9.2k
Times solved
Intermediate
Difficulty
Rating

Problem Definition

Liquid Energy, an Oil & Gas company, is evaluating the purchase of one of three oil fields in Latin America. After purchasing the rights to extract oil from one of these fields, Liquid Energy will outsource the drilling activity. You have been brought in to identify the best investment for Liquid Energy.

How would you evaluate the three oil fields, and which oil field should Liquid Energy purchase?

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9.2k
Times solved
Intermediate
Difficulty
Do you have questions on this case? Ask our community!

Exhibits

Case structure

Drilling rate per region

Average depth of wells by region

Wells are continuously dug for only one year and then oil is extracted going forward. Wells are dug by "rigs".

Once a well has been completed, the rig digs another well.

What are the profits during the first production year? (drilling in 1st year and production during 2nd year)

Calculation matrix

Calculation matrix