Buda-Georgetown Lime Play

Buda-Georgetown Lime
Introduction
Production Characteristics
Production Decline Curves
Geology
Economics

Economics

Our typical drilling and completion cost is about $1.2 million, including land costs. The decline curve for the model is the Sage Pack Unit No. 1H.

A model with the following assumptions was constructed:

About $1.2 million of up-front cost, inclusive of acid frac cost and leases.
A 112,000 BO Estimated Ultimate Recovery (EUR).
$40 oil price over the life and $4 gas price.
75% Net Revenue Interest (NRI).

This resulted in a well with a 1.6-year payout, generating an additional $3.1 million dollars of undiscounted cash flow and $1.13 million of discounted cash flow (at a 10% discount factor). The internal rate of return (IROR) is just less than 100%. The Finding and Development cost (F&D) is $1.13 per MCFG Equivalent, at a 10:1 conversion ratio. For a cash flow model, download modestgtcash.xls.