Petroleum Resource Management System (PRMS)

What is a Petroleum Resource Management System (PRMS)?

The petroleum resource management system is a document collaboratively written by some of the most influential organizations in the petroleum industry such as WPC, SPE, SPEE and AAPG. This document is used as a standard reference to guide companies in the classification of resources in the oil and gas industry.

The petroleum resources management system (PRMS) provides a consistent approach to estimating petroleum quantities, evaluating development projects, and presenting results within a comprehensive classification framework.

1 HOW RESOURCES ARE CLASSIFIED USING THE PRMS FRAMEWORK.

In the petroleum industry projects are classified into one of three main categories using the petroleum

The level of development a project reaches is determined by business decisions that are required to move forward on commercially producing from that or those accumulation/s. According to (Ross, 2011), ‘The boundaries between different levels of project maturity may align with internal (corporate) project “decision gates,” thus providing a direct link between the decision-making process within a company and characterization of its portfolio through resource classification. This link can also act to facilitate the consistent assignment of appropriate quantified risk factors for the chance of commerciality.’ For different companies the evaluation process may or may not differ based on their internal obligations and standards but the concept of ‘increasing chance of commerciality’ should

Development Pending is limited to those projects that are actively subject to project-specific technical activities, such as appraisal drilling or detailed evaluation that is designed to confirm commerciality and/or to determine the optimum development scenario.

5. Development Unclarified or On Hold comprises two situations. Projects that are classified as On Hold would generally be where a project is considered to have at least a reasonable chance of commerciality, but where there are major nontechnical contingencies (e.g., environmental issues).

Note: - The primary difference between Development Pending and On Hold is development pending are in the hands of the developers, however, development on hold is out of the hand of developers but rather and issue of the environment.

6. Projects are considered to be Unclarified if they are still under evaluation (e.g., a recent discovery) or require significant further appraisal to clarify the potential for development.

7. Where a technically viable project has been assessed as being of insufficient potential to warrant any further appraisal activities or any direct efforts to remove commercial contingencies, it should be classified as Development not Viable. Projects in this subclass would be expected to have a low chance of