Application of a probabilistic approach in the assessment and integrated expert review of capital oil and gas production projects

UDK: 622.276.1/.4

DOI: 10.24887/0028-2448-2026-6-71-74

Key words: investment decision, hydrocarbon fields, uncertainties, probabilistic approach, production forecast, statistical processing, technical and economic evaluation

Authors: N.A. Petrov (Zarubezhneft JSC, RF, Moscow); I.S. Afanasyev (Zarubezhneft JSC, RF, Moscow); M.A. Gladkov (Zarubezhneft JSC, RF, Moscow); K.A. Sedykh (Zarubezhneft JSC, RF, Moscow); G.A. Fursov (Vietsovpetro JV, the Socialist Republic of Vietnam, Vung Tau)

The investment decision-making process for early-stage projects in the oil and gas industry is associated with high levels of uncertainties and risks due to limited geological data accuracy, variability in development technology parameters, and volatility of macroeconomic environment. A comprehensive integrated probabilistic methodology was developed to address these challenges. It provides systematic identification of key technical uncertainty groups, analysis of corresponding probability distributions, and sequential integration of all computation stages into a unified automated workflow controlled externally via MS Excel and API interfaces. Multivariate modeling followed by statistical processing of results enable to derive standard P10, P50, P90 cases for cumulative oil production and net present value (NPV), but also quantitative estimation of positive economic outcome probability. The practical implementation of the approach is demonstrated on a real oil field using specialized software and an external control system. The case study shows that the probabilistic approach enables a quantitative assessment of the range of possible cumulative production and NPV values, evaluation of the baseline deterministic forecast reliability, and adjustment of target production profile to a more realistic P50 scenario. The obtained results formed the basis for the positive investment decision to launch the project; subsequent actual production performance after start-up confirmed the conservative assumption of the baseline scenario and corresponded to P30, thereby validating the effectiveness of comprehensive uncertainty integration at early planning stages.

References

1. Merrow E.W., Industrial megaprojects. Concepts, strategies, and practices for success, Hoboken, New Jersey: John Wiley & Sons, Inc., 2011, 414 p.,

DOI: https://doi.org/10.1002/9781119201045

2. Mohus E., Over budget, Over time, and reduced revenue, over and over again – An analysis of the Norwegian petroleum industry’s inability to forecast production: Master thesis, University of Stavanger, 2018, 122 p.

3. OTC-26309-MS. Reservoir-schedule coupled uncertainty analysis for PD projects: Optimization opportunities and improvements for more robust production forecasts, 2015, 12 p.

4. Silveira M. et al., Utilization of the GRM (Geological Representative Models) to integrate different types of uncertainties in the decision making process,

SPE-120924-MS, 2009, DOI: https://doi.org/10.2118/120924-MS

5. Williams G. et al., Top-down reservoir modeling, SPE-89974-MS, 2004, DOI: https://doi.org/10.2118/89974-MS