Reserves (SPE-PRMS)

#Overview

Reserves (SPE-PRMS) books remaining volumes per well or reservoir as Reserves (1P/2P/3P; P1 Proved, P2 Probable, P3 Possible) or Contingent Resources (1C/2C/3C; C1/C2/C3), following the SPE Petroleum Resources Management System 2018. It tests each entity's commerciality against an economics case, rolls the bookings up, and reconciles the year from opening to closing reserves. Volumes come from Decline & RTA, Material balance, or your own entry.

Open it in the Business group of the left menu. It needs no seat; it reads the Decline, Material balance and Economics data saved in the project.

#Inputs

Use Economics module fills the economics case from the project's Economics page: the first-year oil and gas price, the royalty rate of the concession or PSC, the variable opex per barrel and per Mscf, the per-well opex divided by 12, and the NPV at 10 %. You can then edit any value.

#Methods

#Resource class

Each entity's project maturity sets its class:

An entity with a Reserves maturity is booked as Reserves only if it passes the economic test. Otherwise it is booked as Contingent Resources:

• test failed: Development Not Viable;
• no economics case: Development Unclarified.

The page notes the change on the entity, for example "Booked as Contingent Resources (Development Not Viable) instead of Reserves (On Production)."

#Economic test

The economic-limit rate of one well is the rate at which net revenue after royalty and variable cost just pays the fixed cost:

q_EL = (fixed opex $/month / 30.44 d) / (price × (1 − royalty) − variable opex per unit)

An entity fails the test when any of these holds:

• the price after royalty does not cover the variable cost per unit (no rate is economic);
• the economics case NPV at 10 % is negative;
• for a well with a current rate: the rate is at or below q_EL.

With no economics case, nothing is booked as Reserves: SPE-PRMS needs commerciality shown.

#Increments

The page keeps the cumulative scenarios and derives the increments: P1 = 1P, P2 = 2P − 1P, P3 = 3P − 2P, and the same for C1, C2 and C3.

#Volumes from Decline & RTA

From decline takes the fitted well on the Decline & RTA page and runs a bootstrap of 200 resamples:

• EUR at P90, P50 and P10, forecast to the higher of the decline page's economic limit and the economics case's q_EL;
• less the cumulative volume produced to the last data point.

The entity is a well, booked On Production and Developed Producing, with its current rate taken from the fitted decline. If the economics case sets a higher limit than the decline page, the page says so. Fit a decline first; otherwise the page asks you to.

#Volumes from Material balance

From material balance takes the history match's in-place estimates (P90, P50, P10) and multiplies them by a recovery-factor range you enter (RF low, RF best, RF high; defaults 0.25, 0.35, 0.45), less the volume produced to the last history row. Give the reservoir a Name and a Maturity, then select Add reservoir. Recovery factors must be fractions between 0 and 1 with low ≤ best ≤ high. Run a history match first.

#Manual entry

Add manually adds a row you fill in by hand.

#Workflow

1. Set the Evaluation date.
2. Under Economics case, select Use Economics module, or type the values.
3. Under Entities, add rows with From decline, From material balance or Add manually.
4. For each row, check the Project maturity / status, the low, best and high volumes and the current rate. The Booked as column shows the result.
5. Read the Roll-up.
6. Fill in the Annual reconciliation.
7. Select Export CSV.
8. Submit the project on Review & sign-off to freeze an approved reporting version.

#Interpreting results

The Roll-up shows, per product (oil and gas), the totals of P1, P2, P3, 1P, 2P, 3P and C1, C2, C3, 1C, 2C, 3C, remaining from the evaluation date. It also splits Reserves by status (Developed Producing, Developed Non-Producing, Undeveloped, or unspecified) on the 1P, 2P and 3P scenarios.

The economics panel shows the economic-limit rate per well for oil and gas, or "none (no margin)", and the NPV at 10 %.

#Annual reconciliation

Choose the Year, Product and Scenario (1P, 2P or 3P). Closing reserves are the current roll-up booking. Enter the movements as positive volumes:

Closing = Opening − Production + Revisions + Improved recovery
          + Extensions and discoveries + Acquisitions − Divestments

Leave Revisions as the balancing item (the usual practice when the closing figure is the new booking), or type a value to make the check strict. Balances shows whether the movements add up, and the imbalance if not.

The reconciliation warns when production exceeds the reserves available in the year, and when revisions exceed 25 % of opening reserves ("document the cause").

#Common pitfalls

#Exports

Export CSV downloads <project>_reserves_<evaluation date>.csv, in your display units. It holds:

• header lines: the SPE-PRMS 2018 basis, the disclaimer, the project, the evaluation date, the economics case source and the volume units;
• one row per entity: type, product, unit, source, class, sub-class, status, economic test result, P1 to 3P and C1 to 3C, and notes;
• totals per product;
• the reconciliation lines and whether they balance.

#Related

• Decline & RTA
• Material balance
• Economics
• Review and sign-off