Thursday, July 21, 2016
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.