Putting error bars on reservoir engineering forecasts

Uncertainties about reservoir characteristics (hydrocarbons originally in place (HCOIP), faults, sand/shale continuity, aquifer size, relative permeability, etc.) and about operational factors (regularity, pump lifetimes, etc.) often combine to yield a significant composite uncertainty about production forecasts. This paper presents a methodology for converting reservoir, geological, and other uncertainties into production forecast and reserves uncertainties. The overall field development strategy and topside facilities and capacities can then be chosen to prepare as much as possible for the error bar on forecasted rates at a given point in a field's lift (which may be expensive). Error bars also can be used to judge the risk of the project and may recommend additional data gathering, long-term testing, pilots, or a phased (invest as you investigate) development. Only when the individual component uncertainties and the total uncertainty level are uncovered and their implications have been analyzed does a sufficient basis for making an informed decision exist.