Hi guys,
I'm doing a comp and i'm wondering how I can calculate the percent of the reserve liquids?
Is reserve liquids = proved reserve NGL? or is it NGL + gas / oil
Also did i calculate this R/P ratio correctly?
Proved Reserves = 100 MMBOE Daily Production = 20,000 Boe/d
= 100,000,000 / ( 20,000 * 365 ) = 13.7 years
thanks in advance
.
It depends on how you are quantifying your gas reserves. If you are assuming total gross gas, then no, you do not include your NGL reserves. But if you are assuming a total gross SHRUNK gas, then yes, you can include your NGL reserves.
If you give somebody a reserves number that is made up of oil, gross pre-shrunk (pre ngl processing) gas and ngls...you would basically be inflating your total reserve number.
Another question for Oil & Gas bankers (mature vs young oil/gas reserves) (Originally Posted: 10/08/2014)
Can anyone suggest what set of indicators one should use to assess the following:
The maturity of the upstream firm's oil & gas reserves: is it trend of production of BOEPD over time? years of production remaining (implied by current P1 reserves and latest production figures)? Some times, I see firms with sizable resource base of proven reserves (29-32 yrs of production left) but with annual output over years that hardly grows (or even declines)? How can I distinguish between one upstream company having mature/exhausted resource base and the other one having "young" assets with high output Growth potential? Are there any industry metrics/benchmarks to make such conclusions?
The remaining potential of upstream firm's existing resource base for future exploration - ?proven reserves as % of 3P? - I am trying to assess potential Growth in Proven reserves w/o the firm having to purchase new assets or do M&A. When examining independent reserve reports (by the likes of Miller & Lents), are there any indicators I should be looking at to assess the quality of probable and possible reserves?
As usual, I would be extremely grateful for any informed advice and suggestions.
Regards,
How do I shrink gas?
shrink is the term for the % of gas you lose through processing out NGLs from your gas. It can vary depending on reservoirs.
Example - you have 1 BCF of total gross gas. However, your NGL yield shrink is equivalent to 20%. Using this, you then have 0.8 BCF of gross gas and 0.2 BCF of NGLs. If you have a yield of 100,000 BBL of NGL per BCF, you then have 20,000 BBLS of NGL reserves.
PNGE is correct. In order to transport gas, you must first process your gas stream to fit pipeline specs (most gas is transported via pipe). Separating the liquids (and stripping out other impurities) will cause your gas stream to shrink, leaving you with (for ease of conversation) methane in one hand and NGL's in the other... Scientifically its a bit above my head but the actual shrinkage of the gas stream is a function of the heating content (BTU'S) of the hydrocarbons being processed.
Search GPM for another helpful measure of NGL content in gas stream.
The situation you described in the first question (large reserve base, declining/flat production) would indicate that the assets are mature. Production grows as more and more wells are drilled, but once a company's acreage has been drilled up and there are few/no wells left to drill, there will be a lot of PDP reserves and declining production. A younger asset base would be growing production as the acreage is drilled and proved reserves are added. Wells last as long as 40 years, so even if you have completely drilled up all of your acreage, you will still have production for years to come.
The only real way to tell how mature a company's asset base is is to look at how much acreage they have and how many drilling locations they have left. Sometimes this info is disclosed in earnings calls or presentations but a lot of the time it will be a judgement call.
thanks guys, really appreciate it!
Oil and Gas reserve information (Originally Posted: 02/27/2014)
I am currently looking at an O&G clients reserve report and FAS 69 disclosure information and trying to determine the key facts contained within. Does anyone have a good bit of experience in this area and have a routine for deciphering all of the information contained within these reports? I know the basics of the reserves, but wanted to get some more info from people who have experience in this area.
Well you've got proven, probable (50% chance) and possible (10% chance) reserves. PUDs (Proved undeveloped reserves) I suggest you refer to other WSO threads on E&P modeling questions -Do a search.
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