Traditionally, "reserves season" starts sometime 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 beginning with fiscal year end 2009, this activity will only get more complicated unless new processes are developed.
This paper will present the concept of continuous reserves management where reserves are continuously reviewed and updated during the year. This review process is executed during the year by the engineers closest to the operation rather than at year end by a committee or coordinators not involved in the day-to-day activity. With continual management of the reserves and their revisions, the reserves committee will now have greater insight well before the end of year roll up allowing for better year end and budget decisions.
This process has yielded several advantages to those practicing this methodology which will be highlighted by this paper such as:
No more October surprises: Insight on reserves numbers earlier in the process allows the corporation to provide proper guidance and make appropriate decisions throughout the year.
Higher Confidence: By year end only small revisions are needed to make a final roll up of reserves, giving a higher confidence to executives and investors that the reserves numbers are accurate.
Better Decisions: By having more accurate and timely access to reserves data during the year, decision makers will make better informed choices regarding development and portfolio decisions.
Added Value: Increased frequency in evaluations and reviews, allows engineers to recognize opportunities for improvement and identify problems sooner.
Time Management: Continuously updating and reviewing the reserves results in time savings throughout the year and removes the "all hands on deck" reserves team requirement allowing other high priority engineering projects to continue.