Practical Design Considerations for Stage Length, Perforation Clusters and Limited Entry Pressure Intensities

2021 ◽  
Author(s):  
Paul Huckabee ◽  
Chris Ledet ◽  
Gustavo Ugueto ◽  
John Tolle ◽  
Somnath Mondal

AbstractThis paper presents design considerations and field trial applications for determining practical dimensions and limits for interdependencies associated with stage length, perforation clusters and limited entry pressures. Recent applications by multiple authors and companies have begun to reverse the decade-long trend of reducing stage length and perforation spacing, in favor of extending stage lengths, to capture free cash flow value for unconventional resource development. Aggressive limited entry has been an enabler for successful extended stage length applications. Multiple authors have advocated "eXtreme Limited Entry" (XLE) applications. We present diagnostics data and applications that challenges the need for XLE and better constrains the necessary amount of limited entry pressures for effective stimulation distribution for resource development across multiple North American Basins.Data is presented from integrated application of field trials, stimulation distribution diagnostics, and well performance analysis. Field trials and well performance analysis are from the Permian Delaware Basin Wolfcamp. The field trials include both: greater perforation cluster intensities for base design stage lengths; and extended stage lengths of 50% greater than the base designs. Diagnostics are from multiple North American Basins and include discrete treatment pressure diagnostics and optic fiber distributed sensing. Data is presented to quantify the magnitude and variability for components necessary for maintaining active fracture extension for multiple perforation clusters. Components include: fracture breakdown pressures; in-situ stress, net fracture extension pressure, and near wellbore complexity pressure drop.Data and examples are presented from multiple wells, and resource development areas, to show the variability in measured treatment pressures for different length scale dimensions. This variability is used to determine the amount of limited entry pressure required to maintain fracture extension, dependent on the stage length dimension. Although Aggressive Limited Entry (ALE) is generally required to enable effective stimulation distribution and extended stage lengths in multiple cluster stages, examples are presented that demonstrate XLE is generally not required. We also discuss some of the considerations and observations that limit perforation cluster spacing intensities. Well performance data from the field trials is presented to validate the applications.This work demonstrates the value of integrated application of field trials, stimulation distribution diagnostics, and well performance analysis to capture free cash flow value from improved completions and stimulation designs. The discussion will include an assessment of future opportunities for further extension of stage length dimensions.

2014 ◽  
Vol 13 (4) ◽  
pp. 793
Author(s):  
Pedro M. Nogueira Reis ◽  
Marion Gomes Augusto

Company valuation models attempt to estimate the value of a company in two stages: (1) comprising of a period of explicit analysis and (2) based on unlimited production period of cash flows obtained through a mathematical approach of perpetuity, which is the terminal value. In general, these models, whether they belong to the Dividend Discount Model (DDM), the Discount Cash Flow (DCF), or RIM (Residual Income Models) group, discount one attribute (dividends, free cash flow, or results) to a given discount rate. This discount rate, obtained in most cases by the CAPM (Capital asset pricing model) or APT (Arbitrage pricing theory) allows including in the analysis the cost of invested capital based on the risk taking of the attributes. However, one cannot ignore that the second stage of valuation that is usually 53-80% of the company value (Berkman et al., 1998) and is loaded with uncertainties. In this context, particular attention is needed to estimate the value of this portion of the company, under penalty of the assessment producing a high level of error. Mindful of this concern, this study sought to collect the perception of European and North American financial analysts on the key features of the company that they believe contribute most to its value. For this feat, we used a survey with closed answers. From the analysis of 123 valid responses using factor analysis, the authors conclude that there is great importance attached (1) to the life expectancy of the company, (2) to liquidity and operating performance, (3) to innovation and ability to allocate resources to R&D, and (4) to management capacity and capital structure, in determining the value of a company or business in long term. These results contribute to our belief that we can formulate a model for valuating companies and businesses where the results to be obtained in the evaluations are as close as possible to those found in the stock market.


Liquidity ◽  
2017 ◽  
Vol 6 (1) ◽  
pp. 1-11
Author(s):  
Nurlis Azhar ◽  
Helmi Chaidir

This study was conducted to examine the effect of Free Cash Flow Ratio, Debt Equity Ratio (DER), Institutional Ownership, Employee Welfare and Price Earning Ratio (PER) to Divident Payout Ratio (Parliament) partially on manufacturing companies listed on Indonesia Stock Exchange period 2011-2015. In addition, to test the feasibility of regression model, the influence of Free Cash Flow Ratio, Debt Equity Ratio (DER), Institutional Ownership, Employee Welfare and Price Earning Ratio (PER) to Divident Payout Ratio (DPR) simultaneously at manufacturing company listed on Bursa Indonesia Securities period 2011-2015. The population in this study are 146 manufacturing companies that have been and still listed in Indonesia Stock Exchange period 2011-2013. The sampling technique used was purposive sampling and obtained sample of 42 companies. Data analysis technique used is by using multiple linear regression test. The results showed that Free Cash Flow Ratio, no significant effect on Divident Payout Ratio (DPR). Debt Equity Ratio (DER) has a negative and significant influence on Divident Payout Ratio (DPR), Institutional Ownership has a significant positive effect on Divident Payout Ratio (DPR), Employee Welfare and Price Earning Ratio (PER) has a positive and significant influence on the Divident Payout Ratio ). Simultaneously Free Cash Flow Ratio, Debt Equity Ratio (DER), Institutional Ownership, Employee Welfare and Price Earning Ratio (PER) give effect to Divident Payout Ratio. The prediction ability of the five variables to the Divident Payout Ratio (DPR) is 21.3% as indicated by the adjusted R square of 0.271 while the remaining 79.7% is influenced by other factors not included in the research model.


1993 ◽  
Vol 22 (4) ◽  
pp. 19 ◽  
Author(s):  
Jeffery A. Born ◽  
Victoria B. McWilliams
Keyword(s):  

2005 ◽  
Vol 95 (3) ◽  
pp. 659-681 ◽  
Author(s):  
James Dow ◽  
Gary Gorton ◽  
Arvind Krishnamurthy

We integrate a widely accepted version of the separation of ownership and control—Michael Jensen's (1986) free cash flow theory—into a dynamic equilibrium model, and study the effect of imperfect corporate control on asset prices and investment. Aggregate free cash flow of the corporate sector is an important state variable in explaining asset prices, investment, and the cyclical behavior of interest rates and the yield curve. The financial friction causes cash-flow shocks to affect investment, and causes otherwise i.i.d. shocks to be transmitted from period to period. The shocks propagate through large firms and during booms.


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