Trillion Cubic Feet (Tcf)

Trillion cubic feet (Tcf) is a volume measurement of natural gas used by the U.S. oil and gas industry. A trillion (1,000,000,000,000) cubic feet is equivalent to approximately one Quad of Btu (British thermal unit). A Quad is an abbreviation for a quadrillion (1,000,000,000,000,000) Btu. A Btu is a unit of measurement for energy, representing the amount of heat that is needed to raise the temperature of one pound of water by one degree Fahrenheit at sea level. One Btu is roughly equal to the heat produced by a kitchen stick match.

Trillion cubic feet is commonly abbreviated Tcf. Similarly, Bcf refers to a billion cubic feet, a gas measurement equal to approximately one trillion (1,000,000,000,000) Btu. Mcf stands for one thousand cubic feet, a measure that is used more commonly in the low volume segments of the gas industry, such as stripper well production.

Within the oil and gas industry, units of measurement are represented by letters where M = one thousand, MM = one million, B = one billion and T = one trillion. Any of these can appear before certain terms, such as MMBOE (million barrel of oil equivalent) or Tcf (trillion cubic feet). Mcf is the conventional way to measure natural gas in the United States, which uses the imperial measuring system. In Europe, where the metric system is used, the abbreviation most commonly used is thousand of cubic meters or Mcm. Oil and gas financial analysts need to be especially careful when analyzing companies' quarterly results to avoid mixing up various units. For example, it is quite easy to overlook the fact that U.S. companies will report in Mcf, while European companies often report in Mcm. This makes quite a difference because 1Mcm = 35.3Mcf.

Most of the major international oil and gas companies have standardized reports to help analysts and investors accurately assess these figures. This is partly a regulatory requirement with the U.S. Securities and Exchange Commission (SEC) requiring foreign companies with stock listed on U.S. exchanges to file standardized reports on an annual basis, called a 20-F. This is equivalent to the 10-K filing for U.S. companies and provides investors with oil and gas production and reserve statistics published using imperial measurements to allow direct comparison. Investors in emerging markets of Russia, Africa or Latin America often receive reports with data reported with the metric system, which is a global measurement system. Analysts of these companies will need to use conversion tables to accurately quantify and compare them to more sophisticated international operators.