Shale asset property consolidation, fractional acquisition of proven properties, and outright company acquisitions generate a growing demand for technical-economic appraisal support. Proven concept plays, attractive to larger oil and gas companies and investment firms, often have large amounts of geology and geophysical data, but may have limited production histories in as many as 100 wells within the regional play. Acquirers must address data management needs, secureaccess to experienced shale professionals, and meet timeconstraints to review, interpret, understand, and value the opportunity. The acquirer must validate the seller’s technical work and assessments, gather additional supporting technical data, develop an economic model from decline curve analyses (including CAPEX and OPEX insights), establish relevant transaction benchmarks, and qualitatively evaluate the operator’s capabilities.

Key components of the appraisal and valuation effort include setting technical and business metric thresholds, organizing key professionals’ work product and interactions, managing data inventory, validating existing analyses, filling in missing data with insights from analog plays, and consolidating results into actionable recommendations. The results of the appraisal and valuation exercise includes an itemization of positives, negatives, and residual uncertainties that the acquirer must incorporate into their portfolio evaluation process and estimate the value created, if the acquisition is consummated. This paper uses a recent successful acquisition to illustrate a workflow that compresses the time required to screen and evaluate a shale play acquisition in the US.

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