Contents

Reserve Calculations .......................................................................................................

1- Introduction .......................................................................................................... 2
2- Classification of petroleum reserves ........................................................................ 2
2.1- Proved Reserves (1P) – High Certainty (≥90%):- ................................................... 2
2.2- Probable Reserves (2P) – Moderate Certainty (50%):- ........................................... 3
2.3- Possible Reserves (3P) – Low Certainty (10%):- ................................................... 3
3- Calculation methods............................................................................................... 3
3.1- Volumetric estimates:- ......................................................................................... 4
3.2- Material balance estimation for oil:- ..................................................................... 5
3.3- Reservoir simulation:- ......................................................................................... 6
3.4- Production history:- ............................................................................................ 6
4- Factors affecting oil reserve calculations .................................................................. 7
4.1- Geological factors:- ............................................................................................ 7
4.2- Technical factors:- ............................................................................................... 7
4.3- Economic factors:- .............................................................................................. 7
4.4- Environmental and climatic factors:- .................................................................... 7
5- Conclusion ............................................................................................................ 8
6- Reference .............................................................................................................. 9

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1- Introduction
Estimating oil reserves is one of the most important phases of the work of a
petroleum engineer since the solutions to the problems he deals with usually depend
on a com parison of the estimated cost in terms of dollars, with the anticipated result
in terms of barrels of oil. His recommendations to management re grading the best
course of action are therefore normally based on the most favorable balance between
these two. Specific engineering problems which require such a knowledge of
recoverable oil reserves and a pro ejection of future rates are:
A. The exploitation and development of an oil reservoir.
B. The construction of gasoline plants, pipelines and refiner.
C. The price to be paid in case of a sale or purchase of an oil property, and the
magnitude of the loan which it will support.
D. The proper depreciation rate for the investment in oil properties.
E. Evaluation of the results of an exploration program.
This discussion will be confined to the various methods and tools which are currently
in use for estimating oil reserves to be obtained during the primary phase of an oil-
producing reservoir and for a projection of the future production rates. Reserves
which may be obtained by secondary recovery methods or fluid injection programs
and gas and gas conden sate reserves will not be discussed in this paper.
1- Classification of petroleum reserves
PRMS, which is widely recognized by the oil and gas industry in defining petroleum
reserves, classifies the reserves in three broad categories, namely, (i) proved, (ii)
probable, and (iii) possible
2.1- Proved Reserves (1P) – High Certainty (≥90%):-
These reserves have a 90% or greater probability of being commercially recovered
using current technology and economic conditions. They are further divided into:
● Developed Reserves:
Oil and gas currently being produced from active wells.
Also includes shut-in reserves (temporarily inactive wells) and behind-the-pipe

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reserves (discovered but not yet connected to production).
These reserves require minimal investment for extraction.
● Undeveloped Reserves:
Found in areas where future drilling and infrastructure development are required.
Extraction depends on future investments.
2.2- Probable Reserves (2P) – Moderate Certainty (50%):-
These reserves have a 50% probability of being commercially viable.
Often, these reserves require additional data or improved economic conditions to
be classified as proved reserves.
Factors that prevent them from being classified as proved include:
Lack of current extraction technology.
High operational costs.
Legal or government restrictions.
2.3- Possible Reserves (3P) – Low Certainty (10%):-
These reserves have only a 10% probability of commercial recovery.
They are considered speculative and rely on future technological advances or
economic improvements. Often located in unexplored areas or deep formations.
2- Calculation methods
To better understand reserves estimation, a few important terms require
definition. Original oil in place (OOIP) and original gas in place (OGIP) refer to the
total volume of hydrocarbon stored in a reservoir prior to
production. Reserves or recoverable reserves are the volume of hydrocarbons that
can be profitably extracted from a reservoir using existing technology. Resources are
reserves plus all other hydrocarbons that may eventually become producible; this
includes known oil and gas deposits present that cannot be technologically or
economically recovered (OOIP and OGIP) as well as other undiscovered potential
reserves.
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Estimating hydrocarbon reserves is a complex process that involves integrating
geological and engineering data. Depending on the amount and quality of data
available, one or more of the following methods may be used to estimate reserves:
• Volumetric
• Material balance
• Production history
• Reservoir simulation
3.1- Volumetric estimates:-
Volumetric estimates of OOIP and OGIP are based on a geological model that
geometrically describes the volume of hydrocarbons in the reservoir. However, due
mainly to gas evolving from the oil as pressure and temperature are decreased, oil at
the surface occupies less space than it does in the subsurface. Conversely, gas at the
surface occupies more space than it does in the subsurface because of expansion.
This necessitates correcting subsurface volumes to standard units of volume
measured at surface conditions.
One basic volumetric equation is
N = 7758Ahϕ(1 – Sw) / Boi
where
• N = OOIP (STB)
• 7758 = conversion factor from acre-ft to bbl
• A = area of reservoir (acres) from map data
• h = height or thickness of pay zone (ft) from log and/or core data
• ø = porosity (decimal) from log and/or core data
• Sw = connate water saturation (decimal) from log and/or core data
• Boi = formation volume factor for oil at initial conditions (reservoir bbl/STB)
from lab data; a quick estimate is , where N is the number of hundreds of ft3 of
gas produced per bbl of oil [for example, in a well with a GOR of 1000, Boi =
1.05 + (10 × 0.05)]

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Another basic volumetric equation is
G = 43560Ahϕ(1 – Sw) / Bgi
where
• G = OGIP(SCF)
• 43560 = conversion factor from acre-ft to ft3
• Bgi = formation volume factor for gas at initial conditions (RES ft3/SCF)
3.2- Material balance estimation for oil:-
The material balance technique mathematically models the reservoir as a tank. This
method uses limiting assumptions and attempts to equilibrate changes in reservoir
volume as a result of production. Aquifer support and gas cap expansion can be
accounted for by using this method.

where
• Bg = formation volume factor of free gas
• Bgi = formation volume factor of free gas at initial conditions
• cf = formation (rock) compressibility (psi–1)
• cw = water compressibility (psi–1)
• N = OOIP (STB)
• Np = cumulative oil produced (STB); from production history data
• P = Change in reservoir pressure due to production, that is, initial pressure
minus current pressure; taken from field pressure surveys
• Rp = cumulative gas-oil ratio, or total produced gas (in SCF)/ total produced
oil (in STB); from production history data
• Rsi = inital solution gas-oil ratio (SCF/STB)

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 • Swi = initial connate water saturation (decimal)
• We = cumulative amount of water encroachment; from map and field data
• Wp = cumulative water produced; from production history data
• Bt = total (two-phase) formation volume factor
• Bti = total formation volume factor at initial conditions
• M = gas cap size expressed as a fraction of initial reservoir oil volume; from
map data
3.3- Reservoir simulation:-
The material balance method is actually a subset of the mathematical techniques that
are available to modern petroleum engineers. Reservoir simulators use material
balance as well as fluid flow equations to model the reservoir as a group of
interconnected tanks. The advent of powerful computers has made the use of
numerical simulation quite common for estimating reserves and recovery as well as
initial volume in place. Since reservoir simulation can account for performance
history through history matching, this method incorporates facets of all the
techniques discussed. With sufficient data and prudent use of simulators, this method
provides the best recovery estimates for complex reservoirs.
3.4- Production history:-

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 Case b Rate – Time Relationship

Exponential b=0 qt = qi exp(-Di t)

Hyperbolic 0<b<1 qt = qi / (1+b Di t)1/b
Harmonic b=1 qt = qi / (1+ Di t)
4- Factors affecting oil reserve calculations
include several geological, technical, economic, and political aspects, the most
important of which are:
4.1- Geological factors:-
• The nature of rock formations and the characteristics of oil reservoirs.
• The degree of porosity and permeability of oil-bearing rocks.
• The depth and extent of oil fields.
4.2- Technical factors:-
• Exploration and drilling techniques used.
• The efficiency of primary, secondary, and tertiary extraction methods.
• The development of techniques to improve field productivity (such as water or
gas injection).
4.3- Economic factors:-
• Global oil prices and their impact on the feasibility of extraction.
• The cost of production, development, and maintenance of oil fields.
• The level of investment in research and development in the oil sector.
4.4- Environmental and climatic factors:-
• Environmental impacts of oil extraction and restrictions on production
expansion.
• Renewable energy trends and their impact on the future of oil investment.
• Climate change and its impact on exploration and production operations.

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5- Conclusion
Estimating oil reserves is a fundamental task in petroleum engineering, as it directly
influences decision-making related to field development, infrastructure investment,
and economic feasibility. The classification of petroleum reserves into proved,
probable, and possible categories provides a structured approach to assess the
certainty of recovery, guiding industry professionals in optimizing resource
management.
Various methods, including volumetric analysis, material balance equations, and
reservoir simulation, offer engineers the necessary tools to estimate recoverable
reserves accurately. However, reserve calculations are influenced by numerous
factors such as geological conditions, extraction technologies, economic trends, and
environmental considerations.
In conclusion, the accuracy of oil reserve estimation is crucial for ensuring efficient
resource utilization and long-term sustainability in the petroleum industry. By
integrating advanced technologies and continuous research, engineers can enhance
the reliability of reserve assessments, enabling informed decision-making and
strategic planning in oil and gas exploration and production.

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6- Reference
1- IHRDC, 1982, Production rate decline curves: PE107, Boston, MA, IHRDC.
2- Carr, B. S., Viret, J., 1986, PSD860030: Houston, TX, Chevron Exploration
and Production Services, March
3- Rejas Rasheed1, Prof. Avinash Kulkarni2, (2016). Reserves estimation,
International Research Journal of Engineering and Technology (IRJET)
4- Saleh Ahmed-et all, (2019). Determination of the Oil Initial in Place, Reserves,
and Production Performance of the Safsaf C Oil Reservoir, The International
Journal of Engineering and Science (IJES)