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Case Studies

Rapid Support for Assessing a Steam Flood Farm-In Opportunity

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Middle East / 2017 / Strategic Advisory

Assessed a $500MM investment decision

Evaluated a potential farm-in opportunity in a large steam flooding operation

Involved 2.5 billion BBL of oil in place and 120,000 bopd plateau

Met the client’s tight timeline

Challenge

  • The client required independent technical advisory with respect to assessing a sizeable steam flood farm-in opportunity
  • With limited experience, the client wanted an experienced technical team to identify the risks and uncertainties (including reservoir behavior, data limitations and debottlenecking) inherent in a project of this nature, particularly with respect to the sustainability of the production plateau

Solution

  • Sproule provided a reservoir engineer with extensive steam flooding expertise and integrated the individual within the client’s business development team to assess the opportunity
  • Based on a short timeline, limited technical data (reports of static and dynamic studies), examples of similar projects and the past experience of the advisor, Sproule helped the team assess the operator’s forecast and determined them to be robust and representative of the base case. From that assessment, the team created low- and high-case production forecasts, which were not available in the data room
  • The low case was based on poor drilling results and unexpected operational problems, which was supported by the advisor’s own experience. The high case was based on better-than-expected drilling results and the advisor’s own experience that steam projects do not follow conventional decline curves

Value

  • Sproule’s very deep technical knowledge, thanks to experience with many steam flooding projects, enabled Sproule to provide a robust assessment of the low-, base- and high-case production forecasts
  • The analogies and references used as supporting evidence for assumptions and hypothesis add robustness to the estimations