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Texaco Uses Crystal Ball Pro To Evaluate
Inventory And Optimize Production Levels
CUSTOMER OF THE MONTH (OCT. 1998)
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Rick Ruthrauff is an Evaluation Engineer in Texaco's Deep Water
Exploration Group and uses Crystal Ball Pro for several different
applications.
One of Rick's primary uses of CB Pro is in evaluating Texaco's
inventory as well as the inventory of their competition. Rick analyzes
the different prospects within Texaco's portfolio in an effort to
determine the size, economics, and success ranges for each area.
In his Crystal Ball simulations, Rick is able to vary the number
of prospects drilled, the chance of success, and alter the reserve
and value distributions selected from the Distribution Gallery.
The leases held by Texaco's competitors are public record, so Rick
is able to estimate the size, value, and success probability of
both their drilled and undrilled inventory. There is less data and
more uncertainty with these simulations, but they still provide
a valuable tool in measuring the success of the competition.
Another valuable tool Rick uses is Crystal Ball's Sensitivity Charts.
This allows Rick to better understand the parts of his models that
are contributing the most to the results. Rick can then manipulate
his model inputs to lessen the dramatic impact on results.
Rick has also employed CB Pro's OptQuest technology to help determine
the optimum number of wells needed to achieve a specific objective.
For example, if Texaco is interested in obtaining a certain number
of barrels of oil with a particular expenditure level, OptQuest
will point to the optimum combination of wells to achieve the desired
production level.
Rick recalls a specific instance in which the use of CB Pro influenced
Texaco's decision not to purchase a company with deep-water exploration
acreage. Through conducting Crystal Ball analyses, it was determined
that the money needed to purchase the company would derive more
value if it were invested elsewhere. In this case, Texaco was able
to avoid making a potentially costly investment by releasing the
power of CB Pro.
Risk and uncertainty are an inherent part of the petroleum industry.
Texaco has recognized the importance of using tools such as Crystal
Ball Pro to help mitigate the unknown factors found in difficult
decisions.
(08/24/00) PRESS RELEASE:
Texaco Selects Decisioneering's Crystal Ball 2000 Professional Edition
for Worldwide Reserve Asset Valuation
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& Gas industry page!
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