Abstract: Risk, Uncertainty, and Improving Exploration Performance

By

Peter Rose

Risk and uncertainty are inherent aspects of investing in exploration ventures. Risk, the weight of investment-level with respect to budget and consequence, is a subtle, variable, but important factor which is intrinsically difficult to apply consistently. Uncertainty, the perceived range of probabilities that a given situation may exist, lends itself more readily to systematic consideration. Professionals may be able to improve their abilities to assess uncertainty more reliably. Judgments of both risk and uncertainty are highly susceptible to commonly unrecognized psychological influences and biases.

Analysis of geologic predictive performance is concerned not only with how well geologists measure something only partly known, but also to express how probable it is that those predictions are reliable. By comparing past predictions on exploratory ventures and post-mortem results, in perspective with contemporary drilling statistics, individuals and groups can improve many different aspects of their overall exploration performance.

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