Delphi Technique oil & gas": This search will return relevant articles and resources specific to the use of the Delphi technique in the oil and gas industry.
  • "Delphi Method application reservoir estimation": This search will help you find resources focusing on the application of the Delphi technique for estimating oil and gas reserves.
  • "Delphi Technique case study production forecasting": This search will provide you with case studies demonstrating the application of the Delphi technique for forecasting oil and gas production.
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