Property Evaluations

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Estimating reserves and projecting future cash flow provides the basis for strategic planning, which is necessary for the growth and long term development of our clients’ business concern.  Wright & Company, Inc. employs generally accepted industry methods in all projections, estimates, and analyses.

Unbiased audits and opinions on both in-house and third-party consultant’s estimates of reserves and economics.

Audits and Reasonableness Reviews

As companies become more sophisticated and integrate more software-based petroleum evaluation programs into their daily decision-making, Wright & Company, Inc. has increasingly been retained to audit and offer an unbiased opinion as to the reasonableness of a company’s in-house projections of reserves and economics.
Our technical staff excels at converting databases and working with many different programs and computer systems to help streamline the data transfer and provide the peace of mind sought especially by funding companies. We will review both in-house and third-party estimates of reserves and economics, and offer opinions to be used as a basis for various transactions.

The most often requested areas of review are:

  • Oil and Gas Reserves
  • Economic Parameters, to include:

– Working and Revenue Interests

– Operating Expenses

– Oil and Gas Pricing

– State and Local Taxes

– Capital Expenditures

– Salvage and Abandonment Costs

Providing Formation Evaluation, Reservoir Simulation, Enhanced Recovery, Workovers, and Well Testing.

Reservoir Analysis

As companies become more sophisticated and integrate more software-based petroleum evaluation programs into their daily decision-making, Wright & Company, Inc. has increasingly been retained to audit and offer an unbiased opinion as to the reasonableness of a company’s in-house projections of reserves and economics.
Our technical assistants excel at converting databases and working with many different programs and computer systems to help streamline the data transfer and provide the peace of mind sought especially by funding companies. We will review both in-house and third-party estimates of reserves and economics, and offer opinions to be used as a basis for various transactions.

The most often requested areas of review are:

    • Oil and Gas Reserves
    • Economic Parameters, to include:

Working and Revenue Interests

Operating Expenses

Oil and Gas Pricing

State and Local Taxes

Capital Expenditures

Salvage and Abandonment Costs

Volumetric Calculations and Performance Analyses to include Decline Analysis, Ratio Trends, and many others.

Estimating Reserves

In the early life of an oil or gas reservoir when there is little or no production data, the estimates of reserves are generally obtained by volumetric calculations, which require a knowledge of the size of and the properties included in the reservoir. The properties of the reservoir are predominantly measured by various logs run in the wellbores.

We offer:

      • Detailed log analysis in all major producing areas.
      • Ability to use computer programs developed in-house to provide accurate calculations of parameters.

If the reservoir has been producing, performance analyses may be applied. Whenever possible, or when required, Wright and Company, Inc. will utilize one or more estimation methods to obtain a consistent result. In addition, comparisons with offset data are used to verify the results and determine if they are analogous with other fields in the area. Reserves estimation methods include:

      • Decline Curve Extrapolation
      • P/Z Curves
      • Ratio Plots
      • Analogy to other similar producing properties
      • Material Balance Calculations, including the Numerical Simulator

Expected future production and sales of oil, gas, and any associated byproducts; Estimates of either monthly or yearly net revenues expected to be received from those sales.

Forecasting Cash Flow

Wright & Company, Inc.’s formal reports contain a projection of the expected future production and sales of oil, gas and any associated byproducts and estimates of either monthly or yearly net revenues expected to be received from those sales. These forecasts may include income adjustments from: ad valorem and severance taxes, lease operating expenses, capital costs required for the drilling of new wells, workovers, and the installation of surface facilities. Special considerations may also be included for various escalations, interest reversions, partnership splits and payout calculations.

The two main programs we utilize for economic forecasting are OGRE (Oil and Gas Reserves Evaluation System), developed by DPC&A, Dallas, TX and ARIES- the integrated Production, Reserves, and Economic Evaluation System from Landmark. We can run these programs based upon your existing database or we can create a database from your raw data.