Modeling the Upgrading Sequence of Conventional Hydrocarbon Reserves

Since the uncertainty of conventional hydrocarbon resources in different stages is disparate owing to the limitation of geological data, how to determine the sequence that the resources in lower levels upgrade into the proven reserves is critical for assessing the hydrocarbon exploration performances. This paper develops a creative model describing the impacts of reservoir type, technical progress and political and economic factors on reserve upgrading. This analysis quantifies the uncertainty in the finding process by adopting the SPEE rates and the adjustment rates reflecting the upgrading differences in reservoir type and technical progress. We illustrate the AD block in China as an application. This method is important for decision-makers to evaluate annual exploration efficiency and optimize exploration strategy. It is also helpful for governments to regulate the replacement of reserves and production and implement the strategy of sustainable development.