SPE-189019-MS

Risk and Uncertainty Assessment While Estimation of Reserves

F. V. Rahimov, SOCAR Oil Gas Scientific Research Project Institute; A. Sh. Eminov, SOCAR Azneft Production
Union; R. M. Huseynov, SOCAR Oil Gas Scientific Research Project Institute

Copyright 2017, Society of Petroleum Engineers

This paper was prepared for presentation at the SPE Annual Caspian Technical Conference and Exhibition held in Baku, Azerbaijan, 1-3 November 2017.

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Abstract
Risks are inherent practically in all sphere of oil and gas production: from geological exploration works
on oil and gas to industrial development of reserves. But it is not enough to study only risks, we often
face insufficiency of knowledge of variety of manifestations of geologic-geophysical trade properties
of the studied object. It is especially important to consider risks and uncertainty at the initial stages of
geological field works. Studying of geological risk, arising at estimation of oil reserves became a subject
of our research. The work process was divided into some stages: 1) Choice of significant geological
field parameters, 2) Definition of variable property manifestations factors of the studied geological field
parameters, 3) Multiple modeling of the studied processes, 4) Creation of Tornado plot
For further work, the analysis of an assessment of risks at reserves estimation was chosen as a probabilistic
method. It was chosen hypothetical fields which subcalculating parameters, were collected in tables
Using the data provided to the table, we make Tornado Plot extent of influence of geological risks is
visually shown in the made matrix.
The made matrix reflects degree of risks in an assessment of subcalculating parameters and their
influences on resultant indicators. The vertical scale reflects risk, which is classified on low, average, high.
Using the results received in the analysis of uncertainty and a scale of influence of parameters on resultant
indicators and a scale of level of risks, geological field parameters were located on the constructed matrix.
From the received matrix, it is visible that among the taken parameters the greatest risk and high level of
influence renders porosity. Therefore, the bigger attention at calculation of stocks and creation of geological
and mathematical model has to be paid to this parameter.

Manuscript
Risks are present practically in all spheres of oil and gas production: from exploration for oil and gas to
commercial development of resources. However, the simple analysis of risks is not sufficient, too frequently,
there is a lack of data on various geological and geophysical features of studied target. It is especially
important to take into account the risks and uncertainties at the initial stages of geological survey. This study
considers geological risks related to evaluation of oil resources [1, 7].
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The terms "geological risks", "uncertainty", "probability estimate" are applied at all phases of geological
survey and play a key role. Geological risks involve wide range of aspects. They describe probability
of presence or absence of oil and gas accumulations, the calculated amount of hydrocarbons, quality of
hydrocarbons, etc. The terms "uncertainty" and "risks" must not be confused with each other. The term
"uncertainty" indicates the shortage of our knowledge about the diversity of a studied target, including
description means for quality and evaluation of uncertainties related to inhomogeneity of lithological and
physical properties of oil deposits [8, 10].
The term "risk" envisages that emerged uncertainty bears possibly technical or financial nature. In other
words, uncertainty is primary while the risk is secondary. Risks are always the consequences of uncertainties,
while uncertainty is not necessarily followed by risk. Evaluation of geological uncertainties allows to
classify them both qualitatively and quantitatively and take them into account while developing geological-
hydrodynamic models.
For evaluation of prospective and supposed resources, the various modifications of Monte-Carlo method
are widely applied. The method makes it possible to take into account the influence of several volumetric
parameters and conduct statistical evaluation of acquired data. While the process of evaluation each
parameter is attributed by distribution type. Distribution of probabilities is the most realistic tool for
description of uncertainties of geological and oil field data while risks analysis. Prior to geological model
design or assessment of resources by Monte-Carlo technique, the evaluated uncertainties are ranked due to
the degree of their influence on reserve estimation.
While evaluation of uncertainty of the model by a method of multi-variate stochastic modeling the
iteration reconstruction of the model is done by use of various geological parameters involved in geological
model [3, 4, 11].
From many versions of geological model, the most adequate model is chosen and the results are the
following:
– Maps of efficient oil-saturated series and oil-saturated pore volume.
– Probability curve of resources distribution with evaluation of quantiles P10, P50, P90.
To establish the impact of geological and oil-field parameters on accuracy of reserves estimation
the mathematical method of sensitivity analysis is applied. Method of quantitative analysis consists in
evaluation of variation intervals of critical parameters from initial parameters. The work consists of several
stages: firstly, significant parameters of geological field are selected, secondly, the impact of studied
parameters of geological field on results are evaluated. Upon evaluation of variation range the appropriate
calculation is done. Finally, the data is presented as a Tornado plot. The plot is used for evaluation of risks
and development of risks matrix [5, 6].
For our study, we have used a special software package. Acquired data are classified, and then the most
required data are selected for input into the software package (Table 1).

Table 1—Range of volumetric data for a hypothetical field

Oil field, thous m2 Net thickness, m Porosity Oil saturation Volume factor Density g/sm3

Minimum 2570 18,0 0,18 0,70 1,030 0,886

Fundamental quantity 3060 22,0 0,19 0,71 1,114 0,886

Maximum 3320 26,0 0,20 0,74 1,179 0,886

All calculations are based on the volumetric method of reserves estimation. After data input the process
is run. Upon computation by use of software package, we have Monte-Carlo distribution (fig.1):
SPE-189019-MS 3

Figure 1—Monte-Carlo distribution

After calculation, we can get the following: Tornado plot (fig.2), sensitivity graph (fig.3).

Figure 2—Tornado plot

Figure 3—Sensitivity graph

4 SPE-189019-MS

Drawn matrix (fig.4) reflects the value of input parameters from the point of view of their contribution
into the risks related to hydrocarbon reserves evaluation.

Figure 4—Risk matrix

Risks are classified as low, average and high along the vertical axis. The graph clearly displays that
studied parameters of geological field have various risk levels due to their alteration. The most riskous
parameter for evaluation results is porosity. So, while simulation of geological-mathematical models a major
attention is given to this parameter. Thus, we have implemented the sensitivity analysis technique applied
for improved accuracy of probabilistic technique for assessment of reserves in considered hypothetic field.
The drawn Tornado plot makes it possible to visualize modeling results. As a result of our study, the risks
were assessed and their influence on oil reserves estimation was defined.

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