From the "Petroleum Resource Management System 2007" document is the following:
"Proved Reserves are those quantities of petroleum, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be commercially recoverable, from a given date forward, from known reservoirs and under defined economic conditions, operating methods, and government regulations".
"Probable Reserves are those additional Reserves which analysis of geoscience and engineering data indicate are less likely to be recovered than Proved Reserves but more certain to be recovered than Possible Reserves".
"Possible Reserves are those additional reserves which analysis of geoscience and engineering data suggest are less likely to be recoverable than Probable Reserves."
In other words, if it costs less to extract than what might reasonably be expected to sell it for, it is "Proved", and cost of extraction is irrelevant for "Probable" and "Possible".
Nothing to do with having a customer signed up.
ESG Price at posting:
78.5¢ Sentiment: None Disclosure: Held
