Gas Supply Study Supports Investment Decision
A client was considering investing in a company that provides natural gas compressors to an area supplied by Cardium and Spirit River natural gas. Before making this major investment decision they looked to third party experts in order to better understand the economic viability of future development in the area.
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Project Highlights
- Analysis helps manage long-term investment risk
- Identified potential in several formations
- Break-even analysis reduced uncertainty
- Forecasts support investment decision
Challenges:
A client was considering investing in a company that provides natural gas compressors to an area supplied by Cardium and Spirit River natural gas
The client required information regarding the economic viability of future development in the area before making a major investment decision
The client required information regarding the economic viability of future development in the area before making a major investment decision
Solutions:
Experts identified the undeveloped potential in each formation and estimated the production profiles for future wells
The economic viability, including break-even analysis, of future development was assessed
Using a base production forecast plus expected future drilling, Sproule ERCE created a forecast of the drilling activity required to keep the compressors operating at capacity
The forecast was then compared with historical drilling activity to provide insight as to the likelihood of this development pace being achieved
The economic viability, including break-even analysis, of future development was assessed
Using a base production forecast plus expected future drilling, Sproule ERCE created a forecast of the drilling activity required to keep the compressors operating at capacity
The forecast was then compared with historical drilling activity to provide insight as to the likelihood of this development pace being achieved
Values:
The supply study provided the client with the necessary analysis and insights to make a more informed investment decision
The client was able to compare the analysis of an independent third party to information provided by producers in the area, and was able to determine that there was enough future production potential to justify the investment
The client was able to compare the analysis of an independent third party to information provided by producers in the area, and was able to determine that there was enough future production potential to justify the investment