Proved reserves are quantities of reserves that appear with reasonable certainty to be recoverable in the future from known oil and gas reserves based on geologic and engineering data and under existing economic and operating conditions.
How it’s important to us
Proved reserves are important in determining economic value of assets under an O&G company’s control. Along with probable and possible reserves, they are used to determine cash forecasts and report company health to the SEC and investors. Proved reserves are subdivided into two categories: proved developed reserves and proved undeveloped reserves. Developed reserves refer to reserves that can be expected to be recovered through existing wells and existing equipment and operating methods. Undeveloped reserves are reserves expected to be recovered through the drilling of new wells on undrilled proved acreage or from existing wells where a relatively major expenditure is required for completion.
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