Unconventional reserves and resources in the Petroleum Resource Management System (PRMS): a square peg in a round hole?

Abstract

Estimation and reporting of unconventional hydrocarbon reserves and resources have been a subject of intense focus in recent years. As unconventional hydrocarbons become increasingly important, it is essential that practices keep pace with a rapidly changing industry. The PRMS was primarily developed for conventional hydrocarbons although it is applicable to all accumulations, including unconventional. Force-fitting the PRMS for use in unconventional reservoirs is problematic. Many key areas would benefit from better definition and guidance. These areas include: assessment and reporting of prospective resources, definition of a prospect, risk assessment, definition of a discovery, extent of discovery, and linkage of reserves to the definition of project. Unconventional gas developments for LNG export present particular challenges. One primary purpose of reserves and resources definitions is to provide consistency of terminology and reporting for all parties involved including operators, investors, governments, and regulatory bodies. Within the industry, there is widespread acceptance that unconventional hydrocarbons are different, not only in how they are developed but also in how reserves and resources are evaluated and reported. Present practices may not fit neatly into the PRMS requirements, so compromises must be made. In particular, the PRMS axes of risk and uncertainty become blurred with present unconventional practices. This extended abstract highlights the many issues that make estimation and reporting of unconventional resources problematic within the PRMS and it suggests possible solutions to enable a more appropriate set of definitions and guidelines to be prepared.