Decision No. 38/2005/QD-BCN on the classification of petroleum resources

• Số hiệu: 38/2005/QD-BCN
• Loại văn bản: Quyết định
• Nơi ban hành: Bộ Công nghiệp
• Người ký: Hoàng Trung Hải
• Ngày ban hành: 06/12/2005

THE MINISTRY OF INDUSTRY -------	THE SOCIALIST REPUBLIC OF VIETNAM Independence– Freedom – Happiness ---------------
No. 38/2005/QĐ-BCN	Hanoi, December 06, 2005

DECISION

ON THE CLASSIFICATION OF PETROLEUM RESOURCES AND RESERVES, AND PETROLEUM RESERVES REPORTING

THE MINISTER OF INDUSTRY

Pursuant to the Law on Petroleum dated July 06, 1993, and the Law on amending and supplementing a number of articles of the Law on Petroleum dated June 09, 2000;

Pursuant to the Government's Decree No. 48/2000/NĐ-CP dated September 12, 2000, detailing the implementation of  the Law on Petroleum

Pursuant to the Government's Decree No. 55/2003/NĐ-CP dated May 28, 2003, defining the functions, tasks, powers and organizational structure of the Ministry of Industry;

At the proposal of the Director of the Department of Energy and Petroleum,

DECIDES:

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Article 2. This Decision takes effect after 15 days as from its publication on the Official Gazette. The previous provisions in contravention of this Decision are all abolished.

Article 3. The Chief of the Ministry Office, The Ministerial Chief Inspector, Directors of Departments affiliated to Ministries, Directors of Departments of Industry of central-affiliated cities and provinces, the General Director of Petrovietnam, and Heads of relevant units are responsible for implementing this Decision./.

THE MINISTER




Hoang Trung Hai

REGULATION

ON THE CLASSIFICATION OF PETROLEUM RESOURCES AND RESERVES, AND PETROLEUM RESERVES REPORTING

(Promulgated together with the Decision No. 38/2005/QĐ-BCN dated December 06, 2005 of the Minister of Industry)

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GENERAL PROVISIONS

Article 1. Purposes

This Regulation unifies the classification of petroleum resources and reserves, and petroleum reserves reporting.

Article 2. Subjects and scope of application

This Regulation is applicable to all the organizations and individuals permitted by the Government of Vietnam to explore and extract petroleum on land, islands, territorial sea, exclusive economic zones, and the continental shelves of the Socialist Republic of Vietnam.

Article 3. Interpretation of terms

The terms in this Regulation are construed as follows:

1. “Current economic conditions” are the economic criteria, including the norms, unit prices, sale prices, and other criteria applicable at the time of estimating the reserves.

2. “Reasonable certainty” is the certainty value corresponding to the probabilities ≥ 0.85 on the cumulative probability distribution curve according to probability and statistics theory.

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4. “Medium certainty” is the certainty value corresponding to the probabilities = ± 0.5 on the cumulative probability distribution curve according to probability and statistics theory.

5. “”Incremental production” is the amount of petroleum extracted from the beginning to a certain time.

6. “Group of prospects – Play” is a group of petroleum prospects in the same set of geographical and geological circumstances, and the same conditions and characteristics of the source, reservoir, and seal .

7. “Flow testing” is the test of the petroleum well in order to collect the data about the producing formation such as the flow rate of oil, gas, water, pressure, temperatures, and other data.

8. “Well testing” is the technique to determine the productivity and other data of the producing formation.

Chapter 2:

CLASSIFICATION OF PETROLEUM RESOURCES AND RESERVES

Article 4. Petroleum resources

Petroleum resources are the total petroleum-in-place, estimated on a given date, including the amount of petroleum extracted from the discovered petroleum accumulations, and the amount of petroleum estimated to exist in the accumulations that will be discovered.

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- Discovered resources.

- Undiscovered resources.

Article 5. Discovered resources.

Discovered resources are the total petroleum-in-place, estimated on a given date, in the petroleum accumulations discovered through oil drilling. The discovered resources, including the total recoverable petroleum and potentially recoverable resources.

1. The recoverable petroleum is the amount that has been and will be economically recoverable from the accumulations discovered by reasonable technologies, suitable for current economic and legal conditions.

Total recoverable petroleum includes the total petroleum amount extracted and the residual petroleum reserves at that time.

The residual petroleum reserves include the proven reserves (P1) and unproven reserves (P2 and P3) specified in Clause 1 Article 5 of this Article.

2. Potentially recoverable resources are the discovered and recoverable petroleum, but are not able to be economically extracted at the time of estimating due to technical, technological, economic, environmental reasons, and other criteria. Potentially recoverable resources are classified as proven (P4) and unproven (P5 and P6). The determination of Potentially recoverable resources classifications depends on the conditions similar to that of the recoverable reserves.

Article 6. Undiscovered resources.

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Undiscovered resources include estimated undiscovered recoverable resources (R1) and undiscovered technically recoverable resources (R2).

1. Estimated undiscovered recoverable resources (R1) are petroleum resources estimated to be recoverable, on a given date, from the prospects marked on maps without knowing the existence of petroleum through drilling, or the reservoirs under the producing strata of the fields being extracted, in geological conditions considered favorable for petroleum accumulation, but is not yet reached.

2. Undiscovered technically recoverable resources (R2) are the recoverable petroleum resources estimated on a given date, regarding  the petroleum accumulations estimated to exist technically in a Play, in favorable geological conditions for petroleum accumulation, but are not marked on maps.

Article 7. Petroleum reserves

Petroleum reserves are the estimated amount of petroleum that remains in the natural petroleum accumulations on a given date, discovered with various certainties, depending on the geological survey results.

Depending on the declining certainty, petroleum reserves are classified as proven reserves and unproven reserves.

1. Proven reserves (P1)

Proven reserves are the economically recoverable petroleum, estimated on a given date with reasonable certainty, of the discovered petroleum accumulations that are planned to be extracted in the current technical, technological, economic, and social conditions.

The reserves are classified as proven when the following conditions are satisfied:

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- The permeability, capacity, and saturation of petroleum of the petroleum reservoir are certified by the core and well logging data.

- The well test results of the economic flow from at least 1 oil well.

2. Unproven reserves.

Unproven reserves include probable reserves and possible reserves.

a. Probable reserves (P2)

Probable reserves are the economically recoverable petroleum, estimated on a given date, with medium certainty, that is not certified by the well testing results.

The probable reserves of each oil reservoir is determined by extrapolation methods suitable for the geological conditions of the oil reservoir (Annex II).

b. Possible reserves (P3)

Probable reserves are the economically recoverable petroleum, estimated on a given date, with low certainty, that is not certified by the drilling data.

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The diagram of petroleum resources and reserves classification is provided in Annex I of this Regulation.

Chapter 3:

PETROLEUM RESERVES REPORTING

Article 8. Petroleum reserves report contents

1. The petroleum reserves reports are made by the operator or the competent advisory agency, and approved by the contractor.

2. Petroleum reserves report contents.

A petroleum reserves report includes the full and summary report.

The full report comprises 02 parts:

- Part I - Description

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The details of the Reserve report and the enclosed Annexes are provided for in Annex III of this Regulation.

Article 9. Petroleum reserves boundary estimate

1. The petroleum reserves estimate report must cite the principles used to determine the boundary of the petroleum reservoir for estimating the reserves.

If similar methods are applied, it is required to provide the original figures and explain the use of such figures for the field or reservoir being estimated to certify the reliability of the method and the figures.

2. The petroleum reserves are classified as prescribed in Chapter II of this Regulation.

Article 10. Petroleum reserves estimate methods

1. The reserves of petroleum and condensates may be estimated using the volumetric method, materials balance method, and other methods suitable for the geological structure and existing data. The application of the volumetric method is compulsory. Other methods may be applied depending on the particular conditions, enclosed with the explanation for the selection. The petroleum reserves must be estimated on the basis of Monte Carlo simulation. The values of reserves must be classified as Low estimate, High estimate, or Best estimate.

2. When re-estimating the reserves of a petroleum field, it is required to compare the figures of the new calculations with the previous ones, and find the reasons of such differences.

3. The reserves of oil, gas, condensates, and their combination in each reservoir and the whole field must be separately estimated, together with finding the possibility of practical extraction.

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Chapter 4:

PROCEDURES FOR SUBMITTING PETROLEUM RESERVES REPORTS

Article 11. Procedures for report submission

Before applying for the approval for the petroleum reserves report, the authorized operator or contractor must reach an agreement with Petrovietnam on the contents, and submit the report to the Ministry of Industry via the contractor, operator, or Petrovietnam for approval.

Article 12. The report dossier

The dossier of petroleum reserves report or petroleum reserves re-estimate report, enclosed with the request for approval of Petrovietnam, that is sent to the Ministry of Industry, includes:

a. The full report (in Vietnamese or English);

b. The summary report (in Vietnamese and English);

c. The CDs containing the digitized contents and figures of the report;

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Article 13. Appraisal and approval

According to the statement of the authorized operator or contractor, and the agreement of Petrovietnam, the Petroleum Reserves Appraisal Council, presided by the Ministry of Industry, shall appraise the petroleum reserves report. After the petroleum reserves report is passed, the Ministry of Industry shall submit it to the Prime Minister for approval.

Chapter 5:

PETROLEUM RESERVES REGISTRATION

Article 14. Petroleum reserves registration

After receiving the approval from the Prime Minister for the petroleum reserves estimate, the authorized operator or contractor must register the approved reserves with Petrovietnam for monitoring, summarizing, and reporting as prescribed by current law provisions.

Article 15. Registering and re-estimating petroleum reserves

If the petroleum reserves approved by the Prime Minister change during the estimate, development, and extraction, the authorized operator or contractor must register with Petrovietnam. If the petroleum reserves differ more than 15% compared to the nearest approval, the authorized operator or contractor must make the report on the reserves re-estimate and submit for approval as prescribed in Chapter IV of this Regulation. The re-estimate shall be recorded under the form in Annex V of this Regulation.

Chapter 6:

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Article 16. Organizations and individuals participating in the petroleum activities and Petrovietnam are recommended to send feedbacks on the difficulties arising during the course of implementation to the Ministry of Industry for consideration and settlement

ANNEX

Promulgated together with the Decision No. 38/2005/QĐ-BCN)

Annex I:

CLASSIFICATION OF PETROLEUM RESOURCES AND RESERVES

 

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DETERMINATION OF THE RANGE OF RESERVES (P2 AND P3) BY EXTRAPOLATION

1. Probable reserves - P2

Probable reserves of each petroleum accumulation is determined using the distance bisection method (picture 1) as follows:

I.1. For oil:

a. From the Highest point of oil (HPO) to the midpoint of the range between the Highest point of oil (HPO) and the Lowest point of gas (LPG), or the Structural top (ST) if the Lowest point of gas (LPG) is not identifiable.

b. From Lowest point of oil (LPO) to the midpoint of the range between the Lowest point of oil (LPO) and the Highest point of water (HPW), or the Structural spill point (SSP) if the Highest point of water (HPW) is not identifiable.

I.2. For gas:

a. From the Lowest point of gas (LPG) to the midpoint of the range between the Lowest point of gas (LPG) and the Highest point of oil (HPO), or:

b. From Lowest point of gas (LPG) to the midpoint of the range between the Lowest point of gas (LPG) and the Highest point of water (HPW), or the Structural spill point (SSP) if the Highest point of water (HPW) is not identifiable.

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I.4. The following cases are also classified as Probable reserves (P2):

a. The reserves of the formations may be increased and classified as Proven when carrying out intensive drilling, but at the time of estimating the reserves, the intensive drilling is not available.

b. The reserves of the formation may be increased and classified as Proven if carrying out extensive drilling, but at the time of estimating the reserves, the extensive drilling is not available, and the structural map of the formation is not sufficient for classifying it as Proven.

c. The reserves in the strata show potential to producing the petroleum flow according to the well logging data, but the core samples or well testing data are not sufficient, and they do not have similar characteristics compared to that of the formation being extracted or the Proven formation in the same area.

d. The reserves belonging to the area of the proven stratum produce the petroleum low in other area of the field, but such area appears to be separated by faults or geological seals, and the structural position is higher than the area classified as proven, according to the geology interpretation and analysis data.

e. The reserves from the application of enhanced oil recovery method are completed and commercialized when the pilot program or project has been established and installed but have not commenced, and the characteristics of reservoir rocks, formation fluid and formation factor are appropriate for commercially apply such methods.

f. The reserves from the repair, processing, reprocessing, or replacement of well parts, or other technical processing, but such processes have not been recognized as successful when being applied to the wells with the same conditions and in the similar formations.

g. The increased reserves from the re-analysis and re-interpretation of the formation dynamic, or the data about volume parameters show that there are considerable reserves apart from the reserves specified as proven.

II. Possible reserves - P3

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II.1. For both oil and gas:

a. From the middle point of the range between the Lowest point of oil or gas (LQO, LPG) and the Highest point of water (HPW), or the Structural spill point (SSP) if the Highest point of water is not identifiable, to the Highest point of water (HPW) or the Structural spill point (SSP) if the Highest point of water is not identifiable.

b. From the middle point of the range between the Highest point of oil (HPO) and the Structural top (ST), to the Structural top (ST).

II.2. The distance bisection method may be replaced by other geological, geophysical data and technologies of which the foundation and theory are clear.

II.3. The following cases are also classified as possible reserves:

a. The reserves extrapolated from the structure or strata, according to the analysis and interpretation of geological and/or physical data, apart from the areas classified as possible.

b. The reserves in the strata showing the appearance of petroleum according to well logging and core sample data, but may produce non-commercial petroleum flow

c. The reserves estimated by enhanced oil recovery according to pilot projects or new projects that have not commenced, and the characteristics of reservoir rocks, formation fluid and formation factor still cause objective doubt about the commerciality of the project.

d. The reserves belonging to the area of the proven stratum are able to produce petroleum flow in other areas of the field, but such area appears to be separated by faults or  geological seals, and the structural position is lower than the area classified as proven, according to the geology interpretation and analysis.

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f. The formation has high volume of petroleum but the risk is high:

f.1. The coverage of seismic data of the area is small.

f.2. The quality and continuity of the formation are not clear.

f.3. Additional recovery from the application of recovery enhancement methods.

f.4. The average parameters of the formation are better.

Diagram 1. Classification of petroleum reserves according to the distance bisection method

Proven (P1/P4), Possible (P2/P5), Probable (P3/P6)

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Annex III:

PETROLEUM RESERVES REPORT

FIELD: ………………….

PART I

1. Introduction

2. The history of exploration and discovery

3. Materials, results of analysis, researches, samples, and well testing.

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3.2. Results of the well testing, flow testing, and pilot project (if any) of oil/gas/water.

3.3. Other surveys and studies (biostratagraphy, sedimentary lithology, geochemistry…)

4. Exploration geophysics

4.1. Seismogram:

- Seismic-line network.

- Data of Seismic field acquisition and processing.

- Assessment of data.

- Interpretation of data, conversion of time – depth, special researches – AVO, CTC…

- The vague technical contents that need supplements.

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4.3. Other exploration geophysical surveys (gravity, magnetic field…)

5. Geology

5.1. Local geology

5.2. Geological structural

- Strata.

- Tectonics: the system of faults and folds, and the explanation of the tectonics of the formation of petroleum traps.

- Appearance of petroleum and the producing formation.

5.3. Petroleum reservoirs:

- The connections and name of the producing formations.

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+ The structural top and base reservoir map.

+ The depth map, usable capacity coefficient

+ Geological section of the petroleum reservoir.

- The contact surface of oil, gas, water.

6. Well logging:

6.1. Method, volume, and quality of measurement data.

6.2. Method and results of formation factor interpretation.

6.3. Study and analysis of formation factor according to core samples in connection with well logging.

6.4. The vague issues that need supplements.

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7.1. Documents and quality.

7.2. Oil/gas characteristics (PVT, API, GOR, CGR, P_b…).

7.3. Reservoir permeability

7.4. Formation temperature and pressure.

7.5. Formation water, properties and dynamics

7.6. Well testing (RFT, MDT, DST…), economic flow testing data…

7.7. The situation of oil – gas – water extraction and pumping.

7.8. Calculation method and description of reserves data.

7.9. Applied reserves estimate method and formula.

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7.11. Conclusion about the lower limits (critical limits) of the parameters

- The volume of reservoir rock

- The usable storing thickness.

- The porosity

- The water saturation.

- The density of oil/gas, the volume conversion parameters…

- The flow dynamics, and the pressure/energy/productivity of the formation…

- The reserves petroleum-initially-in-pace of the reservoir and the field.

7.12. Evidence for the petroleum recovery factor of the field.

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7.14. The problems and suggested solutions.

7.15. The reserve calculation results using similar methods or materials balance method, in comparison with the results given by volumetric method.

8. Conclusion and suggestion:

- The basic conclusion about the geological structure, the estimate of the reserves of oil, gas, condensed gas, the hydrographical and geological conditions, the applicable extraction technology, and its general potential.

- The suggestion about the future geological surveys, and the necessary scientific research.

- The official opinions of the authorized operator or contractor, and Petrovietnam about the submission to the Ministry of Industry for appraisal and to the Prime Minister for approval of the reserve report.

PART II – TABLES AND DIAGRAMS

The Annex must contain all the necessary data and materials related to the exploration and reserves estimate, together with the tables and diagrams necessary for illustrating the report.

A - TABLES

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+ The volume of exploration boring.

+ The data about the volume of core samples and method of analysis.

+ Well testing data.

+ The well logging data.

+ Chemical composition and physical properties of formation water.

+ The physical, lithological and sedimentary data about the producing strata.

+ Chemical and physical properties of oil.

+ Dissolved gas content in oil.

+ Properties of free gas.

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+ Average value of porosity, permeability and saturation of petroleum.

+ The value and reserve of oil and dissolved gas of the oil field.

+ The value and reserve of oil and dissolved gas, and other constituents of the gas field.

+ Comparing the accepted values when recalculating the reserve of oil, gas, dissolved gas, condensed gas, with the approved data.

+ Comparing the reserves of oil, gas, dissolved gas, and condensed gas with the approved reserve.

+ The data about the extraction of the producing formations (if any).

B-DIAGRAMS

1. The overall map of the field area and field location

2. The seismic-line network map

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4. The TWT map and the representative cross sections.

5. The depth map of the boundaries of main strata.

6. The thickness of the structural strata of the stratigraphic unit that contain petroleum.

7. The geological sections through the wells.

8. The geological sections of the petroleum reservoirs of the field through the wells.

9. The diagram and table of connection data of the producing formation through the wells.

10. The structural top and base map of the producing formation.

11. The topographical map of the petroleum reserves (the map scale is 1:25,000, and the cross section of the field must use the highest scale according to the 2D or 3D seismic survey).

12. The interpretation table of well logging and well testing data of producing formations of each well – vertical scale = 1/200.

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14. The table of description and analysis of core samples and sediment samples.

15. The data and results of well testing and flow testing and extraction (if any): the productivity of oil/gas/water, the temperature, pressure, the well monitoring and examination…

16. The wellbore deviation data.

17. The list of documents used to make the report, the relevant documents and reports (on demand).

18. The papers and software used for the calculation.

Annex IV:

PETROLEUM RESERVES REGISTRATION SHEET

No.

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Name of company and estimates

Name of previous reports

Approval symbol

Petroleum-initially-in-place

Approved reserves (m^3)

1

2

3

4

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6

7

P1 – P2 – P3

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Gas (hydrocarbon):

Condensate:

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Revised petroleum-in-place

Registered reserves (m^3)

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Reason

Current petroleum-in-place

Approved reserves (m^3)

Change +/-m3/%

Effective date

Approval symbol

Notes

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11

12

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15

16

17

P1-P2-P3

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Gas (hydrocarbon):

Condensate:

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P1-P2-P3

Oil:

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Condensate:

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PETROLEUM RESERVES STATISTICS

No.

Well

Company

Report name

Registration

Petroleum-in-place

First approved reserves (m^3)

Symbol

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P1

P2

P3

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1

2

3

4

5

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7

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11

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Oil:

Gas:

Condensate:

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(continue)

Reserve change

Reason  

Extracted petroleum amount

First approved reserves (m^3)

Notes

…m^3

%

P1

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P3

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P1

P2

P3

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12

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14

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16

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23

Oil:

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Condensate:

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Oil:

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Condensate:

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