Economics module

The module is designed to assess the economic value of any exploration or field development project, including individual or multiple reservoirs, projects, clusters, etc. To date, it is the first fully probabilistic calculation tool for oil and gas economics.

The process of assessing the project's value here is based on two key principles:

Flexibility. Input data can be modeled within the system or imported from any external source. All calculation parameters can be defined as fixed values (deterministic) or expressed within probabilistic ranges (stochastic), depending on the user's choice.

Transparency of the process for quick verification of any parameters and results. All input data, intermediate, and final calculations are clearly displayed on graphs and tables for analysis and validation. They can also be downloaded at any time for review and verification using alternative calculations.

The workflow

The production data, along with the drilling schedule, comes directly from the Production module or can be imported by the user from any other source
Project macroparameters (inflation, currency exchange, or discount rates, etc.) can be set manually or downloaded based on corporate rules and requirements. Product prices can optionally be defined using external sources (like Bloomberg consensus or others)
Flexible CAPEX: Users can create and modify various capital investment items like wells, surface facilities, transport systems, or any other type of infrastructure elements.
Flexible OPEX: Users can define and modify any type of expenses, as well as set cost dependencies to the relevant parameters
The fiscal modeling is implemented through a customizable tax compilation system. This allows for easy customization of various taxes, tax regimes, and tax environments, making it possible to apply the economic model to any country worldwide
Economic results for different projects or alternative scenarios can be compared using specially designed flexible and adaptive tables and graphs.

Calculation results

The final result is displayed on a customizable dashboard, showing statistical distributions and possible ranges for key economic parameters such as NPV, EMV, IRR, PI and selected cashflows

The results demonstration dashboard introduces new features for visualizing probabilities: Probabilistic Cashflow Plot, Project Value "Thermometer"

Analytics: Sensitivity analysis

A comprehensive linkage of all calculation elements and parameters (ranging from Geology to Economics) enables the assessment of their relative impact on project value. The results can be visualized using: 1) a Tornado Chart, and 2) a Spider Plot

Analytics: Value chains analysis

The dynamic linkage of all calculation elements enables interactive visualization of the direct influence of variable parameters (e.g., thickness, porosity, start rate, lift cost, etc.) on the project's monetary value. For the first time, users can instantly observe changes in NPV as they modify selected properties or economic factors.

In a real project, we can directly measure the monetary impact of selected variables in Geology, Engineering, or Economics on NPV (or other economic indicators).

In this case, we analyze the following factors: 1. Oil price, 2. Well start rate, 3. Oil-water contact depth, and 4. Porosity

Framework for decision making

Final results include quantified and probabilistic estimates of:

Reserves and resources volumes

Production forecasts

Economic parameters

Key Uncertainties (and their influence on project)

Key risks (and their potential consequences to the project)

Basis for:

Testing business ideas and hypotheses
Rapid screening for new opportunities or investment options
Fast ranking of fields, prospects or leads within companies' project portfolio
Alternative check/verification of previous (or alternative) evaluations

Decision makers get:

A comprehensive basis for identifying and selecting attractive investment opportunities.
Indicators and early warnings about potentially risky projects or situations.
An understanding of the possible variations in asset (or project) value.