Transcript No Slide Title

AN INTEGRATED APPROACH TO PETROLEUM
RESOURCES DEFINITIONS,
CLASSIFICATION AND REPORTING
Rosly Mohd Nor
PETRONAS CARIGALI
Presentation Outline
 Overview
 Definitions & Classification
 Estimation & Reconciliation
 Reporting
 Conclusion
Objectives

To share some of the industry’s practices
in resources / reserves definitions,
classifications , issues and challenges.
 To
share PETRONAS’s experiences in
developing and application of its resources
definitions ,classification and reporting in
its international ventures.
The Mckelvey Box (1972 )
Identified
Proved
Probable
Undiscovered
Possible
RESERVES
RESOURCES
Degree of certainty
Petroleum Society of Canadian Institute of Mining (1994)
Resources
Undiscovered Resources
or
Initial Volumes in Place
Initial
Reserves
Cumulative
Production
Sales
Inventory
Unrecoverable
Volumes
Remaining
Reserves
Remaining
Proved
Reserves
Proved Developed
• Producing
• Non Producing
Proved Undeveloped
Undiscovered Resources
or
Future Initial Volumes in Place
Probable
Reserves
Future Initial
Reserves
• Currently Uneconomic Volumes
• Residual Unrecoverable Volumes
Possible
Reserves
Probable
Developed
Possible
Developed
Probable
Undeveloped
Possible
Undeveloped
Future Unrecoverable
Volumes
Caldwell & Heather, The Scotia Group , JPT (1995)
DISCOVERED
RESERVES
PROVED PROBABLE
UNDISCOVERED
POSSIBLE
ECONOMIC
Low Price
Undiscovered,
economically
recoverable resources
ECONOMIC
FEASIBILITY
OF RECOVERY
Medium Price
High Price
SUB
ECONOMIC
Discovered but not
economically recoverable
resources
Undiscovered,
not economically
recoverable resources
TECHNICAL CERTAINTY OF EXISTANCE
Patricelli & McMichael, Mobil, JPT (1995)
Discovered
Reserves
(Economic, currently
Producible)
Proved Probable Possible
P1
P2
P3
Undiscovered
Contingent
Resources
(Uneconomic, not
currently producible)
Speculative
Potential
Proved Probable Possible
P4
P5
P6
Associated Confidence Factors
Geological Risk
Pg
PETRONAS (1997)
RESOURCES
DISCOVERED
UNDISCOVERED
ULTIMATE
RECOVERY (UR)
CUMULATIVE
PRODUCTION
PROVED
(P1)
POTENTIAL
RECOVERY (PR)
SPECULATIVE
RECOVERY (SR)
RESERVES
PROVED
(P4)
UNPROVED
PROBABLE
(P2)
POSSIBLE
(P3)
UNPROVED
PROBABLE
(P5)
LOW
POSSIBLE
(P6)
EXPECTED
HIGH
CCOP (1999)
Committee for Coastal and Offshore Geoscience Programmes
PETROLEUM
RESOURCES
DISCOVERED
RESOURCES
DEVELOPED
RESERVES
UNDEVEL.
RESERVES
HYPOTHETICAL
RESOURCES
POTENTIAL
RESOURCES
RESERVES
PROVED
RESERVES
UNDISCOVERED
RESOURCES
UNPROVED
RESERVES
PROBABLE
RESERVES
LOW
EXP.
HIGH
SPECULATIVE
RESOURCES
LOW
EXP.
HIGH
POSSIBLE
RESERVES
CCOP Members : Cambodia , China, Indonesia, Japan, Malaysia, Papua New Guinea,
The Philippines, Republic of Korea, Singapore, Thailand, Vietnam
SPE (2000)
PRODUCTION
RESERVES
PROVED
PROVED
PROVED
PLUS
PROBABLE
PLUS
PROBABLE
PLUS
POSSIBLE
CONTINGENT
RESOURCES
LOW
ESTIMATE
BEST
ESTIMATE
HIGH
ESTIMATE
UNRECOVERABLE
PROSPECTIVE
RESOURCES
LOW
ESTIMATE
BEST
ESTIMATE
UNRECOVERABLE
RANGE OF UNCERTAINTY
HIGH
ESTIMATE
Resource Uncertainty Categories
Society of Petroleum
Engineers (SPE )
DETRMINISTIC
World Petroleum
Congress ( WPC )
Former Soviet Union
PROBABILISTIC
CATEGORY
• Proved
• P1 ( 90% confidence )
• Class A and B
• Probable
• P1 + P2 ( 50 % confidence )
• Class C1
• Possible
• P1 + P2 + P3 (10 % confidence )
• Class C2
Presentation Outline
• Overview
 Definitions & Classification
• Estimation & Reconciliation
• Reporting
• Conclusion
Key Reference
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
PETRONAS (1997)
RESOURCES
DISCOVERED
UNDISCOVERED
ULTIMATE
RECOVERY (UR)
CUMULATIVE
PRODUCTION
PROVED
(P1)
POTENTIAL
RECOVERY (PR)
SPECULATIVE
RECOVERY (SR)
RESERVES
PROVED
(P4)
UNPROVED
PROBABLE
(P2)
POSSIBLE
(P3)
UNPROVED
PROBABLE
(P5)
LOW
POSSIBLE
(P6)
EXPECTED
HIGH
Key Principles
 International standards and practices
 Business & technical applications
 Total resources / Field life cycle
 Risk & uncertainty quantification
 Reporting consistency & transparent
 Flexible & Robust
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
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
Definition : Resources
“ Resources ” are defined as the total
estimated quantities of petroleum at a
specific date to be contained in, or that
have been produced from known
accumulations, plus those estimated
quantities in accumulations yet to be
discovered.
Definition : Undiscovered Resources
“ Undiscovered Resources ” are defined
as the the total estimated in-place of
petroleum at a specific date to be
contained in accumulations yet to be
discovered.
Definition : Discovered Resources
“ Discovered Resources ” is defined as
the total estimated in-place quantities of
petroleum at a specific date to be
contained in known accumulations that
have been penetrated by a wellbore.
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 of
petroleum which if present, may
eventually be recovered.
Definition : Potential Recovery ( PR )
“ Potential Recovery ” is defined as the
discovered resources that are recoverable
but not producible at a specific date due to
economic, political, environmental or
technological reasons.
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
Definition : Ultimate Recovery ( UR )
“ Ultimate Recovery ” is defined as the
discovered 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.
Definition : Reserves
“ Reserves ” is defined as the total
estimated remaining quantities of
petroleum anticipated to be commercially
recoverable from known accumulations at
a specific date, under existing economic
conditions, by establishes operating
practices and under current government
regulations.
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) for
proved+probable of at least 50% that the estimated quantities will be
recovered.
POSIBBLE RESERVES
- low degree of certainty means a probability (confidence) for proved+
probable+possible of at least 15% that the estimated quantities will be
recovered.
Recovery Category
ULTIMATE RECOVERY
POTENTIAL RECOVERY
SPECULATIVE RECOVERY
- Discovered
- Discovered
- Not producible due :
Economic,Political,
Environmental or Technological
reasons
- Insufficient /inconclusive data
- Undiscovered
- Unproven trap
- Deeper reservoir
in producing
field
- UR = Np + Reserves
- Commercial
- Producing fields
- Firm development
G
D
T
O
W
C
P
6
P
5
P
1
P
2
P
3
P
4
P
4
P
4
P
5
P
6
L
O
W
H
I
G
H
ESP OWC?
IL?
P
1
E
X
P
E
C
T
E
D
O
D
T
?
E
O
W
C
S
P
I
L
L
B
L
O
C
K
1
BLOCK 1
B
L
O
C
K
2
BLOCK 2
B
L
O
C
K
3
BLOCK 3
Presentation Outline
•
Overview
• Definitions & Classification
 Estimation & Reconciliation
• Reporting
• Conclusion
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
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
 Proved 85%
 Proved + Probable  50%
 Proved + Probable + Possible 15%
Reconciliation
DETERMINISTIC
OUTPUT
PROBABILISTIC
ASSOCIATED
CONFIDENCE OF
RECOVERY
OUTPUT
ASSOCIATED
CONFIDENCE OF
RECOVERY
EV
PROVED = P1
1P > 85%
PROVED
> 85%
PROBABLE = P2
2P > 50%
EXPECTED
> 50%
POSSIBLE = P3
3P > 15%
HIGH
> 15%
EXPECTED VALUE (EV)
= P1XC1 + P2XC2 + P3XC3 or
= P1+ 2/3 P2 + 1/3 P3
( If Log Normal Distribution )
NOTE : P1 ARE SUMMED ARITHMETICALLY (ACCEPTED INDUSTRY PRACTISE)
EV ARE SUMMED ARITMETICALLY
Presentation Outline
•
Overview
• Definitions & Classification
• Estimation & Reconciliation
 Reporting
• Conclusion
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
RESOURCE MIGRATION
CERTAIN
(Produced)
COMMERCIAL
(Discovered)
NONCOMMERCIAL
(Discovered)
PRODUCTION
VOLUMETRIC
HIERACHY
DEVELOPMENT
RECOVERABLE
PETROLEUM IN-PLACE
SPECULATIVE
(Undiscovered)
Resources Reporting
REPORTING
SUMMATION
METHODS
DETERMINISTIC
PROBABILISTIC
INTEGRATED
RESERVES STATUS
Developed
Undeveloped
Proved
Probable
Possible
EV
Proved
EV
Proved
Expectation
High
Proved
Expectation
High
Proved
Probable
Possible
EV
Proved
EV
Proved
EV
Proved
EV
Standard Legend for Fluid Types
BLACK / WHITE
COLOUR
HYDROCARBON CATEGORY
UNDISCOVERED - LEAD
UNDISCOVERED - PROSPECT
PROVED GAS
PROVED OIL
PROVED WATER
DISCOVERED - HYDROCARBON
PROBABLE GAS / POSSIBLE OIL
PROBABLE OIL / POSSIBLE GAS
PROBABLE GAS
POSSIBLE GAS
PROBABLE OIL
POSSIBLE OIL
Map
Fluid Contacts : The Half - Way Concept
The categories and halfway concept
may be over ridden by some other
geological, geophysical and
engineering data or which the basis
and assumptions must be clearly
stated
Discovered Crude Oil Resources Summary :
Potential Recovery ( PR ) Category
FIELD : Mala
UNIT : MILLION STOCK TANK BARRELS (MMSTB)
STOIIP
RESERVOIR
PROVED
PROBABLE
POSSIBLE
REMARKS
POTENTIAL RECOVERY
EV
RF
PROVED
PROBABLE
POSSIBLE
EV
0.0
0.0
0.0
0.0
BLOCK 1
Reservoir 1
Reservoir 2
Reservoir 3
Sub-Total
BLOCK 2
Reservoir 1
Reservoir 2
Reservoir 3
Sub-Total
FIELD TOTAL
0.0
0.0
0.0
0.0
Remarks : Economic , Technology , Environment, Political
Presentation Outline
•
Overview
• Definitions & Classification
• Estimation & Reconciliation
• Reporting
 Conclusion
Conclusion
The
definitions
,
classification
and
reporting should cover the full range of
petroleum resources inventory in meeting
various
business
applications.
and
technical