From a senior E&P executive's perspective, explorationists view his office as a bank with an unlimited vault issuing zero-interest loans. However, before approving millions of dollars for each project, he or she needs answers to: “How much do you want? What's in it for the company, and what's the return on investment?” The executive must then factor into those answers myriad other considerations including balancing the investment portfolio over time and the asset life cycle.

Meanwhile, the industry environment is not static. It is constantly changing, much of the change is due to the ongoing introduction of new technology into...

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