Reserves and reservoir

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  • Reserves, contingent resources, and prospective resources involvedifferent risks associated with achieving commerciality.
  • Reserve Estimation Methods: More than one available.• Different methods applicable at different stages ofdevelopment.• Data requirement different for each method, with somecommon• predominant methods:
  • • Uncertainties associated with each method• More than one method should be used when applicable
  • Reserves and reservoir

    1. 1. RESOURCES AND RESERVES © 2012 INSTITUTE OF TECHNOLOGY PETRONAS SDN BHD All rights reserved. No part of this document may be reproduced, stored in a retrieval system or transmitted in any form or by any means (electronic, mechanical, photocopying, recording or otherwise) without the permission of the copyright owner.
    2. 2. Presentation Contents • Reservoir Engineering – Primary functions – Applications • Resources – Key Elements – Discovered Vs. Undiscovered • Reserves – Classification – Development and Production status – Levels of uncertainty – Estimation
    3. 3. Reservoir
    4. 4. RESERVOIR ROCK • A substance body of rock having sufficient porosity and permeability to store and transmit fluids .
    5. 5. RESERVOIR ENGINEERING • The phase of engineering which deals with the transfer of fluids to, from or through the reservoirs • It is located at the heart of many of the activities acting as a central coordinating role.
    6. 6. THE PRIMARY FUNCTIONS OF A RESERVOIR ENGINEER The estimation of hydrocarbons in place The calculation of a recovery factor The attachment of a time scale to the recovery
    7. 7. GOAL OF RESERVOIR ENGINEERING. Set up development project Optimize hydrocarbons recovery Study on production forecasting
    8. 8. CALCULATION OF HYDROCARBON VOLUMES • Initially filled with liquid oil. • The oil volume in the reservoir (oil in place) is: OIP = Vφ (1− Swc )(res.vol.) • V = the net bulk volume of the reservoir rock • φ = the porosity, or volume fraction of the rock which is porous • Swc = the connate or irreducible water saturation and is expressed as afraction of the pore volume.
    9. 9. THE STOCK TANK OIL INITIALLY IN PLACE • To express oil volumes at stock tank (surface) conditions: STOIIP = n = Vφ (1− Swc ) /Boi • Boi is the oil formation volume factor, reservoir barrels/stock tank barrel (rb/stb).
    10. 10. RESERVOIR ENGINEERING APPLICATION Determine HC in place • Volumetric Method • Material balance Determine Reserves • Primary Recovery Phase • Supplemental Recovery Phase Determine Rates • Number of wells • Well potential
    11. 11. RESERVOIR ENGINEERING APPLICATION • Determine HC in place  Volumetric Method  Area  Thickness  Porosity  Saturation  Material balance  Production Data  Fluid Properties Fig(1) Anticline Petroleum Trap
    12. 12. RESERVOIR ENGINEERING APPLICATION • Determine Reserves  Primary Recovery  Gas cap drive  Water drive  Gravity drainage  Combination  Supplementary Recovery Phase  Secondary Recovery  EOR • Determine Rates  Number of wells  Well potential Fig (2) CO2 Injection
    13. 13. Resources
    14. 14. Total quantity of discovered and undiscovered petroleum at a specific date in a given area. GENERAL DEFINITION OF RESOURCES
    15. 15. Total Petroleum Initially In Place (TPIIP Total Resources) Undiscovered PIIP Discovered PIIP Recoverable • Production • Reserves • Contingent resources Unrecoverable Recoverable • Prospective recourses Unrecoverable KEY ELEMENTS OF RESOURCES
    16. 16. • quantity of petroleum that is estimated to exist originally in naturally occurring accumulations • Discovered or yet to be discovered (equivalent to “total resources”) TOTAL PETROLEUM INITIALLY-IN-PLACE (TPIIP)
    17. 17. DISCOVERED (PIIP) The total estimated in place quantities of petroleum at a specific date to be contained in known accumulations, plus those quantities already produced from there UNDISCOVERED (PIIP) Quantity of petroleum that is estimated, as of a given date, to be contained in known accumulations yet to be discovered DISCOVERED VS UNDISCOVERED PIIP
    18. 18. DISCOVERED RESOURCES PRODUCTION Cumulative quantity of petroleum that has been recovered up to a given date RESERVES = ? CONTINGENT RESOURCES To be potentially recoverable from known accumulations, but the applied projects are not yet considered mature enough for commercial development due to one or more contingencies
    19. 19. UNDISCOVERED PROSPECTIVE RESOURCES Quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective Resources have both an associated chance of discovery and a chance of development.
    20. 20. Reserves
    21. 21. Reserves Reserves Classification Proved Reserves Probable Reserves Possible Reserves Development and production status Developed Reserves Producing Non- producing Undeveloped Reserves Levels of uncertainty General Classification Requirements DEFINITION OF RESERVESGENERAL OVERVIEW OF RESERVES
    22. 22. DEFINITION OF RESERVES Quantities of petroleum Anticipated to be COMMERCIALLY RECOVERED from KNOWN ACCUMULATIONS (already discovered). from a given date forward (excluding previously produced amounts)
    23. 23. CONDITION FOR TO BE CALLED RESERVES Oil and gas must be physically and economically producible Since reservoir is not produced and is inaccessible, reserves cannot be measured, they can only be estimated Since reserves are remaining, there is a time line associated with each reserve estimated
    24. 24. RESERVES ESTIMATION • Analysis of drilling, geological, geophysical, and engineering data • The use of established technology • Specified economic conditions, which are generally accepted as being reasonable, and shall be disclosed
    25. 25. RESERVES CATEGORY Reserves are classified according to the degree of certainty associated with the estimates. POSIBBLE PROBABLE PROVED
    26. 26. RESERVES CATEGORY PROVED RESERVES • Reserves estimated with a high degree of certainty to be recoverable • Likely situation : Actual remaining quantity > estimated proved results PROBABLE RESERVES • Additional reserves that are less certain to be recovered than proved reserves • sum of estimated proved + probable reserves<Actual remaining quantity<sum of estimated proved + probable reserves POSSIBLE RESERVES • Less certain to be recovered • Likely situation : Actual remaining quantity <sum of estimated proved reserves+ probable reserves + Possible reserves
    27. 27. FURTHER CLASSIFICATION Each of the reserves categories (proved, probable, and possible) may be further divided into developed and undeveloped categories. DEVELOPED • expected to be recovered from existing wells and installed facilities • Or if facilities have not been installed, that would involve a low expenditure to put on production RESERVES UNDEVELOPED expected to be recovered from known accumulations where a significant expenditure is required to render them capable of production. DEVELOPED PRODUCING • expected to be recovered from completion intervals open at the time of the estimate (Currently producing) • If well is shut in, the date of resumption of production is known DEVELOPED NON-PRODUCING • Is not put on production yet • produced before, but currently shut in (date of resumption of production is unknown
    28. 28. LEVELS OF CERTAINTY IN REPORTED RESERVES Reported reserves should target the following levels of certainty under a specific set of economic conditions: POSIBBLE PROBABLE PROVED Actual remaining reserves
    29. 29. LEVELS OF CERTAINTY IN REPORTED RESERVES At least a 90 percent probability that the quantities actually recovered will equal or exceed the estimated proved reserves POSIBBLE PROBABLE PROVED Quantities actually recovered At least 90 percent probability
    30. 30. LEVELS OF CERTAINTY IN REPORTED RESERVES At least a 50 percent probability that the quantities actually recovered will equal or exceed the sum of the estimated proved + probable reserves, POSIBBLE PROBABLE PROVED Quantities actually recovered At least 50 percent probability
    31. 31. LEVELS OF CERTAINTY IN REPORTED RESERVES At least a 10 percent probability that the quantities actually recovered will equal or exceed the sum of the estimated proved + probable + possible reserves. POSIBBLE PROBABLE PROVED Quantities actually recovered At least 10 percent probability
    32. 32. RESERVE ESTIMATION – RECOVERY FACTOR  We can never recover 100% oil and gas reserves at any given reservoir  How much hydrocarbons can be recovered and the recovery factor are dependent on:  Properties of the reservoir rock and its variation throughout the reservoir  Properties of hydrocarbons  Properties of the displacing substance  Shape and extent of the reservoir
    33. 33. RESERVE ESTIMATION – RECOVERY FACTOR • Ultimate Recovery (UR) - the sum of the proven reserves at a specific time and the cumulative production up to that time UR = HCIIP x Recovery Factor (RF) Reserves = UR – Cumulative Production
    34. 34. WORLDWIDE END-OF-YEAR PROVED OIL RESERVES
    35. 35. PROVEN OIL RESERVES DISTRIBUTION
    36. 36. RELATION BETWEEN RESOURCES AND RESERVES
    37. 37. RISKS RELATED TO RESOURCES What is ‘Chance of commerciality’? The likelihood that a project will achieve commerciality Reserves: To be classified as reserves, estimated recoverable quantities must be associated with a project(s) that has demonstrated commercial viability.
    38. 38. CHANCE OF COMMERCIALITY Contingent Resources: Not all technically feasible development plans will be commercial. The commercial viability of a development project is dependent on the forecast of fiscal conditions over the life of the project.
    39. 39. CHANCE OF DISCOVERY Prospective Resources: The chance that an exploration project will result in the discovery of petroleum is referred to as the “chance of discovery.” Chance of commerciality = chance of discovery x chance of development
    40. 40. RECOURCES CLASSIFICATION FRAMEWORK
    41. 41. Current Resources
    42. 42. General requirements for classification of reservoirs Classification Requirements Ownership Drilling Testing Regulatory Infrastructure and market conditions Timing of production and development Economic requirements
    43. 43. Procedure for reserve estimation Volumetric Method Material Balance Production Decline Analysis Future Drilling and Planned Enhanced Recovery Projects
    44. 44. Volumetric Method • Early stage of reservoir development • Geology, Geophysics, Rock and Fluid properties • Recovery Factor (RF) assigned arbitrarily • No time dependency, No Production data
    45. 45. Material Balance • Involve the analysis of pressure behavior as reservoir fluids are withdrawn • A = Increase in HCPV due to the expansion of the oil phase (oil + dissolved gas). • B = Increase in HCPV due to the expansion of the gas phase (free gas in the gas cap). • C = decrease in HCPV due to the combined effects of the expansion of the connate water and the reduction in reservoir pore volume. • D = decrease in HCPV due to water encroachment (from aquifer) Underground withdrawal (oil + gas + water) = Expansion of oil + dissolved gas (A) + Expansion of gas-cap gas (B) + Reduction in HCPV (C) + Cumulative water influx (D)
    46. 46. Production Decline Analysis • Involves the analysis of production behavior as reservoir fluids are withdrawn. • Later stage of development, when production rate undergoes natural decline. • Mostly Production data • Time dependent
    47. 47. Future Drilling and Planned Enhanced Recovery Projects Additional Reserves Related to Future Drilling factors to be considered in classifying reserves estimates associated with future drilling as proved, probable, or possible: • whether the proposed location directly offsets existing wells or acreage with proved or probable reserves assigned, • the expected degree of geological continuity within the reservoir unit containing the reserves, • the likelihood that the location will be drilled. Reserves Related to Planned Enhanced Recovery Projects factors to be considered in classifying reserves estimates associated with future drilling as proved, probable, or possible: • Repeated commercial success of the enhanced recovery process has been demonstrated in reservoirs in the area with analogous rock and fluid properties. • The project is highly likely to be carried out in the near future. This may be demonstrated by factors such as the commitment of project funding. • Where required, either regulatory approvals have been obtained or no regulatory impediments are expected, as clearly demonstrated by the approval of analogous projects.
    48. 48. Validation of reserves estimates Through periodic reserves reconciliation of both entity and aggregate estimates. The tests described below should be applied to the same entities or groups of entities over time, excluding revisions due to differing economic assumptions: • Revisions to proved reserves estimates should generally be positive as new information becomes available. • Revisions to proved + probable reserves estimates should generally be neutral as new information becomes available. • Revisions to proved + probable + possible reserves estimates should generally be negative as new information becomes available.
    49. 49. THANK YOU © 2013 INSTITUTE OF TECHNOLOGY PETRONAS SDN BHD All rights reserved. No part of this document may be reproduced, stored in a retrieval system or transmitted in any form or by any means (electronic, mechanical, photocopying, recording or otherwise) without the permission of the copyright owner.

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