Appraisal

Suppose you find a single gold coin while digging in your backyard. Before deciding whether to dig further, you would naturally want to know if that coin is a one off or the edge of a much larger hoard. Appraisal is that follow up investigation applied to an oil or gas discovery.

Once an exploratory well confirms hydrocarbons are present, appraisal involves drilling additional wells around the discovery and running further tests to establish the actual size, quality and commercial viability of the field, before a company commits the much larger capital needed for full field development. It is entirely possible, and common, for appraisal to reveal a field is either far bigger or far smaller than the initial exploratory well suggested.

Hindustan Oil Exploration Company's B80 block is a textbook example of appraisal changing the story completely, its estimated reserves rose roughly tenfold once proper appraisal work was done, turning a modest initial find into a genuinely valuable asset.