Wouldn’t it be great if every high-school teenager in the world knew the effort it takes to make the decision to find a prospect and bring it on line? It’s not great yet, but thanks to a company in the Faroe Islands, it’s getting greater.

Put together a superior team, set a plan, raise money, assemble prospects, filter them for potential return, form partnerships and put together the prospects you think will earn the highest return. Thousands of people have done it, and thanks to Eni, the government of the Faroe Islands, a bunch of school systems, a company called Simprentis, Maersk International and Chevron Corp., thousands of students got an opportunity to try their hands at the same opportunity.

The Faroes government asked for community involvement on its first licensing round. As part of that obligation, Eni (UK) Team Leader Ron Lansdell devised the idea for a true-to-life oil-finding computer game that Simprentis later turned into OilSim. That program, expanded to a high-school-level contest, has doubled in size every year since 2003.

Last year, Chevron and Maersk sponsored an international program among schools in seven nations with 1,100 students competing for the US $4,000 top prize. Seventeen teams made it to the finals, and the top five played in the runoff at Chevron headquarters in London.
Here’s the concept. An oil company headquarters sends a team to remote islands to explore commercial quantities of oil using as little money as possible. The team starts with $100 million, but it can ask for more money from headquarters. The object is to get the top return on investment by the end of the third licensing round.

The simulation is familiar. The teams study geophysical surveys, acquire licenses, enter into partnerships, lease drilling rigs and buy well services.

Teams pay for the surveys they use. Each team gets only one license in each licensing round, and depending on the license, it may have to pay a signing bonus. A team can join into partnerships with other teams. If it does that, it must expect to pay a premium for the privilege.

To earn a return, teams must drill wells, and they have to contract rigs and well services from a number of companies to complete the wells. They have to pay for all those services.
If they discover oil, they earn a return. In a partnership, each partner pays a share of the costs and gets a percentage share of the payout.

The teams get paid only on proven reserves, and a team must drill at least two wells on a prospect to prove it contains commercial quantities of oil.

The Mighty Vikings of Denmark won the contest last year with $2.408 million in earnings for a return of 1,095%. Greenland’s Inuit Oil followed with $2.027 million in earnings and a return of 961%. Following, in order, were The Guys in Uniform from Scotland with an 881% return, the Faroe Islands team with a 659% return and Norway’s Snake Oil with a 308% return.

Think of what the youngsters must determine to even compete in this contest. They have to find out where and how to find oil. They have to learn about geophysical surveys. They must learn the rules of licensing rounds and partnerships. They have to know what services go into a drilling operation and the cost of those services. They have to figure out how to reduce uncertainty in their choices, and they have to determine economically viable volumes to produce. Sounds a lot like a real oil company.

Typically, if an oil company wants to sponsor the educational part of the game, it will contact Simprentis at www.simprentis.com, set up the contest, and both the oil company and Simprentis will approach school authorities about the simulation contest.

Normally, when Simprentis runs OilSim for a company training program, it also provides facilitators to help keep the game moving, interpret rules and provide guidelines for realistic operations. In the educational version, the company trains the teachers to be facilitators.
This year, the company anticipates more than 2,000 participants, and it has a new twist. For players who have competed in earlier sessions, it will introduce a field development simulation. In following years, it plans to bring on a production simulation and a refining simulation.

“Our primary plan is to develop the simulations for the whole value chain from exploration to distribution (upstream and downstream). Also, we plan to develop other modules and separate learning simulations together with oil and gas companies, including a learning simulation that gives an overview of the future challenges of energy,” said Olavur Ellefsen, chief executive officer of Simprentis.

Great possibilities. It would do wonders for the energy industry if students and other interested people could use a simulation to compare the full value chain of the whole range of energy alternatives — complete with environmental consequences and impact on developing countries — and make independent determinations about the best course for the energy future for themselves.