DR. EICKEN: Part of the development issue is time, which, you know -- time is money. You could argue that 15 years down the line a lot of the discussions about offshore development are obsolete because lateral drilling technology has evolved to the point where you can tap 70 percent of the resources by drilling on land.
DR. HALEY: They always want to develop more sooner. The economics are just set up that way and the only backstop that will force them to take those 17 years and invest in new technologies is if they can't have access to the resources until they do it.
DR. ZOLOTUKHIN: Yes, I agree. So the industry wants to develop as soon as possible, not only because of the time frame of investments but because new resources or sources of energy could be invented and then the petroleum business could go down. What seems to be attractive today could be unattractive tomorrow.
That's why some of the companies are already investing in research in non-traditional sources of energy. They’re investing, they’re investigating, there is cutting-edge science development in these companies. They are trying to be better prepared, at least, better scientifically and research-wise to those challenges. So it's not only the time, but it's the vision of that. This is a very good piece of business for them that should be taken as early as possible.
DR. TIDWELL: Now take it all the way back to how we get the companies to invest in a 17-year, 20-year process, figuring out how to make the best flexible technology. In Norway when that process started, was Statoil guaranteed that at the end, they would also be the producer? In other words, what was the incentive for them to go through a 20-year process? Was it because all of the oil companies were pooled together to share in the outcome at the end of the 20 years?
DR. ZOLOTUKHIN: Well, the incentive was that it was a very interesting field. Commercially. It was guaranteed to when the license was issued. That means that your technological solutions and technical solutions satisfy existing guidelines and requirements.
DR. TIDWELL: So at the beginning, at year zero, no one was guaranteed that they would be able to use the field at the end?
DR. ZOLOTUKHIN: To a certain extent, yes. They got some kind of right of the first night because they were discoverer. They discovered the field, so they have a right. But you cannot do anything unless you launch a project which satisfies all of the licensing requirements.
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