--> Abstract: Impending Changes in Resources Reporting and Auditing, by John R. Etherington; #90082 (2008)

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Impending Changes in Resources Reporting and Auditing

John R. Etherington
Managing Director, Petroleum Resource Analysts (PRA) International Ltd, Calgary, AB, Canada

The way in which we assess and report reserves and resources is on the verge of major changes. There is a growing recognition that international standards are required to promote comparability and support global commerce. Governments want a full inventory of their mineral and petroleum resources, investors and financial advisors want more detailed information on production and cash flow schedules, and the operators are seeking improved project and portfolio management tools. Moreover, the variations between petroleum and minerals reporting are being questioned, specifically in the energy supply sector.

Several organizations are cooperating in addressing the challenges. The International Accounting Standards Board (IASB) is seeking accounting standards and disclosure rules that equally apply to the minerals and petroleum industries’ upstream activities. The United Nations Classification Framework is focused on a single umbrella system for petroleum and minerals reserves and resources reporting to governments. Industry support of both these initiatives comes through the Society of Petroleum Engineers (SPE) and the Committee for Mineral Reserves International Reporting Standards (CRIRSCO). These organizations have formed a joint committee to ensure that resource analyses are based on rigorous application of existing guidelines established by each industry.

The role of resource auditors will also need to change to address the needs of all stakeholders. The current work process flow model may not be adequate to validate a full range of resource estimates with varying technical and commercial risks. Increased coordination between reserves and financial audits will be required. The goal is to ensure consistency and completeness in reporting without burdening the industry with excessive controls and compromising proprietary information.

AAPG International Conference and Exhibition, Cape Town, South Africa 2008 © AAPG Search and Discovery