Every evaluation of an oil and gas interest that we conduct takes into account a multitude of factors. Some of these factors are:
Commodity Price Risk
Future Drilling Potential
Our evaluation process first starts with the historical production of the well (or wells). Our data base contains massive amounts of historical production data for wells from across the country. Every oil and gas well has a rate of decline that we analyze and extrapolate into the future using sophisticated oil & gas engineering. We also analyze the capacity of the reservoir to continue to produce for an extended period.
It is also important to point out that GRP will also give additional value in areas where there is potential for new wells that will add to current production.
Operator reputation is also very important to us. Many operators are more efficient and experienced than others, and can consistently produce stable results.
The risk of large commodity price swings is also taken into account in all of our evaluations.
How the process works:
A typical transaction happens like this:
- You provide us with information
- We provide an evaluation
- We both agree to an amount
- We fund the transaction within days of the agreement