@RISK has many applications for oil and gas exploration and production. This quantitative risk analysis model forecasts production, revenues, and present value based on exponential decline. Uncertain input factors include yearly production, decline rate, GOR, price of gas, price of oil, and rate of increase in oil and gas prices.
A SimTable function is also used in the Discount Rate input that is used to calculate Total NPV. This contains two possible values for Discount Rate – 12% and 14% – enabling you to run two back-to-back simulations to compare the effect of different discount rates on your Total NPV.
