Estimated Ultimate Recovery (EUR)

What is EUR?

Estimated Ultimate Recovery (EUR) is an industry term for the total quantity of oil or gas that is expected to be economically recoverable from a well, field, or reservoir over its productive life. It includes volumes already produced plus the remaining recoverable resource and is conceptually similar to recoverable reserves.

Reserve categories

EUR is commonly expressed as a range of recoverable volumes divided into three confidence-based categories:

• Proven reserves (1P) — >90% probability of recovery.
• Probable reserves (2P, incremental to proven) — >50% probability of recovery.
• Possible reserves (3P, incremental to probable) — significant chance but <50% probability of recovery.

These categories reflect the likelihood that the resource can be produced using current technology and under current economic conditions.

How classifications change

Reserves can be reclassified over time as technologies, operating practices, and economics change. For example:

• Improved recovery methods can convert possible or probable reserves into proven reserves.
• Rising oil prices can make higher‑cost resources economic, increasing proven reserves.
• Falling prices or higher costs can push reserves into lower‑confidence categories.

How EUR is estimated

EUR can be derived using various methods and units, including decline-curve analysis, reservoir simulation, volumetric calculations, and probabilistic techniques. The specific method depends on data availability, reservoir complexity, and the purpose of the estimate.

Role of EUR in valuation and decision making

EUR is a fundamental input for investment decisions in oil and gas projects. It is used to estimate the net present value (NPV) and economic viability of exploration, development, and production projects. Typical valuation inputs include:

• EUR (total recoverable volumes)
• Cost to bring first production and ongoing operating costs
• Cost of capital and discount rates
• Long-term price assumptions for oil and gas

Without a defensible EUR, it is difficult to produce reliable valuations or make rational capital-allocation decisions.

Key takeaways

• EUR quantifies the total expected recoverable oil or gas from a well or field, combining volumes already produced and those yet to be produced.
• It is reported across proven, probable, and possible categories reflecting increasing uncertainty.
• EUR estimates change with technology, recovery methods, and commodity prices.
• Accurate EUR estimates are essential for NPV calculations, project viability assessments, and investment decisions.