Tuesday, September 18, 2012
Valuing Eagle Ford Oil and Gas Assets
What is the value of the oil under your land in the Eagle Ford? It turns out that it’s not that difficult to learn the answer to that question by doing a little online research and putting that knowledge to work. With the enormous values being paid today between operators for undeveloped acreage in the Eagle Ford it’s the duty of us landowners to understand what we own. To do otherwise is dereliction. I see it as our sacred duty to protect our families by making them aware and passing on important information regarding the value of our land. Whether leased or not, you can get a better understanding of what you own by starting with the articles I have hyperlinked below.
Valuing Oil and Gas Assets In The Courtroom
VALUING PUD RESERVES: A PRACTICAL APPLICATION OF REAL OPTION TECHNIQUES
Try to become familiar with the different types of oil and gas assets by learning the following key definitions.
Prospect. A specific geographic area which, based on supporting geological, geophysical or other data and also preliminary economic analysis using reasonably anticipated prices and costs, is deemed to have potential for the discovery of commercial hydrocarbons.
Proved developed reserves (PDP). Reserves that can be expected to be recovered through existing wells with existing equipment and operating methods.
Proved reserves. The estimated quantities of oil, natural gas and natural gas liquids which geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions.
Proved undeveloped reserves. (PUD). Reserves that are expected to be recovered from new wells on undrilled acreage or from existing wells where a relatively major expenditure is required for recompletion.