October 31, 1975 - Gerald R. Ford Presidential Library and Museum

4. The relationship between proved reserves of crude oil, associated
natural gas, and nonassociated natural gas to production in 1974.
5. The relationship between estimated proved reserves to original
hydrocarbons in place.
6. The relationship between indicated and secondary recovery
reserves to original hydrocarbons in place.
7. The relationship between gross additions to estimated proved
reserves in 1974 to estimated proved reserves at year end 1974.
Estimated Proved Reserves
Expansion of Survey Responses to the Universe
Because operators were not required to report reserves for those
fields in which an operator produced less than 20,000 barrels of oil or
100 million cubic feet of gas in 1974 and because response was not quite
complete, reported information needed to be expanded into U.S. totals.
The basis for expanding to the universe was 1973 oil and gas production.
Benchmark volumes were based on State data augmented by information
provided to the U.S. Bureau of Mines (USBM). Estimates were made for
associated gas production for States that did not furnish this infor­
"mation (Illinois, Indiana, Kentucky, Missouri, Nevada, and New York).
The procedure for estimating total reserves for each State was as
follows:
1. Production for year 1973 and estimated proved reserves for produC"ing
reservoirs were surrmed for all reports which included both items.
2. For reports which showed production but no estimated proved
reserves for producing reservoirs, production was summed on the basis of
years of reported production; i.e., 1970-1974, 1971-1974, 1972-1974,
1973-1974, and 1974 only.
3. Reserve calculations for group totals in step 2 were determined
as follows. For reports showing 1974 production only, the estimate was
based upon 1975 production being equal to that of 1974 and projecting
future rates by a hyperbolic curve decl"in"ing at 10 percent per year for
14 additional years; for the other groups a curve fit was made. Declines
greater than 10 percent per year were projected at the calculated rate
for 15 years; for lesser declines, a rate of 10 percent was projected
for 15 years.
4. The sums of reserves determined in step 1 and those in step 3,
excepting the 1974 production-only group, were multiplied by the ratio
of State-wide benchmark production in 1973 to correlative sums of
production.
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