24-Pet-B3 Petroleum Geology · May 2016
Nivaar worked solution (AI-drafted; not reviewed by a licensed engineer)
National Exams, May 2016 — 98-Pet-B3, Oil and Gas Evaluation and Economics (3 hours, closed book, approved non-programmable calculator only). The exam's own cover page is titled "Oil and Gas Evaluation and Economics" and every question is property valuation / reserves & production economics / DCF-NPV screening content — no geology anywhere.
Reference texts: Thompson & Wright, Oil Property Evaluation; Canadian Oil and Gas Evaluation Handbook (COGEH), Vol. 1 (Society of Petroleum Evaluation Engineers, Calgary Chapter); National Instrument 51-101, Standards of Disclosure for Oil and Gas Activities (Canadian Securities Administrators); SPE/WPC/AAPG/SPEE Petroleum Resources Management System (PRMS); Economides & Nolte, Reservoir Stimulation; Ahmed, Reservoir Engineering Handbook.
The exam's own instructions ask for only 7 of the 10 short-answer questions and note the Cash-Flow/Future-Value tables are graded by column; for "choose N of M" exams, every item below is answered in full as a study resource. Questions 1–10 correspond to the exam's printed Short-Answer items 1–10; Questions 11–20 correspond to the printed Multiple-Choice items 1–10; Question 21 is the Future Value table; Question 22 is the Cash Flow table.
Question text not reproduced: the examination questions are © Engineers and Geoscientists BC. Open the official past paper (linked at the top of this page) to read the question, then follow the worked solution below.
a. Development of shale gas resources in North America
b. Shutdown of nuclear reactors in Japan
c. Lack of gas pipelines and LNG terminals on the west coast of North America
d. Economic downturn
e. All of the above ← correct
Answer: (e) All of the above. Each factor pushed on gas prices in a different region: North American shale development pushed Henry Hub prices down by expanding supply; the 2011 Fukushima accident forced Japan's nuclear fleet offline, sharply raising Japanese LNG demand and Asian LNG prices; the absence of West Coast Canadian/US LNG export terminals and connecting pipelines trapped cheap North American gas that could otherwise have relieved that Asian demand; and the broader post-2008 economic downturn softened industrial gas demand in several regions at the same time. All four genuinely contributed over the same 3–4 year window, in different directions and different markets.
