Alta Mesa - UGM 2014

Alta Mesa Holdings, LP
Example:
Acquisition Evaluation of
Conventional Stacked Play
November 18, 2014
Confidential
Goals and Challenges
Evaluate multiple scenarios quickly for an
acquisition evaluation.
Economic results.
Conventional pays:
– Type curve vs. Volumetric Estimate.
– Or, maybe BOTH.
Model recompletion program.
– Include dual completions.
– Include through tubing recompletions.
– Include single completions.
Shotgun Opportunity Summary
 Shotgun field
– Conventional stacked oil
pay
– 4 producing wells:
•
•
•
•
Remington
Weatherby
Beretta
Ithaca
– Ten idle wellbores and
abandonment liability
– Salt Water Disposal
– Facility with gas lift
capability
 Opportunity
– Current production
– Identified behind pipe:
• Benelli (4 zones)
• Browning (2 zones)
• Beretta (10 zones)
– Potential additional
locations to be identified
with 3D seismic
 Challenges:
– Model zone variety.
– Should wells be
twinned?
– Development options.
Example Log
Evaluation Summary
1) 2Twins: 30%
Probability of
Occurrence
– Currently identified with
2 twins of Beretta
– Seismic upside:
expected prospect count
and success.
2) High: 25%
Probability of
Occurrence
– Currently identified with
2 twins of Beretta
– Seismic upside: High
prospect count and
success.
3) 1 twin: 30%
Probability of
Occurrence
– Currently identified with
1 twin of Beretta
– Seismic upside:
expected prospect count
and success
4) Low: 15% Probability
of Occurrence
– Currently identified with
no twins.
– Seismic upside: no
prospects found.
Volumetric Results: Zone by Zone
Well List
Well Name
Top Bottom
EUR, Oil mbbl GOR, mcf/bbl
Benelli 2
4734
4750
21.7
9.313841037
Benelli 1 SS
5424
5440
21.2
9.435991075
Benelli 1 LS
7994
8113
64.5
7.255664416
Benelli 3
1366
2748
5
1
Browning SS
2158
2240
11.5
1
Browning LS
3829
4162
39.7
0.6
Beretta Twin Shallow3
1204
1283
10.9
1.417
Beretta Twin Shallow2
1912
1948
35
0.619898236
Beretta Twin Shallow1
2254
2311
17.8
1.092688136
Beretta 2 SS Sleeve
3166
3180
50
2
Beretta 2 SS
3550
3604
8.4
1.417
Beretta 2 LS
3935
4015
62.5
1.019504768
Beretta Sleeve
4812
4864
44.5
1.004647157
Beretta Twin Deep RC
978
1006
20.6
0.6
Beretta Twin Deep LS
5356
5416
75
2
Beretta Twin Deep SS
5146
5270
100
2
Beretta
4915
4961
User Data
Conventional Type Curve
Performance trend type curve:




Initial production flat for 3 months
2nd 3 months decline @ 65%
3rd segment declines exponentially to EUR
Water hit at 6 months: ramp from 0.05 bbl/bbl
to 20 bbl/bbl
 Functions in type curve reference user data
for EUR, IP, and GOR
 =@Scalar('EUR, Oil mbbl')
 =@Scalar('EUR, Oil mbbl')*.004
 = @Scalar('GOR, mcf/bbl')
Scheduler Set-up
 “Wait for:” is the function that controls
completion order.
 Multiple triggers available. Oil rate used in this
model.
Recompletion Program Design
Well List
Completion
Name
Controls
Order
Wellbore
Group
User Data
Vary Costs and Time, Group Operations,
Control Timing
EUR,
Step 1 Step 1 Start
Step 1
Step 1 By Step 1 Step 2 Step 2 Start
Step 2
Oil
GOR,
Is
Date
Duration Step
Fixed Is
Date
Duration
Well Name
Well Count Template
Flows
Name
To
Wait For Task APITop
Number
Bottom mbbl mcf/bbl
RSV_CAT Active (mm/dd/yyyy) (Days)
Group
Costs1 Active (mm/dd/yyyy) (Days)
Beretta Twin
Beretta Twin Shallow3
1 Recompletion
Beretta (Single)
Well Shallow2
17-000-00000-00
1204
1283
10.9
1.417 3PUD
400
Beretta Twin
Beretta Twin Shallow2
1 Recompletion
Beretta (Single)
Well Shallow1
17-000-00000-00
1912
1948
35 0.61989824 3PUD
400
Beretta Twin Shallow1
1 Recompletion
Beretta (Single)
Well
17-000-00000-00
2254
2311
17.8 1.09268814 3PUD
1600
Beretta 2 SS Sleeve
1 Recompletion
Beretta (Single)
Well Beretta 2 SS
17-000-00000-00
3166
3180
50
2 2PDNP
200
Beretta
Beretta 2 SS
1 Recompletion
Beretta (Single)
Well Beretta Sleeve 17-000-00000-00
3550
3604
8.4
1.417 2PDNP
RC
600
Beretta
Beretta 2 LS
1 Recompletion
Beretta (Single)
Well Beretta Sleeve 17-000-00000-00
3935
4015
62.5 1.01950477 2PDNP
RC
600
Beretta Sleeve
1 Recompletion
Beretta (Single)
Well
17-000-00000-00
4812
4864
44.5 1.00464716 2PDNP
75
Beretta Twin
Beretta Twin Deep RC
1 Recompletion
Beretta (Single)
Well Deep SS
17-000-00000-00
978
1006
20.6
0.6 3PUD
300
Beretta
Beretta Twin Deep LS
1 Recompletion
Beretta (Single)
Well
17-000-00000-00
5356
5416
75
2 3PUD
12 Twin
1750
Beretta
Beretta Twin Deep SS
1 Recompletion
Beretta (Single)
Well
17-000-00000-00
5146
5270
100
2 3PUD
12 Twin
1750
Beretta
-1 BerettaBeretta Well
17-000-00000-00
4915
4961
1PDP
n
n
Benelli 2
1 Recompletion
Benelli Well
(Single) Benelli 1 LS
17-000-00000-00
4734
4750
21.7 9.31384104 2PDNP
700
Benelli 1 SS
1 Recompletion
Benelli Well
(Single)
17-000-00000-00
5424
5440
21.2 9.43599108 2PDNP
Benelli 1
600
Benelli 1 LS
1 Recompletion
Benelli Well
(Single)
17-000-00000-00
7994
8113
64.5 7.25566442 2PDNP
Benelli 1
600
Benelli 3
1 Recompletion
Benelli Well
(Single) Benelli 2
17-000-00000-00
1366
2748
5
1 2PDNP
200
Browning SS
1 Recompletion
Browning
(Single)
Well
17-000-00000-00
2158
2240
11.5
1 2PDNP
Brownin
500
Browning LS
1 Recompletion
Browning
(Single)
Well
17-000-00000-00
3829
4162
39.7
0.6 2PDNP
Brownin
500
Producing well included with Well Count: -1
Step 2 By Step 2
Step
Fixed
Group
Costs1
TTRC
Beretta RC
Beretta RC
Beretta
Twin
Beretta
Twin
Beretta
Benelli 1
Benelli 1
Browning
Browning
70
Recompletion Program Results
Activity Summary
Project: Shotgun Stacked Pay
Scenario: Filtered Results
10/24/2014 10:26
Activity Information
Asset Name
Asset
Reserve Category Prop_ID Spud Date (Start)
TD (End)
Frac Start Frac End
On Prod
Benel l i 1 LS,7994-8113
Benel l i 1 LS,7994-8113
2PDNP
3/18/2015
3/24/2015 No Da ta No Da ta 3/25/2015
Benel l i 1 SS,5424-5440
Benel l i 1 SS,5424-5440
2PDNP
3/11/2015
3/17/2015 No Da ta No Da ta 3/25/2015
Benel l i 2,4734-4750
Benel l i 2,4734-4750
2PDNP
1/1/2017
1/7/2017
No Da ta No Da ta
1/8/2017
Benel l i 3,1366-2748
Benel l i 3,1366-2748
2PDNP
7/1/2018
7/7/2018
No Da ta No Da ta
7/8/2018
Beretta 2 LS,3935-4015
Beretta 2 LS,3935-4015
2PDNP
10/8/2016
Beretta 2 SS Sl eeve,3166-3180
Beretta 2 SS Sl eeve,3166-3180
2PDNP
1/1/2018
1/7/2018
Beretta 2 SS,3550-3604
Beretta 2 SS,3550-3604
2PDNP
10/1/2016
10/7/2016 No Da ta No Da ta 10/15/2016
Beretta Sl eeve,4812-4864
Beretta Sl eeve,4812-4864
2PDNP
2/8/2015
2/14/2015 No Da ta No Da ta 2/15/2015
Beretta Twi n Deep LS,5356-5416
Beretta Twi n Deep LS,5356-5416
3PUD
2/15/2015
2/26/2015 No Da ta No Da ta 3/11/2015
Beretta Twi n Deep RC,978-1006
Beretta Twi n Deep RC,978-1006
3PUD
2/1/2017
2/7/2017
Beretta Twi n Deep SS,5146-5270
Beretta Twi n Deep SS,5146-5270
3PUD
2/27/2015
3/10/2015 No Da ta No Da ta 3/11/2015
Beretta Twi n Sha l l ow1,2254-2311
Beretta Twi n Sha l l ow1,2254-2311
3PUD
2/1/2015
2/7/2015
No Da ta No Da ta
2/8/2015
Beretta Twi n Sha l l ow2,1912-1948
Beretta Twi n Sha l l ow2,1912-1948
3PUD
7/1/2016
7/7/2016
No Da ta No Da ta
7/8/2016
Beretta Twi n Sha l l ow3,1204-1283
Beretta Twi n Sha l l ow3,1204-1283
3PUD
2/1/2018
2/7/2018
No Da ta No Da ta
2/8/2018
Browni ng LS,3829-4162
Browni ng LS,3829-4162
2PDNP
4/1/2015
4/7/2015
No Da ta No Da ta
4/8/2015
Browni ng SS,2158-2240
Browni ng SS,2158-2240
2PDNP
3/25/2015
3/31/2015 No Da ta No Da ta
4/8/2015
10/14/2016 No Da ta No Da ta 10/15/2016
No Da ta No Da ta
No Da ta No Da ta
1/8/2018
2/8/2017
Economic Results
BT Economic Summary
As Produced
10/24/2014 10:56
Reserves
Gross
ASSET:
Shotgun Stacked Pay
SCENARIO:
PROJECT:
Shotgun Stacked Pay
COMPANY: Alta Mesa Holdings
0%
10%
Wet Gas
8,548.51
4,274.26
3,668.17 mmcf
ASSET START DATE:
1-Jan-14
Dry Gas
8,548.51
4,274.26
3,668.17 mmcf
EVALUATION DATE:
1-Jan-14
Oil
2,836.51
1,418.25
1,216.99 mbbl
DISCOUNT DATE:
1-Nov-14
NGL
0
0
0 mbbl
RISK SETTING:
Base
MBOE
3,691.36
1,845.68
1,583.81 mbbl
Economic Indicators
20%
Gross
BT Cash
106,573.60
74,973.20
54,821.80 m$
Capital
66,068.50
57,084.00
50,220.40 m$
Before Tax
Company Interest
Disc. Profit Index (Cash Flow Multiple) Net F&D Cost
IRR
Payout
Initial
Average
Final
%
months
0%
10%
20%
$/BOE
WI Opcost (%)
50
50
50
207.92
21
2.61
2.31
2.09
20.86
WI Capital (%)
50
50
50
42.79
42.9
42.91
NRI BOE (%)
Production Rates
Oil
Gas
Production
Date
bbl/d
Production Volumes
NGL
Production Production
mcf/d
bbl/d
Net
Gross
NPV
Gross
WI
REPORT WI TYPE:
Realized Prices
BOE
Oil
Gas
NGL
BOE
Oil
Gas
NGL
Well
Working
Production
Production
Production
Production
Production
Price
Price
Price
Count
Interest
bbl
mcf
bbl
bbl
$/bbl
$/mcf
$/bbl
bbl/d
______
%
2014
134.3
320.1
0
187.7
49,025
116,850
0
68,500
93.5
2.17
0
4
50
2015
968.4
1,911.80
0
1,287.10
353,481
697,806
0
469,782
93.5
2.17
0
12
50
2016
1,631.80
2,898.10
0
2,114.80
597,228
1,060,723
0
774,015
93.5
2.17
0
15
50
2017
2,209.60
4,030.90
0
2,881.40
806,487
1,471,283
0
1,051,701
93.5
2.17
0
15
50
2018
1,488.00
2,481.00
0
1,901.60
543,137
905,573
0
694,066
93.5
2.17
0
14
50
2019
663.7
1,194.70
0
862.9
242,262
436,073
0
314,941
93.5
2.17
0
10
50
2020
346.2
623.1
0
450
126,699
228,059
0
164,709
93.5
2.17
0
10
50
2021
180.5
324.9
0
234.7
65,888
118,598
0
85,654
93.5
2.17
0
10
50
2022
94.2
169.6
0
122.5
34,392
61,905
0
44,709
93.5
2.17
0
10
50
2023
49.1
88.3
0
63.8
17,910
32,238
0
23,283
93.5
2.17
0
10
50
2,836,510
5,129,107
0
3,691,361
Cash Flows
Date
Cumulative Cash Flows
Oil
Gas
NGL
Total
Total
Total
Operating
Total
BT
Cum Op
Cum
Cum BT
YOY Undisc.
Revenue
Revenue
Revenue
Revenue
Opcosts
Royalties
Income
Capital
Cash Flow
Income
Capital
Cash
Cash Growth
m$
m$
m$
m$
m$
m$
m$
m$
%
m$
m$
2014
4,583.88
422.03
0
5,005.91
m$
5,172.00
722.54
-1,424.05
0
-1,424.05
m$
-1,424.10
0
-1,424.10
-100
2015
33,050.47
2,520.27
0
35,570.74
6,598.47
5,055.25
20,102.58
16,655.00
3,447.58
18,678.50
16,655.00
2,023.50
-342.1
2016
55,840.81
3,831.01
0
59,671.82
7,692.73
8,465.45
37,112.84
35,805.00
1,307.84
55,791.40
52,460.00
3,331.40
-62.1
2017
75,406.54
5,313.84
0
80,720.37
8,528.20
11,447.31
52,085.72
11,960.00
40,125.72
107,877.10
64,420.00
43,457.10
2,968.10
2018
50,783.36
3,270.66
0
54,054.02
7,731.44
7,664.86
32,859.07
1,288.50
31,570.57
140,736.20
65,708.50
75,027.70
-21.3
2019
22,651.54
1,574.96
0
24,226.51
1,399.24
3,435.32
16,793.05
0
16,793.05
157,529.20
65,708.50
91,820.70
-46.8
2020
11,846.40
823.68
0
12,670.08
1,029.44
1,796.62
8,484.84
0
8,484.84
166,014.10
65,708.50
100,305.60
-49.5
2021
6,160.51
428.34
0
6,588.85
834.84
934.3
4,112.89
200
3,912.89
170,126.90
65,908.50
104,218.40
-53.9
2022
3,215.62
223.58
0
3,439.20
734.05
487.68
1,848.53
100
1,748.53
171,975.50
66,008.50
105,967.00
-55.3
2023
1,674.59
116.43
0
1,791.02
678.31
253.97
666.61
60
606.61
172,642.10
66,068.50
106,573.60
-65.3
265,213.71
18,524.81
0
283,738.52
40,398.74
40,263.29
172,642.08
66,068.50
106,573.58
Scenario Cash Flow and Capital Compare
Cumulative Cash Flow Compare
Production Compare
Sensitivity Tornado
Run
Label
Command
1 Base
Base
2 Price - Low
3 Price - High
Argument #1
MC Seed
ATNPV@ 0%
BTNPV@ 0%
Capital@ 0%
Opcost@ 0%
Oil Volume
Gas Volume
Seed
m$
m$
m$
m$
mbbl
mmcf
776950014
-4,358.70
-5,517.30
20,175.00
28,472.90
572.1
1,103.00
Risk:Price
0.8 1568750741
-11,173.30
-14,143.40
20,175.00
28,472.90
572.1
1,103.00
Risk:Price
1.2
400339575
2,456.00
3,108.80
20,175.00
28,472.90
572.1
1,103.00
4 RR - Low
Risk:RateAndReserves
0.8 1414866721
-10,537.00
-13,338.00
20,175.00
28,208.00
465.8
871.6
5 RR - High
Risk:RateAndReserves
1.2 1766238612
1,769.50
2,239.90
20,175.00
29,212.30
684.1
1,336.70
6 Cap - Low
Risk:CapitalAll
0.8 1787511411
-1,171.00
-1,482.30
16,140.00
28,472.90
572.1
1,103.00
7 Cap - High
Risk:CapitalAll
1.2 1738933133
-7,546.30
-9,552.30
24,210.00
28,472.90
572.1
1,103.00
8 Opcost - Low Risk:Opcost
0.8 1507048850
140.1
177.3
20,175.00
22,778.30
572.1
1,103.00
9 Opcost - High Risk:Opcost
1.2
-8,857.40
-11,211.90
20,175.00
34,167.50
572.1
1,103.00
432886744
Conclusions
 Able to evaluate multiple potential outcomes with
very little duplication of work.
 Scenarios and sensitivities could be created and
evaluated in a collaborative environment since
results and comparisons are within the tool.
 Determined that field that is currently negative
cash flow could be economic with some
exploitation. In addition, potential existed to grow
the field through 3D seismic evaluation.
 Bid was made and accepted for the asset, but
transaction has not yet closed.
 Methodology could also be used to plan and
manage a similar asset.
 The workflow will scale well into much larger
assets.