3P

AAA

DEFINITION of '3P'

The total amount of reserves that a company estimates having access to, calculated as the sum of all proved and unproved reserves. Unproved reserves are broken into two segments: those based on geological and engineering estimates from proved sources (probable) and those that are less likely to be extracted due to financial or technical difficulties (possible). Therefore, 3P refers to proved plus probable plus possible reserves.

INVESTOPEDIA EXPLAINS '3P'

Energy companies update their investors on the amount of oil and natural gas reserves they have access to through a reserve update. This update typically includes proved, probable and possible reserves, and is similar to an inventory report that a retailer might provide to investors.


The 3P estimate is a rosy estimate of what might actually be pumped out of a well. Probable reserves are generally given 50% certainty (P50), and possible reserves are given 10% certainty (P10).

RELATED TERMS
  1. Commercial Well

    Any oil or gas drilling site that produces enough oil or gas ...
  2. Oil Field

    A tract of land used for extracting petroleum, or crude oil, ...
  3. Hubbert Curve

    A statistical theory of oil production that states that the rate ...
  4. Crude Oil

    A naturally occurring, unrefined petroleum product composed of ...
  5. Proven Reserves

    After an oil exploration firm conducts a seismic survey on a ...
  6. Oil Reserves

    An estimate of the amount of crude oil located in a particular ...
Related Articles
  1. Peak Oil: What To Do When The Wells ...
    Economics

    Peak Oil: What To Do When The Wells ...

  2. Oil: A Big Investment With Big Tax Breaks
    Investing Basics

    Oil: A Big Investment With Big Tax Breaks

  3. Oil And Gas Industry Primer
    Active Trading

    Oil And Gas Industry Primer

  4. Uncovering Oil And Gas Futures
    Active Trading

    Uncovering Oil And Gas Futures

comments powered by Disqus
Hot Definitions
  1. Correlation

    In the world of finance, a statistical measure of how two securities move in relation to each other. Correlations are used ...
  2. Letter Of Credit

    A letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. ...
  3. Due Diligence - DD

    1. An investigation or audit of a potential investment. Due diligence serves to confirm all material facts in regards to ...
  4. Certificate Of Deposit - CD

    A savings certificate entitling the bearer to receive interest. A CD bears a maturity date, a specified fixed interest rate ...
  5. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  6. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
Trading Center