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SPE Reserves & Resources Workshop – Perth, Australia

In June ERCE’s Adam Becis and Mike Cuthbertson attended the Society of Petroleum Engineers International Workshop: Reserves and Resources Estimation in Perth, Australia.

During the workshop Adam presented on “Ensuring Consistency in Resource Estimation Techniques”. A wide range of other topics was covered during the workshop with areas of focus including the 2018 SPE PRMS, regulatory & financing perspectives, economics & commerciality, new technology and unconventional resources.

Keep reading below for a summary of the ERCE presentation from the Workshop.

Ensuring Consistency in Resource Estimation Techniques

As resources progress through the exploration and production cycle, the way in which they are evaluated also changes. Evaluators must ensure their estimates and approaches are consistent across different methodologies. Reporting guidelines (e.g. PRMS, COGEH) must always be considered and adhered to. For dual-listed companies, evaluations must be consistent with the multiple sets of applicable guidelines.

Stages of Field Life

First Phase – Exploration

Key Considerations:

  • Creaming curve of discoveries in the basin
  • Analogue discoveries and/or developments

Key Challenges:

  • Lack of data
  • High uncertainty
  • Lack of analogues

Typical Methodologies:

  • Volumetric approach
    • Seismic mapping
    • Statistical variation (SGS)
    • Properties from offset wells
  • Recovery factors from analogues
    • Comparable reservoir, depth, temperature, drive mechanism etc.
  • Deterministic or probabilistic methods
    • Low – Best – High maps
    • Monte-Carlo simulations

Example – Onshore Acreage

  • Sparse 2D seismic coverage
  • Significant uncertainty

Methodology Used

  • Mapping low and high case areas to capture range in possible closures
  • Reservoir properties from old wells (exact locations unknown)
  • Recovery factor range from analogues


  • Defining high case closures that give a sufficiently wide range of resources
  • Considering appropriate reservoir properties for an area that will likely contain multiple facies types (reefs/slope/lagoon)

Phase 2 – Development

Key Considerations:

  • Well data now available
  • Is there a development plan?

Key Challenges:

  • Reservoir and fluid complexity
  • Still significant uncertainty
  • Reconciliation of models with analogues

Typical Methodologies

  • Volumetric approach
    • Seismic mapping
    • Properties from exploration/appraisal wells
    • Recovery factors from analogues
  • Can be an analytical or model-based approach dependent on resource size & type
    • Material balance
    • Static and dynamic modelling
    • Deterministic or multi-realisation
    • Reconciliation with other methods
    • Useful for screening development scenarios to include in FDP


Example – Offshore Pre-Development

Early years…

  • No defined development plan
  • No modelling work from the Operator
  • Evaluation based on volumetric approach with heavy reliance on analogue fields for recovery factor range
  • Contingent Resources – Development Unclarified

More recently…

  • A fully approved development plan
  • Low, Best and High case simulation models
  • Evaluation is now based on modelling work but importantly the results must be reconciled with volumetric approach and analogue fields
  • Reserves – Approved for Development
  • At this stage economics become an important aspect of the evaluation – economic limit

Source: Shutterstock by Wan Fahmy Redzuan

Phase 3 – Production

Key Considerations:

  • How much production data?
  • How much of the field is being developed?
  • Quantifying the reduction in uncertainty?

Key Challenges:

  • Poorly defined performance trends
  • Performance reveals more complexity than anticipated
  • History matching of dynamic models

Typical Methodologies:

  • Volumetric approach
    • Seismic mapping
    • Properties from expl/appr/dev wells
    • Recovery factors from analogues
  • Model based approach
    • Static and dynamic modelling
    • Deterministic or multi-realisation
    • Reconciliation with other methods
  • Performance based approach
    • Decline curve analysis
    • Material balance
    • Type wells

Examples – Onshore & Offshore Fields


  • 6 years of production, 16 producers
  • Existing well forecasts use DCA
  • Infill well EUR based on local volumetrics and recovery factor, reconciled with EUR/well stats


  • 4 years of production, ~10 producers
  • Forecasts based on history matched simulation model
  • Quality of history match affects quality of forecasts
  • Simulation forecasts should be reconciled with well by well DCA if possible

Phase 4 – Late-Life

Key Considerations:

  • Heavy reliance on performance
  • More confidence in performance-based approaches than volumetric based approaches but we should still attempt to reconcile with volumetrics and RFs

Key Challenges:

  • Reconciling models/forecasts with production history and field statistics (e.g. average EUR per well)
  • Modelling certain late-life activities such as waterflooding or EOR
  • Consideration of missed opportunities including behind pipe resources
  • Changing operating conditions (e.g. compression, artificial lift)

Typical Methodologies:

  • Performance based approach
    • Decline curve analysis (existing wells)
    • Material balance (e.g. P/Z)
    • Field/well statistics
    • Type wells
  • Model/analytical based approach
    • Static and dynamic modelling
    • Only in larger fields
    • Helpful for planning infill wells
  • Volume based approach
    • Not as important for forecasting but a necessary benchmark for expected recovery factors

Example – Onshore Field

  • Field has been on production since early 1900s with documented production history since pre-1960
  • Currently 100+ producing wells which are forecasted using DCA at a fault block level
  • Operator has an infill drilling campaign over the next 5 years
    • Infill well EUR estimated using statistics of historical wells (e.g. well EUR vs cumulative field production, well EUR vs date drilled) and benchmarked against expected RF
    • Initial rates and decline rates based on recent infill well performance
  • Operator has started a waterflooding campaign in pilot areas and plans to roll out to other blocks
    • Waterflooding in late-life fields extremely uncertain due to pressure below Pb and secondary gas caps
    • Volumetric approach reconciling current RF and potential incremental gain from waterflooding
    • No simulation model available

PRMS vs COGEH Example

Summary and Conclusion

  • As resources mature, the methods by which they are evaluated change
  • Ensure consistency in resource evaluation by reconciling results across different methods
  • Make sure evaluations are consistent with the appropriate reporting standards