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GASFRAC Energy Services, Inc. Message Board

  • financialkochin financialkochin Jun 2, 2011 1:54 PM Flag

    A Test for Gasfrac

    Thanks for your Houston Presentation early in May. But a skeptic approaching the data presented there might suspect that the examples chosen were not representative. One way of draining such skepticism is experiment.
    With a large operator choose 10 drilling prospects that are worth fracing either with propane or water
    Randomly choose 5 for Gasfrac and 5 for water fracing (Get independent drawer to choose
    Frac all 10 and compare NPVs of all in costs and revenue after say two years
    Use predicted output and costs after two years to compare revenues and costs from end of test
    Ten are just illustrative the numbers have to be large enough that if an economically significant difference appeared it would be detectable even with random noise from other factors in unpredictable factors. A biostatistical or Econometric consultant with experience evaluating experiments would probably be a good investment for this experiment as would an credible independent consulting petroleum engineer to estimate production past the date at which the results of the experiment would be reported.
    Ten seems to be large enough (at a guess) with the size of difference reported but the econometric or statistical consultant. It would be hard to do a double blind as the crews have to know what is being used to frac- water or Gasfrac So perhaps an Econometrician who is used to setting up and evaluating experiments with less than Gold Standard double blind controls. For example an Econometrician used to evaluating the results of natural experiments. The results of such an experiment would be very newsworthy and would appear in the business press all over the planet. If a driller somehow missed hearing about them his neighbor or gold partner would carry the news to him.

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