While I can perhaps see how some of the current operations of the mega size deepwater fields may be viable at $40, I seriously doubt that exploration can be at that low a crude price.
Too many dollars to drill and too high a risk.
Friday will help us see what some producers think about deepwater.
Brazil auction tests oil major appetite for deepwater fields
https://www.reuters.com/article/us-brazil-oil/brazil-auction-tests-oil-major-appetite-for-deepwater-fields-idUSKBN1CU1FSOCTOBER 25, 2017
Top global oil companies will compete on Friday in Brazil’s billion-dollar auction for some of the world’s most prolific deepwater oilfields, a test of their appetite for capital intensive offshore projects after three years of low oil prices.
Competition between firms such as Exxon Mobil, Royal Dutch Shell and Total> is expected to be fierce for the more than 12 billion barrels of estimated oil reserves Brazil is offering. At current prices, that volume of oil is worth around $600 billion.
After reforms to the energy sector in the past year and a half, Brazil will auction eight blocks on more attractive terms than ever before to international firms for access to its pre-salt fields. They are reservoirs of oil that sit beneath thousands of feet of salt under the deep Atlantic waters off eastern Brazilian shores....