Reserves, Possible

Test Your Knowledge

Quiz: Unlocking Potential: Understanding "Possible Reserves"

Instructions: Choose the best answer for each question.

1. Possible reserves are characterized by:

(a) High certainty of recovery
(b) Lower likelihood of recovery compared to probable reserves
(c) Proven and confirmed resources
(d) Resources already being extracted

2. The probability assigned to possible reserves in probabilistic methods is:

(a) 100%
(b) 50%
(c) 10%
(d) 25%

3. Which of the following is NOT a type of possible reserve?

(a) Beyond probable areas
(b) Proven and developed reserves
(c) Potentially productive formations
(d) Infill drilling uncertainty

4. Possible reserves are important for energy companies because they:

(a) Represent a guaranteed source of future income
(b) Offer a concrete plan for immediate resource extraction
(c) Provide a potential for future resource development
(d) Are used exclusively for regulatory reporting

5. The "P3" designation in the SPE terminology refers to:

(a) Probable reserves
(b) Possible reserves
(c) Proved reserves
(d) Proven and probable reserves

Exercise: Estimating Possible Reserves

Scenario:

An energy company is exploring a new oil field. They have identified a "proved" area containing 10 million barrels of recoverable oil. The company also estimates a "probable" area holding an additional 5 million barrels. Based on geological analysis, they believe there's a "possible" area that could hold another 15 million barrels of oil, but with a lower likelihood of recovery.

Task:

1. Calculate the total estimated oil reserves, including proved, probable, and possible reserves.
2. Briefly explain why the company might be interested in the "possible" reserves, even though they carry a lower probability of recovery.

Techniques

Unlocking Potential: Understanding "Possible Reserves" in the Energy Sector

Chapter 1: Techniques for Assessing Possible Reserves

The assessment of possible reserves relies on a combination of geological, geophysical, and engineering techniques, each contributing to a more comprehensive understanding of the subsurface potential. The inherent uncertainty associated with possible reserves necessitates a probabilistic approach, moving beyond simple deterministic estimates.

Geological Techniques: These form the bedrock of possible reserve estimation. They include:

• Seismic Interpretation: Advanced seismic imaging techniques, such as 3D and 4D seismic surveys, help identify potential reservoir formations, delineate structural features (faults, traps), and assess reservoir properties indirectly. However, interpretation remains subjective and can lead to uncertainty in the extent and quality of potential reservoirs.
• Petrophysical Analysis: Analysis of well logs (e.g., gamma ray, resistivity, neutron porosity) and core samples provides crucial information on reservoir rock properties (porosity, permeability, fluid saturation). However, extrapolating these properties to un-drilled areas introduces significant uncertainty in possible reserve estimations.
• Geochemical Analysis: Studying the composition of fluids and rocks can help identify hydrocarbon source rocks and migration pathways, aiding in the assessment of the potential for undiscovered accumulations.
• Geological Modeling: Integrating geological data into 3D geological models allows for a spatial representation of potential reservoir formations, facilitating volume calculations and uncertainty quantification. Different geological interpretations can lead to significantly different possible reserve estimates.

Geophysical Techniques: These complement geological data by providing information about the subsurface without direct drilling. Key techniques include:

• Gravity and Magnetic Surveys: These provide regional-scale information on subsurface density and magnetic susceptibility variations, potentially indicating the presence of geological structures favorable for hydrocarbon accumulation.
• Electromagnetic Surveys: These methods measure the electrical conductivity of the subsurface, which can help identify fluid-filled formations.

Engineering Techniques: These techniques contribute to understanding the feasibility of extracting possible reserves.

• Reservoir Simulation: Sophisticated reservoir simulation models can be used to assess the potential recovery factor under various scenarios, considering factors such as reservoir pressure, fluid properties, and well placement. Uncertainty in input parameters, however, significantly impacts the reliability of these simulations.
• Production Data Analysis: Analyzing historical production data from nearby fields can help in predicting the potential production performance of possible reserves, although analogies are limited and uncertainty remains high.

Chapter 2: Models for Quantifying Possible Reserves

Various models are employed to quantify possible reserves, acknowledging and quantifying the inherent uncertainty. These models often incorporate probabilistic approaches:

• Monte Carlo Simulation: This statistical technique repeatedly runs reservoir simulations using randomly sampled input parameters (e.g., porosity, permeability, net-to-gross ratio) to generate a distribution of possible reserve estimates. This provides a range of possible outcomes, capturing the uncertainty associated with these estimates.
• Fuzzy Logic: This approach allows for incorporating expert judgment and subjective assessments of uncertainty into the reserve estimation process. It assigns membership values to different levels of certainty, reflecting the ambiguity inherent in dealing with possible reserves.
• Bayesian Methods: These statistical techniques use prior knowledge and data to update estimates as more information becomes available. They are particularly useful when dealing with limited data, which is common when assessing possible reserves.
• Deterministic Methods: While less common for possible reserves due to the inherent uncertainty, volumetric methods can be applied, but they are highly sensitive to the accuracy of input parameters.

Chapter 3: Software for Possible Reserves Assessment

Numerous software packages facilitate the assessment of possible reserves. These tools often integrate geological, geophysical, and engineering data, providing advanced analytical capabilities and visualization tools:

• Petrel (Schlumberger): A widely used integrated reservoir modeling platform that incorporates functionalities for seismic interpretation, geological modeling, reservoir simulation, and uncertainty quantification.
• RMS (Roxar): Another industry-standard software package with similar capabilities to Petrel, offering tools for geological modeling, reservoir simulation, and production forecasting.
• Eclipse (Schlumberger): A powerful reservoir simulator widely used for predicting the performance of hydrocarbon reservoirs, including assessing the potential recovery of possible reserves under different development scenarios.
• Specialized Statistical Software: Packages like R or Python with relevant libraries (e.g., SciPy, statsmodels) are crucial for performing statistical analysis, Monte Carlo simulations, and Bayesian inference for uncertainty quantification.

Chapter 4: Best Practices for Possible Reserves Reporting

Transparent and consistent reporting of possible reserves is crucial for informing investment decisions and managing expectations. Best practices include:

• Clearly Defined Methodology: Detailed documentation of the techniques, models, and assumptions used in the assessment should be provided.
• Uncertainty Quantification: The range of possible reserve estimates and associated probabilities should be clearly reported, acknowledging the inherent uncertainty.
• Sensitivity Analysis: An assessment of the sensitivity of the results to key input parameters should be conducted to identify the most significant sources of uncertainty.
• Data Quality Control: Ensuring the quality and reliability of the input data is critical.
• Compliance with Standards: Adhering to industry standards and guidelines for reserve reporting (e.g., SPE PRMS) ensures consistency and comparability.
• Independent Verification: Independent review of the reserve assessment by qualified professionals can enhance credibility and reduce bias.

Chapter 5: Case Studies of Possible Reserves Assessment

Case studies demonstrating successful (and unsuccessful) assessments of possible reserves are essential for learning and improvement. These case studies should illustrate the application of different techniques and models, the challenges encountered, and the lessons learned. (Specific case studies would require detailed research and may be proprietary information. However, hypothetical examples focusing on aspects like the impact of seismic interpretation uncertainty or the success/failure of infill drilling based on prior possible reserve estimations could be included.) The case studies should also highlight the importance of transparent and rigorous methodology and the impact of various uncertainties on the final results. Finally, they should emphasize the iterative nature of possible reserves assessments, where new data constantly updates estimates and refines the understanding of the resource potential.