MMCF is an abbreviation for a unit frequently used in the oil and gas industry, particularly for natural gas. It’s common in the US, where the imperial system is the standard, unlike most of the world, where the metric system is common.
You may find this unit in legal documents, financial reports, and research papers regarding natural gas reserves and production. In this article, we’ll talk about MMCF, how it’s derived, where it’s used, and list some of its equivalents in other units.
What is MMCF?
MMCF stands for million cubic feet (cu ft. or ft3). It’s derived from the standard unit of natural gas volume, MCF, or thousand cubic feet.
Cubic foot, in general, is a unit of volume in the imperial system. One cubic foot represents volume equal to a cube with one-foot sides. It’s calculated by multiplying the three sides measured in the foot (ft x ft x ft).
As natural gas is in a gaseous state, measuring it in other volume units like gallons, liters, or even the ubiquitous unit for crude oil, barrels (BBL), is hard. On the other hand, cubic feet is more viable to measure natural gas. One cubic foot of natural gas occupies the space equal to a cube of one-foot sides.
While cubic foot is the basic unit, MCF and MMCF are more commonly used in the gas industry. One possible reason for using these bigger units is that there are vast reserves of natural gas. Therefore, using a bigger unit reduces the digits and makes it easier to calculate and report numbers.
For instance, a gas well that produces 500,000 cubic feet of natural gas daily can be represented by 500 MCF or 0.5 MMCF.
Understanding the Abbreviation
There’s a misconception that the M in MCF stands for million. The M stands for millia, which is thousand in Latin.
Derived from MCF, the MM in MMCF means million (millia x millia or thousand x thousand). The MM is also the roman representation of one million. Of course, the CF in MCF and MMCF simply stands for cubic feet.
MMCF is an imperial unit, so it’s commonly used by gas companies operating in the US, international companies, or countries that trade with the US. It is also the unit stock exchange-listed gas companies use in the US to report their production and earnings.
Investors, analysts, and government agencies must be wary of the units in reports. MCF and MMCF are not standard units worldwide, so they need to be converted into appropriate units for parties outside the US. Conversely, companies reporting their production in metric units must convert their reports to units based on MCF when reporting them in the US.
For investors and royalty receivers, it’s incredibly important to note the units used so they understand the extent of production. Confusion about the units can lead to a wrong assessment of production and, thereby, the company’s revenue.
It’s important to note that many companies also use the unit MMCFE, which stands for million cubic feet of gas equivalent. This unit is similar to MMCF, except it conveys the energy equivalent of MMCF. In other words, it measures the energy a certain MMCF of natural gas can produce.
MMCFE, in contrast with MMCF, conveys are more profound estimate of the value of natural gas. For investors and analysts, the energy equivalent may be more useful and relevant than simply a number representing the volume of gas produced.
In Europe and many other parts of the world, the standard unit for measuring natural gas reserves and production is MCM (thousand cubic meters). MCM is a relatively big unit than MCF, as one meter is more than three times a foot.
One MCM is equal to 35.3 MCF.
The counterpart of MMCF in the metric system is MMCM (million cubic meters). However, it’s not that common as most companies simply use MCM.
So how much is one MMCF in MCM? One MMCF is approximately 2,831 MCM or 28,316 m3.
Another unit common in the oil and gas industry is the British Thermal Unit (BTU). BTU is a unit of heat defined as the amount of heat to raise the temperature of one pound of water by one degree Fahrenheit at sea level.
1 MCF = 1,000,000 BTU or 1 MMBTU (million BTU)
1 MMCF = 1,000,000,000 or 1,000 MMBTU or 1 BBTU (billion BTU)
In other words, one MCF of natural gas can produce heat of a million BTUs, and one MMCF of natural gas can produce heat of a billion BTUs.
Here are some other conversions:
1 MMCF = 190 BOE, where BOE is a barrel of oil equivalent, which represents the amount of energy in a barrel of crude oil.
1 MMCF = 25 TOE, where TOE is tons of oil equivalent, which represents the amount of energy produced by burning a ton of crude oil (ton is used for measuring crude oil in the metric system).
MMCF, or million cubic feet, is the volumetric unit for natural gas, where the MM stands for million and CF stands for cubic feet. It comes from MCF, the standard unit of volume for natural gas and similar hydrocarbons in the US gas industry. MCF, in turn, is derived from cubic feet.
The unit’s counterpart in the metric system would be million cubic meters or MMCM. As the exact numbers can vary in different measuring systems, it’s important to recognize which system is used in a particular instance.
Companies reporting in MCF or MMCF may provide conversions in the metric system units. They also use energy units to present gas production or remaining reserves.