Defining Features of Proved Reserves

 

An oil and natural gas company based in Calgary, Ambit Energy Corporation also maintains offices in the United Kingdom and Nigeria. Ambit Energy Corporation focuses its drilling efforts on Nigeria’s Niger Delta Basin. Currently the 12th-largest petroleum system in the world, the Niger Delta Basin features proved reserves totaling 35 billion barrels.

According to the Society of Petroleum Engineers, the term “proved reserves” refers to reserves of petroleum that can be recovered in commercial quantities. Using engineering and geological data, engineers must establish at least a 90 percent probability that quantities recovered will exceed the estimated value. Proved reserves also must take into account current economic conditions, such as corporate procedures, government regulations, and historic petroleum prices. As such, the same quantity of petroleum may qualify as commercially recoverable in certain economic climates and fail to qualify in others.

In most cases, proved reserves must determine commercial producibility via actual formation or production tests. Common metrics include core analysis and well logs, which are compared to hydrocarbon production in similar reservoirs nearby.

Differences in PRMS Resource Classes

Founded in 2005 as a privately held oil and gas company, Ambit Energy Corporation sets out to identify and acquire participating interests in promising oil and natural gas projects in West Africa. Currently focusing on the Niger Delta Basin in Nigeria, Ambit Energy Corporation looks to purchase proved producing and proved non-producing assets in the region.

According to the Petroleum Resources Management System (PRMS) established by the Society for Professional Engineers, oil and gas resources can be classified in a number of different ways based on chance of commerciality. The term “reserves” refers to resources that can be commercially recovered and used for additional development. Reserves feature a high degree of certainty regarding commercial viability.

Contingent resources rank below reserves in terms of certainty. Although potentially recoverable, contingent reserves are typically not mature enough to meet the technological or business standards for commercial activity. The lowest resource category involves prospective resources, which include estimated volumes of accumulations that have not yet been discovered. For this reason, prospective resources carry the highest levels of risk for investment.

Geology of the Niger Delta - The Agbada Formation

A firm in the oil and gas sector dedicated to discovering and utilizing petroleum resources in West Africa, Ambit Energy Corporation is currently engaged in projects in the resource-rich Niger Delta Basin in Nigeria. Ambit Energy Corporation plans to create value for its shareholders by developing the region's oil reserves in the tens of billions of barrels.

The Niger Delta's richness in oil and gas owes to its geological history going back millions of years. The Agbada formation, the most energy-rich part of the Niger Delta, ranks among the top 12 regions in the world in terms of recoverable petroleum resources. The region has the potential to yield nearly 35 billion oil barrels and over 90 trillion cubic feet in natural gas.

The resource accumulation in the region occurred over three geologic phases. The first happened in the Paleocene, about 65 million years ago. Following the Paleocene, the second event occurred in the Eocene, roughly 55 million years ago. The last event is dated to the Oligocene, or approximately 34 million years ago.

Opportunity for Success - Oil and Gas Operations in Nigeria

Headquartered in Canada with offices in Nigeria and the United Kingdom, Ambit Energy Corporation works to capitalize on oil and gas exploration and production opportunities along Nigeria’s Niger Delta Basin. Ambit Energy Corporation’s strategic corporate structure and targeted exploration and production efforts are designed to provide reliable returns for company shareholders.

There are a number of advantages to investing in oil and gas in Nigeria due to the country’s physical and financial characteristics. For example, a recent Statistical Review of World Energy report from BP indicates that the country is among Africa’s top producers of both oil and gas. The report further stated that Nigeria contains the second-greatest oil reserves and the most significant gas reserves in Africa. Along with these strong performance indicators, data shows that Nigeria yields $40 billion in upstream investment on average each year and currently maintains status as the world’s 12th-biggest oil producing nation.

Experts also note that investors benefit from Nigeria’s favorable oil extraction costs. In the Niger Delta, the Unit Technical Cost of extraction is often $30 less per barrel than in the North Sea region. Despite the currently low price-per-barrel for oil, extraction and production operations in Nigeria still offer positive profit margins that can be beneficial for investors.                            

Niger cis One of World’s Largest Oil-producing Regions

An international energy corporation headquartered in Canada, Ambit Energy Corporation aims to become a leader in West Africa’s emergent energy sector. Initially, Ambit Energy Corporation is focusing its activities in Nigeria, the largest oil producer on the African continent. Much of the country’s oil and gas production today has occurred in the Niger Delta Basin region, located in Southern Nigeria.

As one of the world’s largest petroleum systems, the Niger Delta Basin has an average output of two million barrels of oil per day, with projected reserves of 34.5 billion barrels of oil. Over a period of 55 years, energy companies produced 47 billion barrels of oil. Energy industry experts say that companies can find even more oil reserves by drilling deeper.

As energy firms continue to explore the Niger Delta Basin, others are beginning to eye potential opportunities in the country’s central and northern territories. In addition, some international oil companies have limited their involvement in onshore oil production and begun to focus in deep-water operations near the coast of Nigeria.