Woodside Petroleum Ltd| Corporate 67
Notes to the reserves and resources statement
1. ‘Reserves’ are estimated quantities of petroleum that have been
demonstrated to be producible from known accumulations in which
the company has a material interest from a given date forward, at
commercial rates, under presently anticipated production methods,
operating conditions, prices and costs.
2. Assessment of the economic value of a project, in support of a reserves
booking, uses Woodside Portfolio Economic Assumptions (PEAs). The
PEAs are reviewed on an annual basis or more often if required. The
review is based on historical data and forecast estimates for economic
variables such as product prices and exchange rates. The PEAs are
approved by the Woodside Board. Specific contractual arrangements
for individual projects are also taken into account.
3. Woodside uses both deterministic and probabilistic methods for
estimation of petroleum resources at the field and project levels. Unless
otherwise stated, all petroleum estimates reported at the company
or region level are aggregated by arithmetic summation by category.
Note that the aggregated Proved level may be a very conservative
estimate due to the portfolio eects of arithmetic summation.
4. Woodside reports reserves net of the fuel and flare required for
production, processing and transportation up to a reference point.
For oshore oil projects and floating liquefied natural gas (FLNG)
projects, the reference point is defined as the outlet of the floating
production storage ooading (FPSO) facility or FLNG facility
respectively, while for onshore gas projects the reference point is
defined as the inlet to the downstream (onshore) processing facility.
Downstream fuel and flare represents 10.6% of Woodside’s Proved
(Developed and Undeveloped) reserves, and 10.5% of Proved plus
Probable (Developed and Undeveloped) reserves.
5. ‘Contingent resources’ are those quantities of petroleum estimated,
as of a given date, 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 more
contingencies. Contingent resources may include, for example,
projects for which there are currently no viable markets, or
where commercial recovery is dependent on technology under
development, or where evaluation of the accumulation is insucient
to clearly assess commerciality. Woodside reports contingent
resources net of the fuel and flare required for production, processing
and transportation up to a reference point and non-hydrocarbons not
present in sales products. Contingent resources estimates may not
always mature to reserves and do not necessarily represent future
reserves bookings. All contingent resource volumes are reported at
the ‘Best Estimate’ (P50) confidence level.
6. ‘Dry gas’ is defined as ‘C4 minus’ petroleum components including
non-hydrocarbons. These volumes include LPG (propane and butane)
resources. Dry gas reserves and contingent resources include ‘C4
minus’ hydrocarbon components and non-hydrocarbon volumes that
are present in sales product.
7. ‘Condensate’ is defined as ‘C5 plus’ petroleum components.
8. ‘Bcf’ means billions (109) of cubic feet of gas at standard oilfield
conditions of 14.696 psi (101.325 kPa) and 60 degrees Fahrenheit
(15.56 degrees Celsius).
9. ‘MMbbl’ means millions (106) of barrels of oil and condensate at
standard oilfield conditions of 14.696 psi (101.325 kPa) and 60
degrees Fahrenheit (15.56 degrees Celsius).
10. ‘MMboe’ means millions (106) of barrels of oil equivalent. Consistent
with international practice, dry gas volumes are converted to oil
equivalent volumes via a constant conversion factor, which for
Woodside is 5.7 Bcf of dry gas per 1 MMboe. Volumes of oil and
condensate are converted from MMbbl to MMboe on a 1:1 ratio.
11. ‘Proved reserves’ are those reserves which analysis of geological
and engineering data suggests, to a high degree of certainty (90%
confidence), are recoverable. There is relatively little risk associated
with these reserves.
12. ‘Probable reserves’ are those reserves which analysis of geological and
engineering data suggests are more likely than not to be recoverable.
Proved plus Probable reserves represent the best estimate of
recoverable quantities. Where probabilistic methods are used, there
is at least a 50% probability that the quantities actually recovered will
exceed the sum of estimated Proved plus Probable reserves.
13. ‘Developed reserves’ are those reserves that are producible through
currently existing completions and installed facilities for treatment,
compression, transportation and delivery, using existing operating
methods and standards.
14. ‘Undeveloped reserves’ are those reserves for which wells and
facilities have not been installed or executed but are expected to be
recovered through future investments.
15. The ‘reserves replacement ratio’ is the reserves (Developed and
Undeveloped) change during the year, before the deduction of
production, divided by production during the year. The ‘three-
year reserves replacement ratio’ is the reserves (Developed and
Undeveloped) change over three years, before the deduction of
production for that period, divided by production during the
same period.
16. The ‘organic annual reserves replacement ratio’ is the reserves
(Developed and Undeveloped) change during the year, before
the deduction of production and adjustment for acquisition and
divestments, divided by production during the year.
17. The ‘reserves life’ is the reserves (Developed and Undeveloped)
divided by production during the year.
18. ‘Annual production’ is the volume of dry gas, condensate and oil
produced during the year and converted to ’MMboe’ for the specific
purpose of reserves reconciliation and the calculation of reserves
replacement ratios. The ‘Reserves and Resources Statement’
annual production diers from production volumes reported in the
company’s annual and quarterly reports due to dierences between
the sales and reserves product definitions, reserves being reported
gross of downstream fuel and flare and the ‘MMboe’ conversion
factors applied. Woodside’s NWS pipeline gas production for the
purpose of dry gas reserves reconciliation is based on the Woodside
equity share. Any imbalance resulting from independently marketed
pipeline gas sales will be reconciled before project abandonment.
19. ‘Revision of previous estimates’ are changes in previous estimates of
reserves or contingent resources, either up or down, resulting from
new information normally obtained from development drilling and
production history or resulting from a change in economic factors or
reservoir modelling to estimate volumes reasonably expected to be
recovered from wells in the relevant project.
20. ‘Extensions and discoveries’ represent additions to reserves or
contingent resources that result from increased areal extensions
of previously discovered fields, discovery of reserves or contingent
resources in new fields, or new reservoirs in old fields.
21. The ‘Greater Pluto’ region comprises the Pluto-Xena, Larsen, Martell,
Martin, Noblige, Pyxis and Remy fields.
22. The ‘North West Shelf’ (NWS) includes all oil and gas fields within the
North West Shelf Project Area. As the NWS consists of a portfolio of
fields, probabilistic aggregation is more appropriate than arithmetic
summation as inter-field dependencies reflecting dierent reservoir
characteristics between fields are incorporated. Probabilistic
aggregation of individual fields in the NWS accounts for 20.3% of
NWS Proved (Developed and Undeveloped) dry gas reserves, 27.4%
of NWS Proved (Developed and Undeveloped) condensate reserves.
23. The ‘Greater Exmouth’ region comprises the Vincent, Enfield, Greater
Enfield, Greater Laverda, Ragnar and Toro fields.
24. The ‘Wheatstone’ region comprises the Julimar and Brunello fields.
25. The ‘Canada’ region comprises unconventional resources in the
Liard and Horn River Basins. Previously reported Canada reserves,
all associated with pipeline gas, have been reclassified to Contingent
Resources using definitions and guidelines consistent with the 2018
Society of Petroleum Engineers (SPE)/World Petroleum Council
(WPC)/American Association of Petroleum Geologists (AAPG)/
Society of Petroleum Evaluation Engineers (SPEE) Petroleum
Resources Management System (PRMS).
26. The ‘Greater Browse’ region comprises the Brecknock, Calliance and
Torosa fields.
27. The ‘Greater Scarborough’ region comprises the Jupiter, Scarborough
and Thebe fields.
28. The ‘Greater Sunrise’ region comprises the Sunrise and Troubadour fields.
29. The ‘Myanmar’ region comprises the Pyi Thit and Shwe Yee Htun
fields with well results and discovered volumes within Block A-6
supporting consideration of concept selection in the near term.
30. The ‘Senegal’ region comprises the SNE field and includes oil and gas
estimates for the SNE development phases including the opportunity
to export pipeline gas to shore.
31. Material concentrations of undeveloped reserves in Greater Pluto and
North West Shelf have remained undeveloped for longer than five
years from the dates they were initially reported, as the incremental
reserves are expected to be recovered through future developments
to meet long-term contractual commitments. The incremental
projects are included in the company business plan, demonstrating
the intent to proceed with the developments.