Overview
Prospect valuations utilize Wood Mackenzie's subsurface and upstream data, knowledge, and experience to build discounted cash flow models for each mature prospect with estimated resource greater than 20 mmboe.
Methodology framework
The modelling approach comprises five interconnected components:
1. Production profile
Input parameters: estimated prospect resource size, gas/liquids content, and water depth
Data source: Wood Mackenzie’s subsurface data and regional knowledge
Methodology: generate production curves based on prospect characteristics
Output: tailored production profiles for each prospect
2. Well numbers
Input parameters: prospect resource size and subsurface characteristics
Data source: Wood Mackenzie’s subsurface understanding and regional analogues
Methodology: calculate EUR (estimated ultimate recovery) per well
Output: total number of wells required to produce estimated prospect resource
3. Development solution
Input parameters: prospect resource size, water depth, location, and gas/liquids content
Data source: Wood Mackenzie’s knowledge of regional development practices and infrastructure mapping
Methodology: select optimal development solution based on technical and economic factors
Output: recommended development approach from available options:
Subsea tieback - typically close to existing infrastructure
Platform development – typically in shallow water
FPSO (varying sizes) – typically in remote deep water
Semi-submersible – typically in remote deep water
4. Capital expenditure and phasing
Input parameters: selected development solution and prospect specifications
Data source: Wood Mackenzie's proprietary upstream costs database
Methodology: determine capital expenditure and development schedules
Output: cost estimates and timelines for:
Drilling
Facilities
Subsea infrastructure
Pipelines
Abandonment
5. Operating costs
Input parameters: development solution and regional location
Data source: Wood Mackenzie’s understanding of regional analogues and operational benchmarks
Methodology: apply regional cost profiles to prospect-specific parameters
Output: operating cost profile for prospect lifecycle
Note: Regional variations and hydrocarbon type can significantly influence development solution selection and associated costs.
Prospect emissions
Greenhouse gas emissions associated with the development and production of oil and gas (upstream operations) are directly related to the nature of the fields from which they are produced, and the type of activities involved in the production and processing of the associated hydrocarbons.
Prospect emissions profiles have been derived using a methodology that integrates Wood Mackenzie’s extensive upstream data, empirical information regarding upstream emissions intensities from the public domain, and inputs to and published outputs from the OPGEE model.
The approach focuses on the stages of the upstream value chain that account for the bulk of greenhouse gas emissions: drilling, production, processing, flaring, venting and methane.
At this early stage in the potential field development life cycle, our model uses regional estimates and local analogues to fill data gaps. Processing emissions, for example, are driven largely by hydrocarbon properties that can only be verified once a prospect is successfully drilled and tested.
Please see the “Upstream Emissions Methodology” section for more detail on how emissions profiles for upstream assets are generated.