Economic Analysis Example

Run a quick and easy economic report of an oil lease or gas well using the Economic Analysis.  The functionality exists to calculate the decline curve of a well below the standard Production Graph accessed by picking a production point on a map or by clicking gas or oil production links on the well or lease hub page.

 

(Also See Economic Analysis Help and Economic Analysis FAQ)

 

 

  1. First, click BEGIN POINT SELECTION

 

  1. Then, CLICK ON A FIRST POINT ON THE CHART ON THE LINEAR PORTION OF THE CURVE. (NOTE-Currently, we support exponential decline, which is commonly found in solution gas or gas cap expansion reservoirs, and is recognized by appearing as a sloping line on these graphs instead of a curve.  Some reservoirs with early "curve" production will stabilize to exponential decline later. This method is not recommended for water drive reservoirs, which produce a similar rate until "catastrophic" failure.)

 

  1. Click ON A SECOND POINT LATER IN TIME ALONG THE LINE.

 

  1. The CALCULATED DECLINE RATE SHOULD THEN APPEAR ON YOUR Decline Curve CALCULATOR. See Decline Curve Analysis Help

 

 

  1. You MAY OVERWRITE THESE RESULTS BY CLICKING "BEGIN POINT SELECTION" AGAIN.  (NOTE- doing several to see the variance in decline rates between points is helpful.  You want to match the line as closely as possible)

 

  1. CLICK "START ECONOMIC ANALYSIS"; ANOTHER PAGE WILL POP UP.  

 

IN EXAMPLE 1, WE WILL CALCULATE WORKING INTEREST.

   

 

The page below is what is automatically generated:

 

 

After filling it out for WI, it looks like this:

 

  1. CLICK "SUBMIT" YOUR WELL OR LEASE ECONOMICS REPORT WILL POP-UP.

  1. To Calculate a WI and RI Combined, the input chart would look like this… (RI filled in and “Add royalty interest to NRI” button underneath).

 

  1. To calculate Royalty Only, make sure the WI and NRI is filled out, include your royalty interest, and make sure to click on “Calculate Royalty Value Only”.