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Line 81: − [[File:Rose_time-value-of-money_1.jpg|thumb|'''Table 2.''' Calculation of means (see [[:Image:Charles-l-vavra-john-g-kaldi-robert-m-sneider capillary-pressure 2.jpg|Figure 2]])]]+ + + + + + + +
Uncertainties impacting reserves, revenue, and costs (view source)
Revision as of 16:37, 8 May 2014
, 16:37, 8 May 2014→Combining distributions
However, a graphical shortcut is readily available for combining any three lognormally distributed factors. This procedure is quick and can be performed manually. The example shown in Table 2 uses area of drainage, average net pay, and hydrocarbon recovery factor. Other variables important in development evaluations include initial flow rate (IP), decline rate, wellhead prices, and costs.
However, a graphical shortcut is readily available for combining any three lognormally distributed factors. This procedure is quick and can be performed manually. The example shown in Table 2 uses area of drainage, average net pay, and hydrocarbon recovery factor. Other variables important in development evaluations include initial flow rate (IP), decline rate, wellhead prices, and costs.
{| class = wikitable
|-
|+'''Table 2.''' Calculation of means (see [[:File:Uncertainties-impacting-reserves-revenue-and-costs_fig2.png|Figure 2]])
|-
! || Area || Net Pay || HC Recovery || Reserves || Derived ||
|-
| P<sub>10%</sub> value || 20 ac || x 7 ft || x 100 bbl/ac-ft || = 14,000 bbl = P<sub>1.3%</sub> || P<sub>10%</sub> = 28,000 || rowspan = 4 | Mz<sup>a</sup> = 91,584 bbl
|}
Note that multiplying the three ''P''<sub>90%</sub> values for area, net pay, and hydrocarbon recovery does not yield a ''P''<sub>90%</sub> value for reserves; in fact, it gives a product corresponding to 98.7%! Similarly, multiplying the three ''P''<sub>10%</sub> values gives a reserves product that corresponds to ''P''<sub>1.3%</sub>, not ''P''<sub>10%</sub>.
Note that multiplying the three ''P''<sub>90%</sub> values for area, net pay, and hydrocarbon recovery does not yield a ''P''<sub>90%</sub> value for reserves; in fact, it gives a product corresponding to 98.7%! Similarly, multiplying the three ''P''<sub>10%</sub> values gives a reserves product that corresponds to ''P''<sub>1.3%</sub>, not ''P''<sub>10%</sub>.