Getting from Geological Chance-Factors to Chance of Economic Success: What Are We Risking?

Peter R. Rose

In assessing prospect chance, the key issue is not the probability of finding at least a minimal accumulation of reservoired hydrocarbons (P_S), but rather the probability of finding an economic accumulation (P_SE), whatever the exploratory theater and profitability cut-off. Any risking procedure must acknowledge Industry's documented poor performance in predicting reserves--given a discovery, we cannot reliably forecast whether it will be a large field or a small one!

So, in most provinces, any risking method requiring the geologist to assess "adequacy" of geological chance-factors (keyed to a prospective field of specified "significant" size, or larger), asks for levels of discrimination that are demonstrably beyond our resolution. Also, given the wide variance among components controlling prospect reserves (Area, Net Pay, HC-Recovery), and multiplicative compensation by offsetting higher and lower values of a single component to screen out part of a fairway.

The recommended method avoids these problems. It first generates a probabilistic reserve distribution for the prospect in which the P_1% reserves value represents a very small accumulation of moveable ("flowable") hydrocarbons. Next, the prospector estimates confidence (as percent) in the occurrence of independent geological chance-factors (P_reservoir, P_closure, P_HC-charge, P_seal), which are keyed by definition to the probability of finding a small (^approxP_1%) accumulation, or larger. So chance (P_S) and reserves coincide at P_1%.. Calculation of minimum economic field size, and plotting MEFS on the reserves distribution, a low determination of the percent of the reserves distribution that is economic (1-P_MEFS). So P_SE = P_S × (1-P_MEFS). The final step is to calculate the mean of the economic reserves distribution, i.e., that part remaining above P_MEFS.

AAPG Search and Discovery Article #91020©1995 AAPG Annual Convention, Houston, Texas, May 5-8, 1995