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AN INTEGRATED APPROACH TO PETROLEUM
RESOURCES DEFINITIONS,
CLASSIFICATION AND REPORTING
Rosly Mohd Nor
PETRONAS CARIGALI
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Overview
Definitions & Classification
Estimation & Reconciliation
Reporting
Conclusion
PresentationOutline
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To share some of the industrys practices
in resources / reserves definitions,
classifications , issues and challenges.
To share PETRONASs experiences in
developing and application of its resources
definitions ,classification and reporting inits international ventures.
Objectives
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The Mckelvey Box(1972 )
Proved Probable
Identified
PossibleUndiscovered
RESERVES
RESOURCES
Degree of certainty
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Petroleum Society of Canadian Institute of Mining (1994)
Resources
Undiscovered Resources
or
Future Initial Volumes in Place
Unrecoverable
Volumes
Initial
Reserves
Future Unrecoverable
Volumes
Proved Developed
Producing
Non Producing
Proved Undeveloped
Undiscovered Resources
or
Initial Volumes in Place
Currently Uneconomic Volumes
Residual Unrecoverable Volumes
Remaining
ProvedReserves
ProbableReserves
PossibleReserves
Future Initial
Reserves
Remaining
Reserves
Cumulative
Production
Sales
Probable
Developed
Probable
Undeveloped
Possible
Developed
Possible
Undeveloped
Inventory
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Caldwell & Heather, The Scotia Group , JPT (1995)
DISCOVERED UNDISCOVERED
RESERVES
PROVED PROBABLE POSSIBLE
ECONOMIC
SUB
ECONOMIC
TECHNICAL CERTAINTY OF EXISTANCE
ECONOMIC
FEASIBILITY
OF RECOVERY
Discovered but not
economically recoverable
resources
Low Price
Medium Price
High Price
Undiscovered,
economically
recoverable resources
Undiscovered,
not economically
recoverable resources
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Patricelli & McMichael, Mobil, JPT (1995)
Discovered Undiscovered
Reserves Contingent
(Economic, currently ResourcesProducible) (Uneconomic, not
currently producible)
Proved Probable Possible Proved Probable PossibleP1 P2 P3 P4 P5 P6
Speculative
Potential
Geological Risk
Pg
Associated Confidence Factors
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PETRONAS (1997)
RESOURCES
DISCOVERED
RESERVES
UNPROVED
UNDISCOVERED
POTENTIAL
RECOVERY (PR)
ULTIMATE
RECOVERY (UR)
CUMULATIVE
PRODUCTION
SPECULATIVE
RECOVERY (SR)
PROVED
(P1)
PROBABLE
(P2)
POSSIBLE
(P3)
EXPECTED HIGHLOWPROVED
(P4)UNPROVED
PROBABLE
(P5)
POSSIBLE
(P6)
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PETROLEUM
RESOURCES
DISCOVERED
RESOURCESUNDISCOVERED
RESOURCES
RESERVES POTENTIAL
RESOURCES
HYPOTHETICAL
RESOURCES
SPECULATIVE
RESOURCES
PROVED
RESERVES
UNPROVED
RESERVES
DEVELOPED
RESERVES
UNDEVEL.
RESERVES
PROBABLE
RESERVES
POSSIBLE
RESERVES
LOW LOWEXP. EXP.HIGH HIGH
CCOP (1999)
Committee for Coastal and Offshore Geoscience Programmes
CCOP Members : Cambodia , China, Indonesia, Japan, Malaysia, Papua New Guinea,
The Philippines, Republic of Korea, Singapore, Thailand, Vietnam
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RANGE OF UNCERTAINTY
PRODUCTION
RESERVES
CONTINGENT
RESOURCES
PROSPECTIVE
RESOURCES
PROVED
PROVED
PLUS
PROBABLE
PROVED
PLUS
PROBABLE
PLUS
POSSIBLE
LOW
ESTIMATE
BEST
ESTIMATE
HIGH
ESTIMATE
LOW
ESTIMATE
BEST
ESTIMATE
HIGH
ESTIMATE
UNRECOVERABLE
UNRECOVERABLE
SPE (2000)
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Resource Uncertainty Categories
Society of Petroleum
Engineers (SPE )
World Petroleum
Congress ( WPC )Former Soviet Union
DETRMINISTIC PROBABILISTIC CATEGORY
Proved
Probable
Possible
P1 ( 90% confidence )
P1 + P2 ( 50 % confidence )
P1 + P2 + P3 (10 % confidence )
Class A and B
Class C1
Class C2
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Presentation Outline
Overview
Definitions & Classification
Estimation & Reconciliation
Reporting
Conclusion
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Society of Petroleum Engineers (SPE)
Society of Petroleum Evaluation Engineers (SPEE)
World Petroleum Congress (WPC)
Petroleum Society of Canadian Institute of Mining)
Security and Exchange Commission (SEC) US
Resources Evaluation Consultants
PSC Contractors
Technical Journals
Key Reference
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PETRONAS (1997)
RESOURCES
DISCOVERED
RESERVES
UNPROVED
UNDISCOVERED
POTENTIAL
RECOVERY (PR)
ULTIMATE
RECOVERY (UR)
CUMULATIVE
PRODUCTION
SPECULATIVE
RECOVERY (SR)
PROVED
(P1)
PROBABLE
(P2)
POSSIBLE
(P3)
EXPECTED HIGHLOWPROVED
(P4)UNPROVED
PROBABLE
(P5)
POSSIBLE
(P6)
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International standards and practices
Business & technical applications
Total resources / Field life cycle
Risk & uncertainty quantification
Reporting consistency & transparent
Flexible & Robust
Key Principles
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Applications of Petroleum Resources Estimate
Technical
Prospect Evaluation
Block Assessment
Work Program & Budget
Project Identification Field Development Plan
Facility Design
Appraisal Plan
Improve Oil Recovery (IOR) Project
Research & Development
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Applications of Petroleum Resources Estimate
Business
Corporate Worth Fund Raising (credit rating)
Stock Exchange Reporting
Sales Contracts (LNG ) Earning Basis
Investment Decision (FDP)
Corporate Financial Outlook
Equity Determination
Petroleum Arrangement
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Definition : Resources
Resources are defined as the totalestimated quantities of petroleum at a
specific date to be contained in, or that
have been produced from knownaccumulations, plus those estimated
quantities in accumulations yet to be
discovered.
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Definition : Undiscovered Resources
Undiscovered Resources are definedas the the total estimated in-place of
petroleum at a specific date to be
contained in accumulations yet to bediscovered.
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Definition : Discovered Resources
Discovered Resources is defined asthe total estimated in-place quantities of
petroleum at a specific date to be
contained in known accumulations thathave been penetrated by a wellbore.
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Definition : Speculative Recovery ( SR )
Speculative Recovery is defined as
the undiscovered resources at a specific
date to be contained in unproven traps,
undrilled provinces, structures or deeper
reservoirs underlying productive fields
where geological conditions are believed
to be favourable for the accumulation ofpetroleum which if present, may
eventually be recovered.
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Definition : Potential Recovery ( PR )
Potential Recovery is defined as thediscovered resources that are recoverable
but not producible at a specific date due to
economic, political, environmental or
technological reasons.
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Potential Recovery Category
Economic
- Production Sharing Contract (PSC)- Development concept
Technology- Hydrocarbon quality (API, CO2, H2S etc)
- Small fields
- Reservoir with inconclusive data- Location
- Adverse parameters
- Geological complexity
Environment- HSE regulation
Political- Under unitization
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Definition : Ultimate Recovery ( UR )
Ultimate Recovery is defined as thediscovered resources anticipate to be
commercially recoverable from known
accumulations at a specific date, under
existing economic condition, by
established operating practices and under
current government regulations.
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Definition : Reserves
Reserves is defined as the totalestimated remaining quantities of
petroleum anticipated to be commercially
recoverable from known accumulations ata specific date, underexisting economic
conditions, by establishes operating
practices and undercurrent governmentregulations.
D fi iti R
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Definition : Reserves
PROVED RESERVES
- reasonable certainty means a probability (confidence) of at least 85%
that the estimated quantities will be recovered.
PROBABLE RESERVES
- sufficient degree of certainty means a probability (confidence) forproved+probable of at least 50% that the estimated quantities will be
recovered.
POSIBBLE RESERVES
- low degree of certainty means a probability (confidence) forproved+probable+possible of at least 15% that the estimated quantities will be
recovered.
R C t
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ULTIMATE RECOVERY
- Discovered
- UR = Np + Reserves- Commercial
- Producing fields
- Firm development
POTENTIAL RECOVERY
- Discovered
- Not producible due :Economic,Political,
Environmental or Technological
reasons
- Insufficient /inconclusive data
SPECULATIVE RECOVERY
- Undiscovered
- Unproven trap- Deeper reservoir
in producing
field
P1
P2P3
ODT
EOWC
SPILL
P1 P4P4
P6
P5
OWC
GDT
P4P5P6
?
EOWC?
SPILL?
LOW
EXPECTED
HIGH
BLOCK1 BLOCK2 BL
BLOCK 1 BLOCK 2 BLOCK 3
Recovery Category
P t ti O tli
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Presentation Outline
Overview
Definitions & Classification
Estimation & Reconciliation
Reporting
Conclusion
R l R E ti ti
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Rules on Reserves Estimation
Reserves estimation is an imprecise science
No right way to estimate reserves
Dependent data quality, quantity and experiences
Risk and uncertainty
Right answer at the end of field life
Reso rce Estimation Approaches
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Resource Estimation Approaches
Deterministic method
Probabilistic method
Integrated method
- P1 (proved), P2 (probable) : deterministic
- P3 (possible) : probabilistic
- C1, C2, C3 : confidence factor
- Expected value ( EV ) = P1*C1 + P2*C2 + P3*C3
Reserves Estimation
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Reserves Estimation
Proved 85%
Proved + Probable
50%
Proved + Probable + Possible 15%
Reconciliation
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DETERMINISTIC
OUTPUT
PROVED = P1
PROBABLE = P2
POSSIBLE = P3
EXPECTED VALUE (EV)
= P1XC1 + P2XC2 + P3XC3 or
= P1+ 2/3 P2 + 1/3 P3
( If Log Normal Distribution )
1P > 85%
2P > 50%
3P > 15%
ASSOCIATEDCONFIDENCE OF
RECOVERY
PROBABILISTIC
OUTPUT
PROVED
EXPECTED
HIGH
> 85%
> 50%
> 15%
ASSOCIATEDCONFIDENCE OF
RECOVERY
EV
NOTE : P1 ARE SUMMED ARITHMETICALLY (ACCEPTED INDUSTRY PRACTISE)
EV ARE SUMMED ARITMETICALLY
Reconciliation
Presentation Outline
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Presentation Outline
Overview
Definitions & Classification
Estimation & Reconciliation
Reporting
Conclusion
Reporting Principles
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Reporting Principles
Consistent with definitions & classification
Transparent & auditable ( input / output )
Total resources / field life cycle
Multiple business and technical applications
Expected Value (EV)
- Planning- Booked number
- Summation,
- Reconciliation
Dynamic Reporting System
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RESOURCE MIGRATION
CERTAIN
(Produced)COMMERCIAL
(Discovered)
NON-
COMMERCIAL
(Discovered)
SPECULATIVE
(Undiscovered)
DEVELOPMENT
RECOVERABLE
PETROLEUM IN-PLACE
PRODUCTION
VOLUMETRIC
HIERACHY
Dynamic Reporting System
Resources Reporting
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SUMMATION
DETERMINISTIC
PROBABILISTIC
INTEGRATED
Proved
EV
Proved
EV
Proved
Probable
Possible
EV
Proved
Expectation
High
Proved
Expectation
High
Proved
Probable
Possible
EV
RESERVES STATUS
Developed
Undeveloped
Proved
EV
Resources Reporting
METHODS
REPORTING
Proved
EV
Standard Legend for Fluid Types
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Standard Legend for Fluid Types
BLACK / WHITE COLOUR HYDROCARBON CATEGORY
UNDISCOVERED - LEAD
PROBABLE GAS / POSSIBLE OIL
UNDISCOVERED - PROSPECT
PROVED GAS
PROBABLE GAS
PROVED OIL
DISCOVERED - HYDROCARBON
POSSIBLE GAS
PROBABLE OIL
PROBABLE OIL / POSSIBLE GAS
POSSIBLE OIL
PROVED WATER
Map
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Map
Fluid Contacts : The Half - Way Concept
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The categories and halfway concept
may be over ridden by some othergeological, geophysical and
engineering data or which the basis
and assumptions must be clearly
stated
Fluid Contacts : The Half Way Concept
Discovered Crude Oil Resources Summary :Potential Recovery ( PR ) Category
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Potential Recovery ( PR ) Category
FIELD : Mala
UNIT : MILLION STOCK TANK BARRELS (MMSTB)
Remarks : Economic , Technology , Environment, Political
RESERVOIR
Reservoir 1
Reservoir 2
Reservoir 3
Reservoir 1
Reservoir 2
Reservoir 3
BLOCK 1
BLOCK 2
Sub-Total
Sub-Total
FIELDTOTAL
PROVED POSSIBLEPROBABLE EV RF PROVED POSSIBLEPROBABLE EV
STOIIP POTENTIALRECOVERY REMARKS
0.00.0 0.00.00.0 0.0 0.0 0.0
Presentation Outline
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Presentation Outline
Overview
Definitions & Classification
Estimation & Reconciliation
Reporting
Conclusion
Conclusion
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Conclusion
The definitions , classification and
reporting should cover the full range of
petroleum resources inventory in meeting
various business and technical
applications.