What is incremental valuations?
Incremental valuations allows you to compare different development scenarios for a particular asset allowing you to highlight which generate the most additional value.
What questions does it answer?
If I drill an additional well for $100M, does the incremental production add or destroy value from the overall project?
Is it worthwhile to build a pipeline to increase overall production capacity?
What the value of a child field if I build a tieback?
How to perform an incremental valuation
To perform an incremental valuation, simply select your asset(s) or country filters, navigate to the Valuations section, then click on "Edit Assumptions."
From there, enable the "Phase" toggle and click "Apply." In the economics header, you'll notice that the Valuation type has now been updated to "Phase."
💡 Tips:
Incremental valuation will not run when a company filter is applied.
When filtering to multiple assets, the incremental valuation will only run for those assets that have available phase data.
If your search results do not have available phase data, you will receive an message informing you to switch back to project valuation.
How will this be reflected in the charts and data tables?
When you work with Incremental Valuation, you will still be working with the same charts and data tables as in a Project Valuation, but the key difference is that now you will see the data both on a per-phase basis and in an accumulated form.
For example:
The phased asset summary will have a single row for each phase of the asset as well as the accumulative phases.
The Standard cash flow and PV tables shows individual phase data but can be switched to a different phase using the settings menu.
💡 Tip: Creating your own price assumptions are still available with the incremental valuation.
What's Next?
Now that you know how to perform an incremental valuation, you can also create your own custom price deck.