I recently attended the 2005 International Forum, a conference that is held every year in Houston on the eve of the North American Prospect Expo (NAPE). This year's discussions focused on international opportunities for independents, and some of the comments made were particularly eye-opening.

Let me first digress by congratulating the sponsors - IHS Energy, the American Association of Petroleum Landmen and the Independent Petroleum Association of America - for consistently putting on a forum that is not another "dog and pony show," as we say here in the United States, but a well-rounded representation of folks in the industry who are keeping a keen eye on new developments worldwide and are able to represent their findings in useful, informative ways.

Of greatest interest to me, of course, were the presentations that focused on new exploration opportunities. While these certainly aren't limited to the independents, those companies are perhaps best placed to take advantage of them, since the majors increasingly have to turn away from everything that doesn't register "elephant" on the Richter scale. While elephants are few and far between these days, company-making prospects are not, at least for those who are still small and would like to get larger.

One of the most thought-provoking presentations came from Michael S. Coffield, vice president of business development for Houston-based Samson International. His presentation (his own views, he carefully noted, and not necessarily those of his current or previous employers) examined "Changing Dynamics - Opportunities for Independents." It didn't pull many punches.

Coffield's talk seemed to echo the sentiments of many exploration-minded folk. Many independent energy companies have been successfully merged and amalgamated in the last couple of decades and then typically run by either engineers or accountants, neither of whom typically display a strong appetite for the technical risk inherent in exploration.

Successful explorationists can manage exploration risks appropriately, to balance the risk/reward scales in such a way as to keep the analysts and shareholders happy whilst continuing to add significant reserves to their portfolios - if only they're given the opportunity.

What the industry needs is "fresh exploration thinking," Coffield said. Here his suggestions were rather profound:

• It's time for geologists to start running companies again;

• Companies need to learn to apply and access new technologies and tools;

• Companies need to learn how to manage risks to explore non-traditional plays (he cited the Buzzard Field, a giant stratigraphic trap discovery being developed in the North Sea); and

• Companies can work to fill in the creaming curve in many established and maturing basins where incremental discoveries still remain to be found with new technologies.

Successful companies will pursue new understanding about how to find hydrocarbons in emerging exploration plays: turbidites, salt tectonic environments, base of slope and basin floor fans, unconformity sub-crops, channel fills, etc., to bring in a world-class discovery. The tools, technology and data to exploit these new plays are available to the independent like never before. There is a vast amount of publicly available well data, much of which can be accessed online, and some of the previous generation's exploration "tricks of the trade" are now widely available: prestack depth migration, marine gravity data, reservoir modeling, etc. High-tech drilling applications such as horizontal drilling, expandable tubulars, measurement-while-drilling with vertical seismic profiling, etc., are also becoming more commonplace. One barrier to success, he said, comes from service company availability and pricing level.

"The service companies are strapped right now; everybody is working at full tilt," he said. "The winners will have an innovative relationship with their service providers."

Finally, he asked, where is the next Michel Halbouty coming from?

"I'm astonished at the failure of companies to properly manage the risks associated with exploration so that they can grow their companies with the drillbit," he said.

Certain companies are getting it right. Cairn Energy, for instance, gained an important presence in an established oil and gas producing area in India and then took measured risks to establish new discoveries in previously unexplored areas. The company carved out a niche using technology accessible to any company, and it established a good working relationship with the host government. It hasn't been any of these things singularly that have made the difference for Cairn, Coffield said - it's been that company's ability to apply all of them together in a way that no other company can imitate - thus creating a competitive advantage.

For the rest of the world, it's time for new prospects to be unveiled. "Good prospectors - please go to work," he said. "We need your prospects."

Additionally, a forward-thinking company will identify its own competitive advantages, apply its strategy in a unique fashion, learn from the successes and setbacks of others and, to paraphrase author Peter Drucker, "concentrate on doing the right things, not just doing things right."

Who will be the winners? "The oil finders," maintains Coffield.