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US oil reserves surpass those of Saudi Arabia and Russia

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  • #16
    Originally posted by G David Bock View Post
    Am I reading/understanding this right?
    400 billion looks like more than 264bn(billion).
    The Rystad Energy report is adding its estimate of undiscovered resources to its reserve estimate.

    Somehow, they came up with 264 billion barrels of proved, probable, possible and potential reserves (resource potential).

    1P = Proved Reserves (>90% probability = actual valuation)
    2P = Proved + Probable (>50% probability)
    2PC (3P) = Proved + Probable + Possible (>10% probability)
    2PCX = Proved + Probable + Possible + Undiscovered (not reserves)



    Probable reserves (2P) can be used for certain accounting measures; however they are not proved reserves. Possible reserves (3P) cannot be used for any accounting measures. Undiscovered resources aren't reserves.

    Most estimates of undiscovered resource potential in the United States (onshore + offshore) are in the range of 400 billion barrels. If you count oil shales (different from shale oil) you can push the number up to 1.4 trillion barrels.

    This study commits the same error, just in the opposite direction, as Maobama did when he babbled about the US having only 2% of the world's proved reserves. Our proved reserves are subject to very strict accounting rules. Saudi Arabia, Iran, Russia, Venezuela, etc. are not bound by the same rules, unless they have publicly traded entities in the US. So. it is meaningless to try to gauge our remaining resource potential by comparing our reserves to other nations.

    Reserves are not potential. Reserves are what has been found and can be produced under certain economic and technical scenarios.

    The US has huge potential for future oil and gas discoveries, probably far greater than Saudi Arabia or Russia. However, those future discoveries aren't reserves.
    Watts Up With That? | The world's most viewed site on global warming and climate change.

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    • #17
      Looks like we'll need to get your word out to MSN.com;
      The U.S. now has the largest oil reserves in the world
      http://www.msn.com/en-us/money/marke...bJl?li=BBnb4R7

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      • #18
        Originally posted by G David Bock View Post
        Looks like we'll need to get your word out to MSN.com;
        The U.S. now has the largest oil reserves in the world
        http://www.msn.com/en-us/money/marke...bJl?li=BBnb4R7
        I can't fix the media's ignorance.

        If a publicly traded company used Rystad's methods to report reserves, they would go to prison. Rystad is pushing a consulting service, not auditing reserves.
        Reserves

        According to the Society of Petroleum Engineers, reserves are "those quantities of petroleum claimed to be commercially recoverable by application of development projects to known accumulations under defined conditions." Well, that clears things up, right? No? Well, to clarify, the SPE says petroleum quantities must fit four criteria to be classified as reserves. They must be (1) discovered through one or more exploratory wells, (2) recoverable using existing technology, (3) commercially viable, and finally (4) remaining in the ground. Sound okay? Good, because it gets more tricky from there. There are currently three classifications for reserves: proved, probably and possible. Here's how they break down:
        Proved reserves
        are those with a "reasonable certainty" (a minimum 90% confidence) of being recoverable under existing economic and political conditions. We can discussed the differences between proved developed, proved undeveloped, etc. with a later post. However, it should be pointed out that proved reserves are the only reserves recognized by the U.S. SEC. This is why energy companies strive to get the latest technology and recovery methods recognized by the government, therefore increasing the chance of "reasonably" recovering oil and gas assets and therefore raising their reserves as well.

        Probable reserves
        are petroleum and gas quantities with a 50% confidence level of recovery. Basically, you may be able to get some, you may not.

        Possible reserves
        are quantities with a minimum 10% certainty of being produced. Basically, your long shot discoveries. Only gamble on these types of assets if your Magic 8-Ball tells you to. All right! That takes care of reserves! But what about resources?

        Resources

        For those of you who have looked at on the market ads, you'll spot this term a lot in the literature. So what is resources? Again, we turn to the SPE. There are two categories of resources: contingent and prospective. are quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations, but the projects are not yet considered mature enough for commercial development due to one or more contingencies. In other words, there's a good idea of how much oil and gas is in the reservoir, but issues such as political and social events or even a lack of market prevent production. There can be a major oil discovery in the Congo right now. You want to risk getting shot to get to it? are quantities of petroleum estimated to be potentially recoverable from undiscovered accumulations by application of future development projects. These sorts of resources basically exist in the minds of marketing people. That's not to say that they don't exist in the real world as well, it just means that E&Ps are thinking of future oil and gas discoveries in new areas, based on upcoming technology and the discoveries made in similar formations worldwide. Okay! I hope that helps! Until next time, may the resource be with you. Live long and prospect.

        http://www.oilandgasinvestor.com/ste...s-vs-resources

        Rystad is lumping reserves (proved, probable and possible), resources (contingent and prospective) and resource potential into its own definition of reserves.
        Last edited by The Doctor; 05 Jul 16, 17:58.
        Watts Up With That? | The world's most viewed site on global warming and climate change.

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        • #19
          Pure Bull Swat...
          Quis Custodiet Ipsos Custodes? Who is watching the watchers?

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          • #20
            What does it matter? The EnviroMental-cases won't allow it to be pumped, and if they fail to block it they will prevent oil pipelines from being built AND prevent oil from being shipped by rail.
            Just as they are doing in Oregon.

            It just isn't saaaaafe, don't you know?
            "Why is the Rum gone?"

            -Captain Jack

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