WellBet allows ordinary people to bet on whether exploration wells will lead to commercial oil and gas discoveries. (Photo: Flickr)
There’s nothing new about placing bets on horse races or sports teams. But now, thanks to a program called WellBet, people can try their luck at betting on oil and gas exploration on the Norwegian continental shelf.
There’s a catch, though – there’s no money involved. If they’re right, all people get are bragging rights, and the knowledge that they might be just as good as an expert.
WellBet is the brainchild of GeoNova, a Norwegian community of geoscientists, and a team from oil and gas company Atlantic Petroleum Norge. The idea is to compare the wisdom of the crowd with the knowledge of experts by giving ordinary people the chance to predict whether exploration wells will lead to commercially viable oil and gas discoveries.
And so far, it seems, the crowd is winning.
Hans Gebauer, the community manager at GeoNova, said that after more than 1,000 bets on 27 wells, the public has correctly predicted which wells would yield commercial discoveries and which would not about 74 per cent of the time.
“We find that very intriguing,” he said. “It’s a remarkable result.”
The power of the people
In practice, Gebauer said, oil companies only find viable deposits with about 25 per cent of the wells they drill. But that number isn’t exactly a fair comparison to the community’s 74 per cent success rate, since not every well is drilled in anticipation of a commercial discovery.
Still, Gebauer believes there are valuable lessons to be learned from WellBet.
“People are not stupid,” he said. “It’s never wrong to listen to what others are thinking. This is the minimum and probably the best learning from WellBet. It’s an example of looking outside the boundaries of your knowledge.”
Anyone can bet anonymously using WellBet. But the program does require participants to enter some information, including whether they work in the oil industry or the academic community, and how much prior knowledge they have of the leases being explored.
WellBet then provides participants with some information about each well, including the exact location and the proximity to other successful or unsuccessful wells.
Gebauer said most participants are working for the oil industry in some capacity, but most don’t seem to have any specialized knowledge of particular wells. However, he’s a bit skeptical of the current success rate being as high as it is, and he wonders if some of the participants know more than they let on.
“This is too good to be true,” he said. “I don’t believe the community is that ingenious.”
He also pointed out that it’s easy to do fairly well simply by betting that every well will be unsuccessful, since the majority of them are. He plans to look more closely at the community’s ability to predict specifically the wells that will be commercially viable.
A useful resource
Gebauer said a resource like WellBet could be useful for small companies who have more to lose from drilling unsuccessful wells. He admits it will probably be a while before companies are willing to crowd-source exploration decisions, but he said oil company managers are already paying attention to WellBet.
At the very least, he said, if you know that the community agrees with your decision to drill a particular well, “then you sleep much better at night.”
Gebauer is encouraging anyone who is interested to try out WellBet. Right now, one of the open bets is OMV’s Bjaaland well in the Barents Sea, southeast of Bear Island.
Even he has tried his hand at the program.
“I’m telling you I’m not that bad,” he said. “My personal score is quite okay.”