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Hubbert Peak Graph showing that oil production has peaked in non-OPEC and non-FSU countries
Oil reserves are the estimated quantities of crude oil that are claimed to be recoverable under existing economic and operating conditions.

The total estimated amount of oil in an oil reservoir, including both producible and non-producible oil, is called oil in place. However, because of reservoir characteristics and limitations in petroleum extraction technologies, only a fraction of this oil can be brought to the surface, and it is only this producible fraction that is considered to be reserves. The ratio of producible oil reserves to total oil in place for a given field is often referred to as the recovery factor. Recovery factors vary greatly among oil fields. The recovery factor of any particular field may change over time based on operating history and in response to changes in technology and economics. The recovery factor may also rise over time if additional investment is made in enhanced oil recovery techniques such as gas injection, water-flooding, or microbial enhanced oil recovery.

Because the geology of the subsurface cannot be examined directly, indirect techniques must be used to estimate the size and recoverability of the resource. While new technologies have increased the accuracy of these techniques, significant uncertainties still remain. In general, most early estimates of the reserves of an oil field are conservative and tend to grow with time. This phenomenon is called reserves growth.

Many oil producing nations do not reveal their reservoir engineering field data, and instead provide unaudited claims for their oil reserves. The numbers disclosed by some national governments are suspected of being manipulated for political reasons.


Schematic graph illustrating petroleum volumes and probabilities.
Curves represent categories of oil in assessment.
There is a 95% chance (i.e., probability, F95) of at least volume V1 of economically recoverable oil, and there is a 5% chance (F05) of at least volume V2 of economically recoverable oil.

Reserves are those quantities of petroleum claimed to be commercially recoverable by application of development projects to known accumulations under defined conditions.Reserves must satisfy four criteria: They must be:
  • discovered through one or more exploratory wells
  • recoverable using existing technology
  • commercially viable
  • remaining in the ground
All reserve estimates involve uncertainty, depending on the amount of reliable geologic and engineering data available and the interpretation of those data. The relative degree of uncertainty can be expressed by dividing reserves into two principal classifications – proved and unproved. Unproved reserves can further be divided into two subcategories – probable and possible to indicate the relative degree of uncertainty about their existence. The most commonly accepted definitions of these are based on those approved by the Society of Petroleum Engineers (SPE) and the World Petroleum Council (WPC) in 1997.

Proved reserves

Proved reserves are those reserves claimed to have a reasonable certainty (normally at least 90% confidence) of being recoverable under existing economic and political conditions, with existing technology. Industry specialists refer to this as P90 (i.e. having a 90% certainty of being produced). Proved reserves are also known in the industry as 1P.

Proved reserves are further subdivided into Proved Developed (PD) and Proved Undeveloped (PUD). PD reserves are reserves that can be produced with existing wells and perforations, or from additional reservoirs where minimal additional investment (operating expense) is required. PUD reserves require additional capital investment (e.g. drilling new wells) to bring the oil to the surface.

Proved reserves are the only type the U.S. Securities and Exchange Commission allows oil companies to report to investors. Companies listed on U.S. stock exchanges must substantiate their claims, but many governments and national oil companies do not disclose verifying data to support their claims.

Unproved reserves

Unproved reserves are based on geological and/or engineering data similar to that used in estimates of proved reserves, but technical, contractual, or regulatory uncertainties preclude such reserves being classified as proved. Unproved reserves may be used internally by oil companies and government agencies for future planning purposes, but are not routinely compiled. They are sub classified as probable and possible

Probable reserves are attributed to known accumulations, and claim a 50% confidence level of recovery. Industry specialists refer to this as P50 (i.e. having a 50% certainty of being produced). Referred to in the industry as 2P (proved plus probable).

Possible reserves are attributed to known accumulations which have a less likely chance of being recovered than probable reserves. This term is often used for reserves which are claimed to have at least a 10% certainty of being produced (P10). Reasons for classifying reserves as possible include varying interpretations of geology, reserves not producible at commercial rates, uncertainty due to reserve infill (seepage from adjacent areas), projected reserves based on future recovery methods. Referred to in the industry as 3P (proved plus probable plus possible).

Strategic petroleum reserves

Many countries maintain government-controlled oil reserves for both economic and national security reasons. According to the United States Energy Information Administration, approximately of oil are held in strategic reserves, of which 1.4 billion is government-controlled. These reserves are generally not counted when computing a nations oil reserves.


A more sophisticated system of evaluating petroleum accumulations was adopted in 2007 by the Society of Petroleum Engineers (SPE), World Petroleum Council (WPC), American Association of Petroleum Geologists (AAPG), and Society of Petroleum Evaluation Engineers (SPEE). It incorporates the 1997 definitions for reserves, but adds categories for contingent resources and prospective resources.

Contingent resources are those quantities of petroleum estimated, as of a givendate, to be potentially recoverable from known accumulations, but the applied project(s)are not yet considered mature enough for commercial development due to one or morecontingencies. Contingent resources may include, for example, projects for which thereare currently no viable markets, or where commercial recovery is dependent ontechnology under development, or where evaluation of the accumulation is insufficient toclearly assess commerciality.

Prospective resources are those quantities of petroleum estimated, as of a givendate, to be potentially recoverable from undiscovered accumulations by application offuture development projects. Prospective resources have both an associated chance ofdiscovery and a chance of development.

The United States Geological Survey uses the terms technically and economically recoverable resources when making its petroleum resource assessments. Technically recoverable resources represent that proportion of assessed in-place petroleum that may be recoverable using current recovery technology, without regard to cost. Economically recoverable resources are technically recoverable petroleum for which the costs of discovery, development, production, and transport, including a return to capital, can be recovered at a given market price.

Unconventional resources exist in petroleum accumulations that are pervasive throughout a large area. Examples include extra heavy oil, natural bitumen, and oil shale deposits. Unlike Conventional resources, in which the petroleum is recovered through wellbores and typically requires minimal processing prior to sale, unconventional resources require specialized extraction technology to produce. For example, steam and/or solvents are used to mobilize bitumen for in-situ recovery. Moreover, the extracted petroleum may require significant processing prior to sale (e.g. bitumen upgraders). The total amount of unconventional oil resources in the world considerably exceeds the amount of conventional oil reserves, but are much more difficult and expensive to develop.

Estimation techniques

Example of a production decline curve for an individual well
The amount of oil in a subsurface reservoir is called oil in place (OIP). Only a fraction of this oil can be recovered from a reservoir. This fraction is called the recovery factor. The portion that can be recovered is considered to be a reserve. The portion that is not recoverable is not included unless and until methods are implemented to produce it.

There are a number of different methods of calculating oil reserves. These methods can be grouped into three general categories: volumetric, material balance, and production performance. Each method has its advantages and drawbacks.

Volumetric method

Volumetric methods attempt to determine the amount of oil-in-place by using the size of the reservoir as well as the physical properties of its rocks and fluids. Then a recovery factor is assumed, using assumptions from fields with similar characteristics. OIP is multiplied by the recovery factor to arrive at a reserve number. Current recovery factors for oil fields around the world typically range between 10 and 60 percent; some are over 80 percent. The wide variance is due largely to the diversity of fluid and reservoir characteristics for different deposits. The method is most useful early in the life of the reservoir, before significant production has occurred.

Materials balance method

The materials balance method for an oil field uses an equation that relates the volume of oil, water and gas that has been produced from a reservoir, and the change in reservoir pressure, to calculate the remaining oil. It assumes that as fluids from the reservoir are produced, there will be a change in the reservoir pressure that depends on the remaining volume of oil and gas. The method requires extensive pressure-volume-temperature analysis and an accurate pressure history of the field. It requires some production to occur (typically 5% to 10% of ultimate recovery), unless reliable pressure history can be used from a field with similar rock and fluid characteristics.

Production decline curve method

The decline curve method uses production data to fit a decline curve and estimate future oil production. The three most common forms of decline curves are exponential, hyperbolic, and harmonic. It is assumed that the production will decline on a reasonably smooth curve, and so allowances must be made for wells shut in and production restrictions. The curve can be expressed mathematically or plotted on a graph to estimate future production. It has the advantage of (implicitly) including all reservoir characteristics. It requires a sufficient history to establish a statistically significant trend, ideally when production is not curtailed by regulatory or other artificial conditions.

Reserves growth

Experience shows that initial estimates of the size of newly discovered oil fields are usually too low. As years pass, successive estimates of the ultimate recovery of fields tend to increase. The term reserve growth refers to the typical increases in estimated ultimate recovery that occur as oil fields are developed and produced.

Estimated reserves by country

Countries with largest oil reserves
Most of the world's oil reserves are in the Middle East.

Summary of Reserve Data as of 2008
Country Reserves Production Reserve life 1
109 bbl 109 m3 106 bbl/d 103 m3/d years
Saudi Arabia 72
Canada 149
Iran 95
Iraq 150
Kuwait 110
United Arab Emirates 93
Venezuela 88
Russia 17
Libya 66
Nigeria 41
Kazakhstan 59
United States 8
China 11
Qatar 46
Algeria 15
Brazil 14
Mexico 9
Total of top seventeen reserves 54

1 Reserve to Production ratio (in years), calculated as reserves / annual production. (from above)

OPEC countries

There are doubts about the reliability of official OPEC reserves estimates, which are not provided with any form of audit or verification that meet external reporting standards.

Since a system of country production quotas was introduced in the 1980s, partly based on reserves levels, there have been dramatic increases in reported reserves among Opec producers. In 1983, Kuwait increased its proven reserves from to . In 1985–86, the UAE almost tripled its reserves from to . Saudi Arabia raised its reported reserve number in 1988 by 50%. In 2001–02, Iran raised its proven reserves by some 30% to , which advanced it to second place in reserves and ahead of Iraq. Iran denied accusations of a political motive behind the readjustment, attributing the increase instead to a combination of new discoveries and improved recovery. No details were offered of how any of the upgrades were arrived at.

The following table illustrates these rises.

OPEC countries
oil reserves of OPEC 1980–2005

Declared reserves of major Opec Producers (billion of barrels)
BP Statistical Review - June 2009
Year Iranmarker Iraqmarker Kuwaitmarker Saudi Arabiamarker UAEmarker Venezuelamarker Libyamarker Nigeriamarker
1980 58.3 30.0 67.9 168.0 30.4 19.5 20.3 16.7
1981 57.0 32.0 67.7 167.9 32.2 19.9 22.6 16.5
1982 56.1 59.0 67.2 165.5 32.4 24.9 22.2 16.8
1983 55.3 65.0 67.0 168.8 32.3 25.9 21.8 16.6
1984 58.9 65.0 92.7 171.7 32.5 28.0 21.4 16.7
1985 59.0 65.0 92.5 171.5 33.0 54.5 21.3 16.6
1986 92.9 72.0 94.5 169.7 97.2 55.5 22.8 16.1
1987 92.9 100.0 94.5 169.6 98.1 58.1 22.8 16.0
1988 92.9 100.0 94.5 255.0 98.1 58.5 22.8 16.0
1989 92.9 100.0 97.1 260.1 98.1 59.0 22.8 16.0
1990 92.9 100.0 97.0 260.3 98.1 60.1 22.8 17.1
1991 92.9 100.0 96.5 260.9 98.1 62.6 22.8 20.0
1992 92.9 100.0 96.5 261.2 98.1 63.3 22.8 21.0
1993 92.9 100.0 96.5 261.4 98.1 64.4 22.8 21.0
1994 94.3 100.0 96.5 261.4 98.1 64.9 22.8 21.0
1995 93.7 100.0 96.5 261.5 98.1 66.3 29.5 20.8
1996 92.6 112.0 96.5 261.4 97.8 72.7 29.5 20.8
1997 92.6 112.5 96.5 261.5 97.8 74.9 29.5 20.8
1998 93.7 112.5 96.5 261.5 97.8 76.1 29.5 22.5
1999 93.1 112.5 96.5 262.8 97.8 76.8 29.5 29.0
2000 99.5 112.5 96.5 262.8 97.8 76.8 36.0 29.0
2001 99.1 115.0 96.5 262.7 97.8 77.7 36.0 31.5
2002 130.7 115.0 96.5 262.8 97.8 77.3 36.0 34.3
2003 133.3 115.0 99.0 262.7 97.8 77.2 39.1 35.3
2004 132.7 115.0 101.5 264.3 97.8 79.7 39.1 35.9
2005 137.5 115.0 101.5 264.2 97.8 80.0 41.5 36.2
2006 138.4 115.0 101.5 264.3 97.8 87.3 41.5 36.2
2007 138.2 115.0 101.5 264.2 97.8 99.4 43.7 36.2
2008 137.6 115.0 101.5 264.1 97.8 99.4 43.7 36.2

The sudden revisions in OPEC reserves, totaling nearly 300 bn barrels, have been much debated. Some of it is defended partly by the shift in ownership of reserves away from international oil companies, some of whom were obliged to report reserves under conservative US Securities and Exchange Commission rules. The most prominent explanation of the revisions is prompted by a change in OPEC rules which set production quotas (partly) on reserves. In any event, the revisions in official data had little to do with the actual discovery of new reserves. Total reserves in many OPEC countries hardly changed in the 1990s. Official reserves in Kuwait, for example, were unchanged at (including its share of the Neutral Zone) from 1991 to 2002, even though the country produced more than and did not make any important new discoveries during that period. The case of Saudi Arabia is also striking, with proven reserves estimated at between 260 and in the past 18 years, a variation of less than 2% while extracting approximately during this period.

Sadad al-Huseini, former head of exploration and production at Saudi Aramco, estimates of the world’s of proved reserves should be recategorized as speculative resources, though he did not specify which countries had inflated their reserves. Dr. Ali Samsam Bakhtiari, a former senior expert of the National Iranian Oil Company, has estimated that Iran, Iraq, Kuwait, Saudi Arabia and the United Arab Emirates have overstated reserves by a combined 320–390bn barrels, and "As for Iran, the usually accepted official is almost one hundred billion over any realistic assay". Petroleum Intelligence Weekly reported that official confidential Kuwaiti documents estimate reserves of Kuwait were only , of which half were proven and half were possible. The combined value of proven and possible is half of the official public estimate of proven reserves.

Prospective resources

Arctic Prospective Resources

Location of Arctic Basins assessed by the USGS

A 2008 United States Geological Survey estimates that areas north of the Arctic Circle have of undiscovered, technically recoverable oil (and of natural gas liquids ) in 25 geologically defined areas thought to have potential for petroleum. This represented 13% of the expected undiscovered oil in the world. Of the estimated totals, more than half of the undiscovered oil resources were estimated to occur in just three geologic provinces – Arctic Alaska, the Amerasia Basin, and the East Greenland Rift Basins. More than 70% of the mean undiscovered oil resources was estimated to occur in five provinces: Arctic Alaska, Amerasia Basin, East Greenland Rift Basins, East Barents Basins, and West Greenland–East Canada. It was further estimated that approximately 84% of the oil and gas would occur offshore. The USGS did not consider economic factors such as the effects of permanent sea ice or oceanic water depth in its assessment of undiscovered oil and gas resources. This assessment was lower than a 2000 survey, which had included lands south of the arctic circle.

Miscellaneous Prospective Resources

The Exclusive Economic Zone is a delineated offshore area, mostly to the west and north of Cuba which under international agreements is owned by Cuba. This 112,000 square kilometer zone has been divided into 59 exploration blocks. A 2004 joint partnership between a Spanish oil company and Cuba’s state oil company (CUPET) estimated Cuba's off-shore reserves to be able to ultimately produce between 4.6 and 9.3billion barrels of crude oil. The US Geological Survey (USGS) estimates that Cuba has resources up to of oil. In October 2008, the Cuban government announced that it had discovered oil basins which would double its total oil resources to . Note that consistent with the definitions of Reserves and Resources as given in the above sections, at this stage (June 2009), given no commercial discoveries to date, all recoverable oil estimates in the Exclusive Economic Zone (EEZ) are Prospective Resources estimates and not Reserves estimates.

See also


  1. >
  2. PennWell Corporation, Oil & Gas Journal, Vol. 105.48 (December 24, 2007), except United States. Oil includes crude oil and condensate. Data for the United States are from the Energy Information Administration, U.S. Crude Oil, Natural Gas, and Natural Gas Liquids Reserves, 2006 Annual Report, DOE/EIA-0216(2007) (November 2007). Oil & Gas Journal's oil reserve estimate for Canada includes of conventional crude oil and condensate reserves and of oil sands reserves. Information collated by EIA
  3. U.S. Energy Information Administration (EIA) – U.S. Government – U.S. Dept. of Energy, October, 2008 EIA - Petroleum Data, Reports, Analysis, Surveys
  4. BBC: claims massive oil reserves

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