The search for an area for probable exploration. The search normally includes geological and geophysical studies of relatively large areas undertaken in an attempt to locate specific areas warranting detailed exploration. Prospecting usually occurs prior to the acquisition of mineral rights.
Primary target usually refers to the most important reservoir which an O&G company hopes will contain hydrocarbons when drilling. Secondary target refers to other possible reservoirs that may be above or below the primary target, which are usually thought to be not as attractive for various reasons as the primary target, possibly because they are …
When exploratory wells find commercially viable natural gas or petroleum deposits, it is economical to build a permanent platform from which well completion, extraction, and production can occur. These large, permanent platforms are extremely expensive, however, and generally require large expected hydrocarbon deposits to be economical to construct. Some of the largest offshore platforms are …
An agreement between the parties to a well and a host country regarding the percentage of production each party will receive after the parties participating in all the expenses have recovered a specified amount of costs and expenses. The contractor usually bears all risk and costs for exploration, development and production. In return, if exploration …
In a farmout agreement, this is the ratio between expenditure and interest earned in a license. An arrangement whereby a farmee reimburses the farmor’s past costs and pays for exploration work and then takes a pro rata share of the farmor’s interest is known as a ground floor deal, but if the farmee only earns …
This is the danger of political or financial instability in the host country caused by events such as insurrections, strikes, suspension of foreign exchange, creeping expropriation and outright nationalization. It also includes the risk that a government may be able to avoid its contractual obligations through sovereign immunity doctrines. Common mechanisms for minimizing political risk …
Joining together of several small acreages for the joint development of wells
Are both related to rock characteristics and are two of the primary factors that control the movement and storage of fluids in rocks and sediments. The exploitation of petroleum is partially dependent on the properties of porosity and permeability. Porosity is the ratio of the volume of openings (voids) to the total volume of material. …
Continue reading “Porosity and Permeability – Porous and Permeable”
Unproved reserves which analysis of geological and engineering data suggests are less likely to be recoverable than probable reserves. When probabilistic methods are used, there should be at least a 10% probability (P10) that the quantities actually recovered will equal or exceed the amount of estimated reserves. Also often referred to as P3. Possible reserves …
Colloquial, non-industry-specific term for a rate structure in which each customer in a given class is charged the same rate for a commodity as every other customer, regardless of the cost of serving different customers in the same class. Also refers to rates set for all customers in a given territory regardless of their distance …
