The goal of this project was to build a tool where analysts of the energy industry can determine valuations of oil and gas companies. The tool was intended to crunch data on current oil and gas production as well as potential future drilling to formulate a valuation.
Specifically for the project, the client was the Energy arm of the Sales, Research, Trading (SRT) group at Capital One Securities. The basic service SRT provides is the distribution of the valuation data to external clients via newsletters and Excel spreadsheets. While this service was in demand, there was no business model to charge clients. An overarching goal was to remedy this with an easy-to-use online portal that could be billable via subscription.
The goal of the app is to help CapitalOne analysts create a valuation for oil and gas companies.
The two key areas the analysts use to create a valuations for a company is to account for all the oil and gas drilled up to present and then to predict where the companies will drill in the future. They do this for all the land leased by the company.
Current Wells (Drilled to Date, Estimated Remaining Reserves)
Sketch of Flow for Predicting Future Production
Here is a diagram explaining early understandings on the Future Production component of EPIC. Future Production does more than estimate the remaining oil and gas on existing wells. It intends to predict where else a company will drill next based on current leases and “rock” quality of existing land.
Future Production Mockup
The first step for determining how many more wells can be drilled, the analysts grade the companies existing land leases by quality and then determine how many more wells will be built in the existing land. They use a technique called “acreage math” to determine this.
In this screen, you can see that the leased land is broken into 4 categories. The first 3 categories are in color and represent land the company will mostly likely drill on. The last category, in gray, won’t be drilled on. The data scientists at capital one planned how to rank the land.
Launched portal to help CapitalOne analysts determine oil and gas production for energy companies.
Allows users to save time by removing the need to build complicated spreadsheets
Began developing a prototype feature intended to help analysts predict future drilling activity
Design effort was suspended while the data science team could build out predictive models