Page 285 - Standard Handbook Petroleum Natural Gas Engineering VOLUME2

454 Reservoir Engineering

prices, costs, and markets prevailing at the time of the estimate. Other assumed
future economic conditions may lead to different estimates of recoverable
volumes; these volumes are not considered reserves under existing economic
conditions constraints, but may be identified as resources.
Marketable means that facilities to process and transport reserves to market
are operational at the time of the estimate, or that there is a commitment to
install such facilities in the near future, and there is a readily definable market
or sales contract. Reserve estimates generally will be revised as reservoirs are
produced, as additional geologic and/or engineering data become available, or
as economic conditions change.
Natural gas reserves are those volumes which are expected to be produced
and that may have been reduced by onsite usage, by removal of nonhydrocarbon
gases, condensate or natural gas liquids.
Reserves may be attributed to either natural reservoir or improved recovery
methods. Improved recovery includes all methods for supplementing natural
reservoir energy to increase ultimate recovery from a reservoir. Such methods
include (1) pressure maintenance, (2) cycling, (3) waterflooding, (4) thermal
methods, (5) chemical flooding, and (6) the use of miscible and immiscible
displacement fluids. Reserves attributed to improved recovery methods usually
will be distinguished from those attributed to primary recovery.
All reserve estimates involve some degree of uncertainty, depending chiefly
on the amount and reliability of geologic and engineering data available at the
time of the estimate and the interpretation of these data. The relative degree
of uncertainty may be conveyed by placing reserves in one of two classifications,
either proved or unproved. Unproved reserves are less certain to be recovered
than proved reserves and may be subclassified as probable or possible to denote
progressively increasing uncertainty.
Classification of Reserves

Proved Reserves. Attributed to known reservoirs, proved reserves can be
estimated with reasonable certainty. In general, reserves are considered proved
if commercial producibility of the reservoir is supported by actual production
or formation tests. The term proved refers to the estimated volume of reserves
and not just to the productivity of the well or reservoir. In certain instances,
proved reserves may be assigned on the basis of a combination of core analysis
and/or electrical and other type logs that indicate the reservoirs are analogous
to reservoirs in the same areas that are producing, or have demonstrated the
ability to produce in a formation test. The area of a reservoir considered proved
includes (1) the area delineated by drilling and defined by fluid contacts, if any,
and (2) the undrilled areas that can be reasonably judged as commercially
productive on the basis of available geological and engineering data. In the
absence of data on fluid contacts, the lowest known structural occurrence of
hydrocar3ons controls the proved limit unless otherwise indicated by definitive
engineering or performance data.
In general, proved undeveloped reserves are assigned to undrilled locations
that satisfy the following conditions: (1) the locations are direct offsets to wells
that have indicated commercial production in the objective formation, (2) it is
reasonably certain that the locations are within the known proved productive
limits of the objective formation, (3) the locations conform to existing well
spacing regulation, if any, and (4) it is reasonably certain that the locations will
be developed. Reserves for other undrilled locations are classified as proved
undeveloped only in those cases where interpretation of data from wells indicates