The cheque clears, the pumper gets paid, the water gets hauled, and it all comes out of one pot. Somewhere in that pot is a well that has been taking money out every single month for a year, and nothing on the statement points at it. Work it out well by well and you need net revenue interest, working interest, severance, three handling rates and a BOE conversion, which is why it stays in somebody's spreadsheet and nobody trusts the answer.
Enter the rate, the GOR, the water cut, your interests and your own costs for each well. The planner does the arithmetic and keeps every well on the device between visits.
Revenue at your net revenue interest, less severance and ad valorem, less handling at your working interest, less the pumper and the power. One figure per well, per month, positive or negative as it falls.
Lease operating expense divided by barrels of oil equivalent at 6:1, and the margin on the same basis, so a 3 bbl/d well and a 40 bbl/d well can be read on the same scale.
The oil rate at which net operating income reaches zero, how far above or below it the well is running today, and the oil price at which the same thing happens at today's rate. Both closed-form, not searched for.
Each number is printed with its formula and your own values substituted, so you can hand the page to a partner or an accountant and have the argument about the inputs rather than the arithmetic.
Oil at $62.00/bbl, gas at $2.80/Mcf, 6% severance and ad valorem, handling at $1.10/bbl oil, $0.35/Mcf gas and $0.85/bbl water. Month = 30.42 days (365.25 ÷ 12, rounded). All figures below are the user's own inputs run through the planner.
| Well | Oil bbl/d | NOI $/mo | LOE $/BOE | Margin $/BOE | Econ limit bbl/d | Headroom bbl/d | Breakeven $/bbl |
|---|---|---|---|---|---|---|---|
| Smith 1-H | 8.00 | 5096.78 | 24.87 | 19.63 | 3.00 | 5.00 | 34.15 |
| Jones A-4 | 14.00 | 6880.04 | 7.12 | 15.39 | 2.95 | 11.05 | 19.03 |
| Smith 2 | 3.50 | -524.91 | 45.04 | -4.45 | 4.37 | -0.87 | 68.99 |
Note what the lease roll-up hides. Eleven and a half thousand dollars a month looks healthy until you see that one of the three wells is subtracting from it, and that Smith 1-H carries three and a half times the LOE per BOE that Jones A-4 does despite both being comfortably above their limits.
Built for the operator, the working-interest partner and the production accountant who carry marginal wells and have to decide where the next dollar of workover money goes, by people who have worked the pads.