This article will explain how to use the Multi Sensitivity form. What this form does is allow you to see how changes would affect your well. Changes that will affect the economics of a well include changes to:

  • Production
  • Price
  • Variable Costs
  • Fixed Costs
  • Capital Expenditures

You can evaluate variables in all of these areas, one area, or any combination.

 

When you click on the Multi Sensitivity form you will see this:

 

The form is divided into two sections. The top section is where you will enter your inputs. The bottom section is where the results are displayed after you run the appropriate models.

Sensitivity Inputs: These inputs are multipliers. For example: If you want to see what effect a 10% price increase would have on the NPV you would enter 1.1 into one of the sensitivity fields within the Price column. If you want to see the effect of a 10% decrease in price you would enter 0.90. The model will multiply the price you entered in the Price and Prod Tax form by this entry.

You can use as many or as few of these fields for your evaluation.

Results: This portion of the form will only be populated or updated when you run the appropriate models. (More information on that below.)

There are five tabs in this section, Production, Price, Variable Costs, Fixed Costs, and Capital. What is displayed is the result of the Sensitivity evaluation based on the corresponding inputs entered in the top portion of the form. Each tab will display different results based on the inputs corresponding to that tab.

The Process:

  1. The first thing you need to do is make sure that all of your data is entered correctly for Production Forecast, Price, Costs, Ownership, Capital, etc..
  2. On the Multi Sensitivity form you will enter the sensitivity multipliers you want to evaluate.
  3. Click the  Model icon to configure the model run. You must use the Advanced tab to set the Primary Model Override to use the model: US_Sensitivity. 
     
  4. Click Run. 
  5. To see a report about the NPV you will click the  report icon and select one of the sensitivity reports:
    MultiSensitivities.erw
    SpiderWithFactor.erw

    TornadoSensitivityGraph_Landscape.erw


When the model run is complete you will also see the results of the sensitivity calculations in the lower portion of the Multi Sensitivity form. This results section of this form actually shows the most information about how different sensitivity multipliers affect all other factors. For example, you can see that if you have the No Loss feature enabled, a change in price will affect the production because with a lower price, the well becomes uneconomic sooner resulting in less production. Those relationships are seen on this form.