DISCUSSION: SOFTWARE AS AN ASSET ACCURATE AND STABLE PRODUCTION FORECASTS: A DATA POINT YOU SHOULDNT IGNORE Heidi Anderson Kuzma, PhD CTO, BetaZi LLC Janette Conradson CEO, BetaZi LLC
Proved Production Forecasts 2 BetaZi does two things: 1. Forecasts production from existing wells 2. Builds and tests type curves There are two reasons you need to do this: 1. To know the value of future proved production 2. To…
Why Forecasting is Hard 3 Ad hoc math behind decline analysis is inherently unstable. 1. Overly sensitive to noisy data 2. Confused by multiple stages and flow regimes 3. Must be adjusted by hand 4. Leads to complicated…
Who do you trust 4 Different choices can have radically different outcomes Forecast 1 Forecast 2 EUR = 112,959 BBL oil EUR = 787,822 BBL oil Lifetime = 16 years Lifetime = 386 years Copyright BetaZi, LLC 8/16/2015 MENU
A stable and accurate forecast 5 A physics-based predictive analytics solution that computes unbiased, accurate, automatic production forecasts with calibrated uncertainty. INPUTS: oil, gas, water, OUTPUTS: forecast with…
North Dakota Past Production 6 14,300 active wells in North Dakota What would happen if drilling stopped (1/2000 4/2016) Copyright BetaZi, LLC 8/16/2015 MENU
North Dakota Future Production 7 The future of production in North Dakota if drilling stops. (1/2000 12/2029) Copyright BetaZi, LLC 8/16/2015 MENU
Why Might Drilling Stop 8 Run out of locations Environmental policy Price crash Capital crisis - Banks stop lending - Private equity gets scared (It has stopped) Rig count Sept 2014: 199 Rig count now: 29 Copyright…
Map comprises 13,017 Forecasts 9 Copyright BetaZi, LLC 8/16/2015 MENU
Forecast 10 INPUTS: oil, gas, water, monthly OUTPUTS: forecast with volumes and working days calibrated uncertainty p10 p50 p90 Uncertainty = (p10 p90)/p50 Monthly production is forecast to exceed p50 50% of the…
All wells handled automatically 11 Copyright BetaZi, LLC 8/16/2015 MENU
Verification by holdback testing 12 Used to make forecast Used for testing Copyright BetaZi, LLC 8/16/2015 MENU
Quantile-Quantile testing 13 (Slightly conservative for oil exact for gas) Copyright BetaZi, LLC 8/16/2015 MENU
Movie Again 14 The future of production in North Dakota if drilling stops. (1/2000 12/2029) Copyright BetaZi, LLC 8/16/2015 MENU
Half Life = 4 years (p50) 15 Peak: Dec 2014 bbl June 2016 30.8 M BBL (exactly as predicted) Half in Dec 2021 Half: Jan 2019 Quarter: Feb 2030 Copyright BetaZi, LLC 8/16/2015 MENU
Decline seems slow 16 50% decline over 48 months is equivalent to a 1.4% monthly drop. Between Dec 2014 and June 26, half-life predicts we should be at 77% of Dec 2014 production. Actually, we are at 82% (but there has been…
Company A 17 Copyright BetaZi, LLC 8/16/2015 MENU
Company A: Half Life 1.5 years 18 Peak: July 2014 Half: Jan 2016 Quarter: May 2020 Copyright BetaZi, LLC 8/16/2015 MENU
Company 2: Half Life = 6.4 years 19 Peak: Dec 2014 Half: May 2021 Quarter: Not reached Copyright BetaZi, LLC 8/16/2015 MENU
Type Curve: Company A 20 Copyright BetaZi, LLC 8/16/2015 MENU
Type Curve: Company B 21 Copyright BetaZi, LLC 8/16/2015 MENU
Strategy I 22 Continued low prices High discount rate No need for cash Both wells produce 1 M BBL over 7 years. Copyright BetaZi, LLC 8/16/2015 MENU
Strategy II 23 Slow price rise Low Discount Rate Need 400k/mo Both wells produce 1 M BBL over 7 years. Copyright BetaZi, LLC 8/16/2015 MENU
Enable yourself 24 Accurate forecasts and type curves are a data point you need to make good decisions.. Copyright BetaZi, LLC 8/16/2015 MENU
Thank You 25 Janette Conradson, CEO jConradsonbetazi.com 530.308.9074 Heidi Anderson Kuzma, PhD CTO/Chief Innovation Officer 816 Congress Avenue Suite 1200 Austin, TX, 78701 11209 Brockway Road Suite 302 Truckee, CA…
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