This article, written by Senior Technology Editor Dennis Denney, contains highlights of paper SPE 130174, ’Improving Reserves Systems Through Continuous Reserves Management,’ by Tim Loser, Energy Navigator, prepared for the 2010 SPE Hydrocarbon Economics and Evaluation Symposium, Dallas, 8-9 March. The paper has not been peer reviewed. Traditionally, “reserves season” begins in the fall and occupies many man-weeks of effort for most oil and gas companies worldwide. With the new US Security and Exchange Commission (SEC) guidelines for reporting reserves, this activity will become more complicated in the absence of new processes. The concept of continual reserves management is presented, in which reserves are reviewed continually and updated during the year. Introduction Companies track production volumes with varying intervals. However, reserves typically are handled as an end-of-year endeavor. This activity is dictated largely by governmental- and financial-reporting requirements and may reflect the business process and tools in place at these companies. As a result, the process of monitoring reserves is reactive, adding little value to the company and providing only compliance. The full-length paper details the concept of continual reserves management, in which reserves are reviewed and updated regularly throughout the year. Engineers closest to the operations can capture reserves revisions as they occur rather than defer this important task to the end of the year and perhaps delegate it to a reserves coordinator. With continual and proactive management of the reserves and their revisions, the business will have greater insight before the end-of-year roll-up, enabling better intrayear and year-end decisions. This type of system will also result in more-accurate accounting of the reserves revisions and will reduce the resources needed to complete the year-end process. Continual Reserves Management Reserves necessarily change with production and market fluctuations. Continual reserves management is a collection of business rules, strong corporate philosophy, improved technology, and business workflows. The most important component is corporate commitment to accurate and timely updates to the system. As with any system, there will be many differences between companies, but any continual-reserves-management system will need some basic building blocks. Business rules—To ensure smooth operation, these rules must include management and control provisions for regulatory compliance and the rules must define roles and timing for all updates. Regular reporting—In accordance with the business rules, regular reports to interested parties must be created. Reports to those updating reserves need to be generated automatically to indicate entities showing deviation from plan and other items that need updates. Other regular reports must be available to management throughout the year. Flexible and simple reserves-update tools. Open data structures. Vigorous training. Visible and strong corporate commitment.

This article is a synopsis of paper OTC 13119, "Delivering World-Class Uptime - Continuous Management and Learning as Applied to Standard Deepwater Subsea Systems," by F.M. Pattee, SPE, Shell Intl. E&P Inc. - Deepwater Services, originally presented at the 2001 Offshore Technology Conference, Houston, 30 April-3 May.

Summary Quality improvement processes (QIP's) and quality management systems (QMS's)are becoming part of manufacturing and service company language. In some cases, there are perceived differences between the concepts of continuous improvement and documented systems to ensure quality. I have seen examples of QIP's and QMS's working in a complementary fashion to improve existing manufacturing and administrative processes. These examples show that quality improvement activities are compatible with and can enhance the effectiveness of QMS's if the two are integrated property. Introduction Many organizations talk about quality. Some use the word in the traditional framework of quality assurance and quality control. Others consider the word to be a part of the QIP or total quality management (TQM). Still others see the situation as an "either/ or" choice. This paper discusses QMS's and the QIP and reviews their complementary and contradictory traits. What Is OMS? In this paper, QMS means the system of formal, documented practices used by an organization to measure, report. and control the quality of its goods and services. QMS's are common features of manufacturing companies, especially those involved in the manufacture of highly regulated products. Less common areQMS's that manage the quality of services. Today the ISO 9000 series of international quality standards, arguably the best-known QMS, and related standards [such as British Standard (BS) 5750] are being used far beyond the traditional realm of manufacturing companies. These standards are sets of requirements for critical elements in documented business systems that touch on topics from management review and design control to statistical techniques. The following are operational definitions of QMS. 1. QMS provides a method that allows a company to "… organize itself in such a way that the technical, administrative and human factors affecting the quality of its products and services will be under control …" 2. QMS is "… aimed primarily at preventing nonconformity …" 3. QMS acts to "… assure compliance with the requirements of the contract." QMS is ". . a network of planned and systematic actions necessary to provide confidence that a product is produced or a service is performed in accordance with specified requirements." QMS thus establishes a way to meet the stated requirements. It provides the minimum (the floor or foundation, if you will) of customer expectations. This does not imply that customer satisfaction follows when a QMS is in place. These standards are beginning to have an impact on commercial matters as well. Nowhere is this more obvious than in Europe. The European Community (EC)has adopted the ISO 9000 series as part of its efforts to establish a system for product certification and testing and quality system registration. Publicity surrounding the coming of a more well-defined EC has focused attention on this aspect of barrier-free trade within the EC. What Is QIP? QIP is a management philosophy aimed at continuously improving products and services through a formal system that recognizes suppliers and customers(internal and external), identifies processes, and provides methods of meeting customer needs. Many acronyms and phrases are used to express this same philosophy, including TQM and process improvement. Although each practitioner brings something unique to the format, this paper deals with such change programs as a whole (QIP) with no comment on the effectiveness of a particular technique or element. QIP is often described as a series of repeating cycles that give it a continuous, ongoing characteristic. QIP is a philosophy that is applicable to all areas of business, from floor-sweeping to sales to executive decisions. It focuses on envisioning the company as a linkage of processes, rather than simply giving desired outcomes or rules of administration. Are OMS and QIP Contradictory? Basically, the two concepts are not contradictory. Crawford and Puri have made point-by-point comparisons of BS 5750 and the ISO 9000 series with the Deming philosophy to answer this question. This is something of an "apples to oranges" comparison because the two concepts were not designed to answer the same sets of needs. Although the recommended methods for achieving quality improvement may contradict certain provisions of QMS in a given setting, these conflicts can be resolved. It has been my experience. however, that QMS provides a framework and a discipline that make implementation of QIP easier, not harder. For example, internal quality audits mandated by QMS initially were seen as confrontations by most department managers. Gradually, as QIP developed, managers became less adversarial in their approach to such audits and began to use them as one benchmark of their department's quality improvement. A key to this transition is the use of professionally trained auditors and an insistenceon clear, concise, objectively written reports that are reviewed personally with the manager involved. Are QMS and QIP Complementary? Yes, the two concepts are complementary! QMS and QIP can work in harmony to provide a commercial basis for product and service quality and a method for continuous improvement. QMS can be likened to traffic laws. When I drove my car to work this morning, I stayed below the speed limit, I obeyed the traffic signs, and yielded to other traffic as required. I operated within the laws(QMS). On the other hand, I also stopped to aid a driver whose car had stalled on the road. I went beyond the QMS requirements to improve the traffic flow by assisting another driver (QIP). The benefits of QIP for existing management systems become apparent when specific projects are tackled. JPT P. 863^

"‘A dialog must take place between drilling engineers and the end user because survey programs cannot be constructed in isolation without reference to cost, instrument capabilities, and operational practicalities."practicalities." Introduction Directional surveying usually is discussed in terms of distinct topics, such as specific instrument types, survey-data-reduction procedures, or instrument error analysis. procedures, or instrument error analysis. Rarely have the three themes been combined into a single framework within which the reasons for, and costs of, any particular survey program can be clearly balanced against each other. The survey program for any well can be based on three general rules: tools intended for use in a well must be qualified for the application; accuracy objectives must be specified for each well; and the proposed program must be shown to satisfy proposed program must be shown to satisfy the well's objectives. The purpose of this paper is to review some of the issues underlying the management of survey programs and to encourage the end users of well survey data to adopt a critical and d mating attitude toward, the information on which they base important reservoir engineering and petrophysical decisions. petrophysical decisions. Instrument Qualification The accuracy specification of a survey tool is an essential consideration. To manage survey operations effectively, however, it is much more important to be able to predict the behavior of an instrument reliably in any given operational situation. The precise method used to model performance is not critical, but given the pivotal Tole in the process of survey operations management, process of survey operations management, outlined in Ref. 1 and shown in Fig. 1, the performance specification for each tool must performance specification for each tool must be thoroughly validated. For a survey tool to be qualified properly for use, two essential issues have to be addressed: performance specification and quality assurance. performance specification and quality assurance. Performance Specification. The behavior Performance Specification. The behavior of the tool must be fully characterized in relation to time, temperature, latitude, inclination, azimuth, and other relevant aspects of the survey environment. The validity of tills on must be rigorously demonstrated with evidence from test runs and independent analysis. Quality Assurance. A detailed quality-assurance procedure must exist to demonstrate to the client that the instrument has performed to specification during the survey. A set of procedures with associated tolerances must provide necessary and sufficient information on which to base an acceptance or rejection decision. As yet, little consensus exists within the industry as to how these two aspects of survey instrument performance should be approached. Together they represent the single most important area for further development in directional surveying. General Instrument Capabilities A frequently asked question concerns the capabilities of modem survey tools. In general, current "high-accuracy" gyroscopic tools are capable of determining wellbore position and true vertical depth to an position and true vertical depth to an accuracy that satisfies the requirements of the majority of wells being drilled today. The performance of certain gyrocompassing performance of certain gyrocompassing devices may degrade m high-angle east/west wells at high latitudes, but these limitations can be overcome by use of attitude reference systems. Extreme temperatures create difficulties for all tools, particularly where rating of the electronic components may impose severe restrictions on the available combinations of depth and survey duration. One of the main problems with gyroscopic survey systems is that their use interrupts the drilling process. Because the full cost of a gyroscopic survey includes rig time, an economic incentive often exists to acquire the necessary information as a byproduct of the drilling process, either directly from measurement-while-drilling surveys or from drop-type multishots. The new generation of solid-state magnetic multishots is irelatively cheap to run, requires minimal incremental rig time, and dispenses with the need for third-party running gear. While the sensors themselves may be accurate to 0.05 degrees inclination and 0.15 degrees azimuth, their overall performance is limited by the effect of the following external factors. P. 1250