Abstract
Advances in information technologies have pushed key E&P decision-makers to process greater amounts of data and information before making important capital investment decisions. The corporate planner is faced with an increasingly difficult task as the number of opportunities and the data associated with them has grown exponentially. The capital investment decision process demands greater speed and efficiency than ever before. Traditional capital investment planning and acquisition/divestiture work involved sorting through physical data rooms of seismic, production and economic data stored in a variety of paper copy and digital formats. The introduction of affordable high-bandwidth networks and fast data processors has allowed on-line data rooms, powered by application service providers (ASP) and web portals, to bring petroleum acquisition and divestiture to the desktop computer. Corporate and financial planners are able to employ increasingly advanced database and decision analysis software solutions to vastly improve the quality control and the speed of the investment decision process. Integrated software for real-time reservoir modeling, precise economic calculations and efficient portfolio optimization of diverse sets of exploration and production opportunities has become a reality.
This paper will review the evolution of the capital investment decision process from the traditional corporate planning workflow to the latest application of software dedicated to reservoir data processing and economic analysis of world petroleum fiscal regimes. The ability to apply portfolio management techniques using sophisticated mathematical search and optimization algorithms to greatly increase the efficiency of the planning process will be explored. This paper will discuss the key success factors associated with the capital investment decision-making process in the E&P industry and will use a personal computer to analyze a set of oil and gas assets on-line in the context of choosing an optimal corporate portfolio.
