Petroleum Economics - Corporate Tax Rate - Work Redrilling - Report Writing Assignment Help

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Petroleum Economics Report Writing Assignment Help

Task: An offshore well is to be drilled in 50 feet of water. The well will produce 660,300 barrels of crude oil at an average price of $30.64 per barrel, 16,500 barrels of natural gas liquids at an average price of $30.56 per barrel and 443,500 Mscf of dry gas at an average price of $1.64 per Mscf. The production forecast is given in the Table 1. Well costs include the following: It is estimated that there will be an additional expenditure of $1,040,000 in the sixth year for remedial work redrilling. Other data are: Corporate tax rate = 50% Royalty = 20%

1.  Calculate the yearly working interest income
2. If the net operating income after tax is as shown in Table 1, calculate the net income after all investments
3. Evaluate the attractiveness of this investment.

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