Mitigating Bias, Blindness and Illusion in E&P Decision Making
|Mr Marc Bond (Rose & Associates, United Kingdom) or Mr Creties Jenkins (Rose & Associates, USA)|
|Training and Development – Human Resources|
|10 CPD points|
DECISION MAKING ECONOMICS BIAS PLANNING UNCERTAINTY WORKFLOWSRISK HEURISTICS INTUITION OBJECTIVITY POST-APPRAISAL CALIBRATION ESTIMATION OVERCONFIDENCE
Next available location:
Education Days Houston 2019: a 2-day course on 12 and 13 November 2019 - Register now!
Decisions in E&P ventures are affected by cognitive bias, perceptual blindness, and various forms of illusion which permeate our analyses, interpretations and decisions. This two-day course examines the influence of these cognitive pitfalls and presents techniques that can be used to mitigate their impact.
"Bias" refers to errors in thinking whereby interpretations and judgments are drawn in an illogical fashion. "Blindness" is the condition where we fail to see an unexpected event in plain sight. "Illusion" refers to misleading beliefs based on a false impression of reality.
All three—Bias, Blindness, and Illusion--can lead to poor decisions regarding which work to undertake, what issues to focus on, and whether to continue investing time, effort, and money in a given project.
The course begins by examining how these cognitive errors affect us. Several different errors are discussed, including: Perceptual Blindness; Illusions of Potential, Knowledge and Objectivity; and Anchoring, Availability, Confirmation, Framing, Information, Overconfidence and Motivational Biases. Exercises, videos, and examples help illustrate how these manifest themselves in our daily activities and affect our judgment, often without us realizing it. We then focus on the oil and gas industry where drilling portfolios, production forecasts, resource assessments, and other activities are regularly impacted. Techniques are presented that can be used to mitigate cognitive errors and examples are shown where these techniques have worked.
A key element of the course are the mitigation exercises which give participants a chance to apply what’s been learned to real-life situations. For example, what elements of the “anchoring bias” led to the belief that the exploration potential of a prospect offshore Brazil was much greater than it turned out to be? Or, what elements of the “confirmation bias” led to a decision regarding which analogous data should be used to predict the outcome of a new drilling project?
The second day includes a series of exploration and appraisal case studies resulting in both positive and negative outcomes. Participants are asked to identify cognitive errors contributing to the project results, and which of these had the greatest impact. This is followed by a 3-hour, real-world exercise using project data to give participants practice in addressing cognitive errors. The exercise requires participants to list all of their assumptions followed by a list of the contrary assumptions. This is followed by an assessment of the impacts if the contrary assumptions are true, and what key types of data / analyses will be required to determine which set of assumptions are correct. Finally, the participants identify cognitive errors leading to the actual project outcome.
The course concludes by presenting a summary ‘toolkit’ with mitigation techniques that can immediately be applied to project work and decisions. This includes a laminated card listing the various types of bias, blindness and illusion on one side, and the six key steps to mitigate these cognitive errors on the flip side. This helps participants immediately apply the concepts to their daily work.
Upon completion of the course, participants will be able to:
- Identify the influence of Bias, Blindness and Illusion on their analyses, interpretations and decisions;
- Apply techniques that will mitigate the impact of these in their project work and decision-making;
- Ensure that their behavior does not unwittingly reinforce these cognitive errors in others.
1. Introduction (1 hour)
2. Blindness and Illusion (3 hours)
a. Perceptual Blindness
b. Illusion of Knowledge, Potential, and Objectivity
3. Bias (4 hours)
a. Anchoring, Availability, Confirmation, Framing, Information, and Overconfidence Bias
b. Motivational Bias
4. Case Studies--an appropriate subset of these will be chosen (2 hours)
a. Plio-Pleistocene Sandstone (Exploration Well)
b. Cambrian Sandstone (Field Appraisal)
c. Pliocene Sandstone (Exploration ‘Drill or Drop’)
d. Jurassic Sandstone (Exploration License Round)
e. Cretaceous Shale (Field Appraisal)
f. Cambrian Sandstone (Field Appraisal)
5. Real-World Exercise--one of these will be chosen (3 hours)
a. Triassic sandstone, structural play (Exploration Well)
b. Fractured carbonate, waterflood potential (Field Appraisal)
6. Summary ‘Toolkit’ (1 hour)
This course is designed to have broad appeal to all levels and disciplines within an organization: junior to senior level geoscientists, junior to senior level engineers, analysts, landmen, HSE, HR, etc. And mid-level to senior managers and executives.
About the instructor(s)
The course is designed to be taught be one instructor. However, two different instructors are available to teach the course.
Marc Bond (MSc Geophysics, Colorado School of Mines) is an Associate with Rose & Associates specializing in exploration and appraisal assessments. He is actively involved in ensuring that the technical work underpinning an evaluation has appropriately reflected the opportunity and captures both the uncertainty and risk, leading to effective decision-making. He has over 35 years’ international experience in the oil and gas industry. Previously he worked for BG Group and Tenneco Oil where he held a variety of management and technical assignments, with his most recent roles including: Chief Geophysicist; Subsurface Assurance Manager for conventional and unconventional exploration, appraisal and development projects; and Exploration Manager Bolivia.
Creties Jenkins (P.E., P.G.) is a Partner with Rose and Associates specializing in the characterization of unconventional reservoirs. Over the last 15 years he has conducted integrated studies, project reviews, and resource evaluations for 50+ companies and taught 100+ industry courses and workshops. He has served as a technical editor, distinguished lecturer, distinguished author for SPE, and is a past president of the Energy Minerals Division of AAPG. Creties has 30+ years of experience having previously worked at Tenneco, ARCO, and DeGolyer & MacNaughton. He holds a BSc in Geological Engineering and a MSc in Geology from the South Dakota School of Mines.
Explore other courses under this discipline:
Attracting, Developing & Retaining Top Technical People
Prof. Peter Lloyd (Honorary Professor)
Mitigating Bias, Blindness and Illusion in E&P Decision Making
Mr Marc Bond or Mr Creties Jenkins (Rose & Associates)
Art of Science
Dr Roel Snieder (Colorado School of Mines)