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Benchmarking Investment Opportunities in Major Resource Plays

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Canada / 2016 / Capital Strategies

+$100 million investment decision

Insights based on thousands of hours of engineering and geology analysis

Informed investment decisions based on independent analysis

Using the right data cut the decision timeline by +50%

Challenge

  • Looking at deploying an investment of over $100 million, a hedge fund identified two resource plays as long-term investments
  • Several target companies in these plays were considered, but a direct comparison of future potential was challenging because:
    • The plays cover a very large aerial extent, with variable reservoir quality, multiple developable layers and changing fluid compositions
    • The companies used different drilling and completion techniques, making it difficult to benchmark
    • Techniques have changed over time due to technological advances

Solution

  • Sproule compared the developed and undeveloped land base of seven different companies using public data along with Sproule’s Type Curve Analysis database 
  • Drilling and completion techniques, cost structures and production profiles were compared for each company within each area
  • Economic key performance indicators by company and area were compared, and potential future drilling locations were identified

Value

  • The forecast results provided the client with the necessary analysis and insights to make an informed investment decision
  • By augmenting proprietary data with information from Sproule’s Type Curve Analysis database, the client was able to save significant time and cost