ExxonMobil Corp. added 1.8 billion boe to its proved reserves base in 2011, replacing 107% of natural gas and production, the company said last week. Proved reserves now stand at 24.9 billion boe, weighted 51% to natural gas and 49% to liquids.
Excluding asset sales, reserves additions replaced 116% of production. Last year was the 18th in a row that the oil major replaced more than 100% of its annual output, said CEO Rex W. Tillerson, who credited the company’s “strategic focus on quality resource capture,” along with disciplined investments and solid project execution. The annual proved reserves report is part of the Irving, TX-based explorer’s process to ensure “consistency and management accountability in all reserves bookings.”
“During challenging times for the global economy, we continue to take a long-term view of resource development and invest throughout the commodity price cycle,” said Tillerson. “Adding reserves enables ExxonMobil to develop new supplies of energy to meet future demand and support economic growth and improved standards of living.”
An estimated 0.4 billion boe of proved natural gas reserves were added to the base in 2011, which was a 49% replacement rate. Liquid additions totaled 1.4 billion boe for a 166% replacement ratio. Asset sales last year reduced proved reserves by an estimated 141 million boe. Most of the reserves additions in 2011 came from the Kearl oilsands expansion project in Canada, which by itself added 1 billion boe.
Proved additions also came from the United States, where ExxonMobil is the top natural gas producer. In addition, reserves were added from projects in Nigeria, Norway, Indonesia and Malaysia.
Reserves additions in 2011 reflected new developments with “significant funding commitments as well as revisions and extensions of existing fields resulting from drilling, studies and analysis of reservoir performance,” the producer said.
“The long-term nature of the industry, and the large size of the discrete projects that provide a significant portion of the corporation’s reserves additions, make it appropriate to consider a time horizon longer than a single year,” it said. “The 10-year average reserves replacement ratio is 121%, with liquids replacement at 99% and gas at 150%. The reserves additions made during this period comprise a diverse range of resource types and have broad geographical representation. ExxonMobil’s reserves life at current production rates is 15 years.”
ExxonMobil also said it added 4.1 billion boe to its resource base in 2011, driven primarily by additions from the United States and Canada, as well as Australia, Indonesia and Vietnam. The terms “resources” and “resource base” include quantities of discovered natural gas and oil that are not yet classified as proved but that are expected to be ultimately recovered in the future.
“These additions include continued success in by-the-bit exploration discoveries, undeveloped resource additions and strategic acquisitions,” the company said. “ExxonMobil’s by-the-bit conventional exploration success in 2011 included discoveries in the U.S. Gulf of Mexico, Australia, Indonesia and Vietnam. In addition, discovery and delineation of North American unconventional assets contributed significantly to the resource base.
“Overall, the corporation’s resource base grew by 2.7 billion boe to 87.2 billion boe, taking into account field revisions, production and asset sales. The resource base includes proved reserves, plus other discovered resources that are expected to be ultimately recovered.”
ExxonMobil said proved reserves for 2009 and after are based on current Securities and Exchange Commission (SEC) definitions. Before 2009 the proved reserve volumes were determined under different SEC definitions. Today producers may report probable and possible reserves along with proved reserves (see NGI, Jan. 5, 2009). Also, before 2009 oilsands and company equity reserves were not included in proved reserves as defined by the SEC.
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