Sequential Value of Information for Subsurface Exploration Drilling

Quantitative methods are needed for systematic decision-making during exploration for subsurface resources, but few methods exist that fully incorporate the interaction of geological, operational, and financial conditions. The sequential nature of planning where to drill for subsurface exploration is not commonly addressed by conventional techniques in a quantitative fashion, despite its foundational relevance to hypothesis testing. Value of information (VOI) can incorporate various aspects of subsurface exploration decision-making as well as sequence. Here, we use VOI to determine the optimal sequence and placement of exploration boreholes when varying conditions such as target resource volume and drilling cost. Using VOI, we show that the optimal placement and selection of exploration boreholes change when planning to drill one borehole at a time compared to planning to drill two boreholes sequentially. A formulation and tutorial explanation of VOI for sequential decision situations are shown using a synthetic case. We demonstrate a test case using data from a real metal deposit.