Occidental Petroleum 2014 Annual Report Download - page 143

PETROLEUM RESERVES DEFINITIONS
As Adapted From:
RULE 4-10(a) of REGULATION S-X PART 210
UNITED STATES SECURITIES AND EXCHANGE COMMISSION (SEC)
PREAMBLE
On January 14, 2009, the United States Securities and Exchange Commission (SEC) published the “Modernization of Oil
and Gas Reporting; Final Rule” in the Federal Register of National Archives and Records Administration (NARA). The
“Modernization of Oil and Gas Reporting; Final Rule” includes revisions and additions to the definition section in Rule 4-10 of
Regulation S-X, revisions and additions to the oil and gas reporting requirements in Regulation S-K, and amends and codifies
Industry Guide 2 in Regulation S-K. The “Modernization of Oil and Gas Reporting; Final Rule”, including all references to Regulation
S-X and Regulation S-K, shall be referred to herein collectively as the “SEC regulations”. The SEC regulations take effect for all
filings made with the United States Securities and Exchange Commission as of December 31, 2009, or after January 1, 2010.
Reference should be made to the full text under Title 17, Code of Federal Regulations, Regulation S-X Part 210, Rule 4-10(a) for the
complete definitions (direct passages excerpted in part or wholly from the aforementioned SEC document are denoted in italics
herein).
Reserves are estimated remaining quantities of oil and gas and related substances anticipated to be economically
producible, as of a given date, by application of development projects to known accumulations. All reserve estimates involve an
assessment of the uncertainty relating the likelihood that the actual remaining quantities recovered will be greater or less than the
estimated quantities determined as of the date the estimate is made. The uncertainty depends chiefly on the amount of reliable
geologic and engineering data available at the time of the estimate and the interpretation of these data. The relative degree of
uncertainty may be conveyed by placing reserves into one of two principal classifications, either proved or unproved. Unproved
reserves are less certain to be recovered than proved reserves and may be further sub-classified as probable and possible
reserves to denote progressively increasing uncertainty in their recoverability. Under the SEC regulations as of December 31,
2009, or after January 1, 2010, a company may optionally disclose estimated quantities of probable or possible oil and gas
reserves in documents publicly filed with the SEC. The SEC regulations continue to prohibit disclosure of estimates of oil and gas
resources other than reserves and any estimated values of such resources in any document publicly filed with the SEC unless
such information is required to be disclosed in the document by foreign or state law as noted in §229.1202 Instruction to Item 1202.
Reserves estimates will generally be revised only as additional geologic or engineering data become available or as
economic conditions change.
Reserves may be attributed to either natural energy or improved recovery methods. Improved recovery methods include all
methods for supplementing natural energy or altering natural forces in the reservoir to increase ultimate recovery. Examples of
such methods are pressure maintenance, natural gas cycling, waterflooding, thermal methods, chemical flooding, and the use of
miscible and immiscible displacement fluids. Other improved recovery methods may be developed in the future as petroleum
technology continues to evolve.
Reserves may be attributed to either conventional or unconventional petroleum accumulations. Petroleum accumulations
are considered as either conventional or unconventional based on the nature of their in-place characteristics, extraction method
applied, or degree of processing prior to sale.
RYDER SCOTT COMPANY PETROLEUM CONSULTANTS