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Is Reserve Growth a Non-issue??

Discuss research and forecasts regarding hydrocarbon depletion.

Re: Is Reserve Growth a Non-issue??

Unread postby WebHubbleTelescope » Sat 04 Mar 2006, 21:05:26

I know all sorts of weird crap can happen deterministically, but what does this all imply statistically?

We have years of data and knowledge accumulated. We can make future estimates based on past results. This is not the stock market we are talking about. It's more like predicting the seasonal weather. I could care less that an occasional winter storm can deliver 10 feet of snow, but provide a mean and variance you can fairly judge the climate.
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Re: Is Reserve Growth a Non-issue??

Unread postby Taskforce_Unity » Sun 05 Mar 2006, 07:36:15

Where can i find this Verma paper about russian reserve growth? Link please...
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Re: Is Reserve Growth a Non-issue??

Unread postby pup55 » Sun 05 Mar 2006, 08:48:30

what does this all imply statistically


From the looks of those charts, the average may be 1.33 but the standard deviation is very broad. In other words, I would not be very comfortable to try to do a model based on this 33% reserves growth factor because there is a lot of variability in this number.

Also, there is no apparent "volume weighting", which would answer the question, is "reserves growth" dependent on field size: do "big fields" tend to be over-or under-estimated to a greater extent than small fields. 100% reserves growth in a big field will cancel out a lot of 2% growth in small fields, even though the average would be 49%.

In any case, this is a central argument in the PO debate, because as we all know, discoveries are about 7 gb per year and consumption is 30 gb per year, so if the reserves do not "grow" by at least 4.25X then only a matter of time before we go into net reserves decline, and ultimately net production decline sometime after that. Also, the 4.25 gets bigger every year as consumption increases.
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Re: Is Reserve Growth a Non-issue??

Unread postby ReserveGrowthRulz » Sun 05 Mar 2006, 10:35:11

pup55 wrote:
Also, there is no apparent "volume weighting", which would answer the question, is "reserves growth" dependent on field size: do "big fields" tend to be over-or under-estimated to a greater extent than small fields. 100% reserves growth in a big field will cancel out a lot of 2% growth in small fields, even though the average would be 49%.


The Arrington and R&A and Verma type calculations are inherently volume weighted. If you simply use the fractional yearly reserve change, and then average something along those lines, its exactly the problem you are describing.
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Re: Is Reserve Growth a Non-issue??

Unread postby ReserveGrowthRulz » Sun 05 Mar 2006, 10:37:16

WebHubbleTelescope wrote:
Editing staff? What do you work for, a high school paper?


Yeah...I wish. Life would be much easier if that were the case.
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Re: Is Reserve Growth a Non-issue??

Unread postby WebHubbleTelescope » Sun 05 Mar 2006, 11:24:05

ReserveGrowthRulz wrote:
WebHubbleTelescope wrote:
Editing staff? What do you work for, a high school paper?


Yeah...I wish. Life would be much easier if that were the case.


Where I have worked, the engineers and scientists are totally responsible for whatever they write. If any editors get involved, if at all, they may check for grammar or to make sure the company is sufficiently name-checked. The big research companies like IBM or the universities leave you alone and let you sink or swim depending on your content. I have never heard of an edit cycle, perhaps a review cycle in a team setting -- but editing in basic scientific research is considered a serious faux pas, and would drive the best scientists away rather quickly to search for greener pastures.
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Re: Is Reserve Growth a Non-issue??

Unread postby ReserveGrowthRulz » Sun 05 Mar 2006, 16:12:26

WebHubbleTelescope wrote:
ReserveGrowthRulz wrote:
WebHubbleTelescope wrote:
Editing staff? What do you work for, a high school paper?


Yeah...I wish. Life would be much easier if that were the case.


Where I have worked, the engineers and scientists are totally responsible for whatever they write. If any editors get involved, if at all, they may check for grammar or to make sure the company is sufficiently name-checked. The big research companies like IBM or the universities leave you alone and let you sink or swim depending on your content. I have never heard of an edit cycle, perhaps a review cycle in a team setting -- but editing in basic scientific research is considered a serious faux pas, and would drive the best scientists away rather quickly to search for greener pastures.


From that point of view, perhaps I should have said "review" rather than edit. There is peer and technical review, names and standards, approvals on various levels for content and contribution value, blah blah blah.

I enjoy doing the work rather than writing about it, myself. The "editing" or "review" process strikes me as the biggest pain in the butt, even if I do understand the need for it.
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Re: Is Reserve Growth a Non-issue??

Unread postby JohnDenver » Tue 07 Mar 2006, 10:07:25

The procedure used by the USGS in its World Petroleum Assessment 2000 has an excellent record of predicting reserve growth:
This study compares the additions to conventional crude oil and natural gas reserves as reported from January 1996 to December 2003 with the estimated undiscovered and reserve-growth volumes assessed in the U.S. Geological Survey World Petroleum Assessment 2000, which used data current through 1995. Approximately 28% of the estimated additions to oil reserves by reserve growth and approximately 11% of the estimated undiscovered oil volumes were realized in the 8 yr since the assessment (27% of the time frame for the assessment). Slightly more than half of the estimated additions to gas reserves by reserve growth and approximately 10% of the estimated undiscovered gas volumes were realized.

LINK
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Re: Is Reserve Growth a Non-issue??

Unread postby nero » Tue 07 Mar 2006, 11:34:53

JohnDenver wrote:The procedure used by the USGS in its World Petroleum Assessment 2000 has an excellent record of predicting reserve growth:


This result is quite striking especially given the uncertainty that the USGS had initially claimed was inherent in the estimate. What is not clear to me that perhaps someone may clear up for me is what reserve growth function the USGS2000 report used. Was it the 10X factor one or did they use another? They do say they used the IHS data base but they also say they extrapolated from US experience of reserve growth.

In any event it is highly dependent on the IHS database. I remember reading somewhere that the IHS database has had some large upward revisions for the middle east in the past few years. If that is the case then the reported additions for the past 8 years would have been primarily due to this. It would have been interesting if the authors had discussed the accuracy for the reserve addition predictions at a regional level. Where did the prediction method fail where did it succeed?

I hesitiate to make this speculation but the USGS predictions could also be something of a self-fulfilling profesy. The world reserve additions will be dominated by the reserve additions in the middle east where we suspect reserves are a highly politicized number. If people are aware of what the expected reserve addition is, then they may feel political pressure to ensure the numbers meet the expectations. This feed forward mechanism has been observed in financial reports. For oil reserves we are placing IHS in the position of the auditor who certifies the reserves statement of the NOCs, let's hope IHS has not gone the way of Andersen Consulting.

I don't give much credence to the foregoing conspiracy theory but it would be nice to know which countries provided the majority of the reserves growth in the 1996-2003 period.
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Re: Is Reserve Growth a Non-issue??

Unread postby JohnDenver » Wed 08 Mar 2006, 01:42:15

I haven't had time to read it, but all the details are given here:
http://energy.cr.usgs.gov/WEcont/chaps/RG.pdf
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Aging Oil Fields Defy Gravity to Pump More Crude

Unread postby AdamB » Fri 09 Mar 2018, 16:19:42


Bob Dudley, in his 38 years in the oil industry, has never seen anything like what happened with BP Plc’s old fields last year: They gushed more crude. “I cannot remember ever in my career having seen a negative decline rate,” the British oil-giant’s chief executive officer said in an interview on the sidelines of the CERAWeek by IHS Markit energy conference in Houston. Bob Dudley Bloomberg The fact that Dudley isn’t alone in seeing mature fields dwindling less than expected -- and in BP’s case surprisingly increasing -- means the Organization of Petroleum Exporting Countries has one more thing to worry about. As if the shale boom wasn’t enough of a headache. Better results from legacy fields, also observed by producers like Royal Dutch Shell Plc and countries like Norway, further complicate efforts by petro-states like Saudi Arabia to push prices higher by curbing


Aging Oil Fields Defy Gravity to Pump More Crude
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Re: Is Reserve Growth a Non-issue??

Unread postby spike » Tue 13 Mar 2018, 11:39:41

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Re: Is Reserve Growth a Non-issue??

Unread postby ROCKMAN » Tue 13 Mar 2018, 18:15:25

I gather Dudley has never really looked at the decline rate of fields. First, the article doesn't say production increased: the rate of decline decreased. Second, over the last 4 decades the Rockman has studied, IN DETAIL, the production history of thousands (yes, thousands...not hundreds) of reservoirs. I don't recall a single case when the rate of decline of field DID NOT DECREASE as it marches towards 100% depletion.

Consider the production rates of all the oil wells in Texas. In 1973 the average rate of wells was 21.65 bopd. And 10 years later it had declined to 11.76 bopd. And then 10 more years later 8.46 bopd. And 10 more years later 6.38 bopd.

Do I have to calculate the decreasing rate of decline? It should be obvious to a 10 yo. And yes: thatnks to the shale play the rate increased. But that's not an increase in the decline rate of heritage production.
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