I know that a fracked well has a very quick output drop off.
I can find a lot of opinion and speculation on Mississippian well expected volume or production life but is there actual data or history for this area. Where did SD get there original estimates from ?
What are the oldest fracked wells in this area?
Pretty basic stuff here. Well volume times NG price = future payout.
Exciting but risky. I have to fight myself to not get greedy here with all the unknowns.
I like SDR and PER but they make me ,well you know, frackin nervous !!
We have probably all seen the decline profile graphs for these fracked wells. Like 30% the first month etc. Mostly they flatten out to a 6-7% rate after about year 3. But I don't think there is a huge amount of data out there on mature fracked wells - basically its a #$%$ shoot. I think the bankers sit around in a conference room with the S1 draft and a case of beer, then they decide what numbers they need to justify their underwriting fee. I built a model today on SDT with 6% long term declines and ended up with an NPV-6 of a little better than 13 - i use $100 oil and $6 gas -
You would be able to get that info from the energy commission in Oklahoma and Kansas. In Texas it's the Texas Railroad Commission. I've never done it but had friends in the industry that did. You also seem to have gathered info that fracked wells are shorter lived which is true to the best of my knowledge. I do also believe you'll be hard-pressed to find reliable data without paying for it. May also be able to dig deep enough into public records of these older trust that Sandridge has in the area same formations and extrapolate an answer. It's still gonna be a manipulated equity.