Unconventional oil and gas exploration 'here to stay', says ConocoPhillips CEO

Unconventional oil and gas exploration, such as US shale and offshore deepwater drilling, are here to stay according to Ryan Lance, CEO of ConocoPhillips.

Speaking at the OPEC International Seminar in Vienna, Austria on Thursday, Lance said: “Unconventional production has staying power because we’ve come to a stage where reservoir engineering, drilling and exploration continue to advance.

“Shale plays – where gas followed by oil exploration meaningfully took off in 2005 and 2011 respectively – have seen a 30% reduction in operating costs, keeping them going at lower oil prices.

“With industry forecasts of 40 to 190bn barrels of technically recoverable oil in the US Permian, Eagle Ford and Bakken basins, shale exploration will continue to play its part in the oil markets,” Lance told OPEC delegates.

The ConocoPhillips CEO also predicted that operating cost for tight oil plays was likely to go down even further. Commenting on the direction of the oil price, Lance said it would be hard to envision the oil price “going back down to the $40s.”

"We do see demand rising slightly so it does provide some support for prices," he concluded.