Input Data Output - Profitability Indicators

Reserves (mmbbls) 4,000 NPV @ 8.00% 8,074

O&M cost ($/bbl) 47.00 IRR 21.72%
Total Investment 8,532
Fiscal Terms Profit to Investment Ratio PIR 2.98
Royalty 12.5% Payout time (in years) 9
Leasing & Drilling Permit $2,500
Contractor profit share 50%
Income Tax 25%
Oil Price (bbl) $92.00
Discount Rate 8.00%
Spillover Cost 207000 Royalty
Production Profile Leasing & Drilling
No of producing wells 3 Income Tax
Daily prod per well 400,000 Discount Rate
Plateau rate (bbls/day) 1200000 Spillover Cost
Annual plateau production (mmbbls) 438.0 Contractor Share https://www.ft.com/content/d3d0cf48-903
Project Life 10 Oil Price
 Input Data Profitability Indicators

Reserves (mmbbls) 4,000 NPV @ 8.00%

IRR

O&M cost ($/bbl) 47.00

Total Investment
Profit to Investment Ratio PIR
Payout time (in years)
Fiscal Terms
Royalty 12.5%
Tax Rate
Income Tax 25%
Leasing and Permit Cost $2,500
Contractor profit share 50%

Oil Price (bbls) $92.00

Discount Rate 8.00%

Production Profile
No of producing wells 3.00
Plateau rate (bbls/day) 1,200,000
Annual plateau production (mmbbls) 438
Project Life 10
 Project Life Production Profile

Oil Oil
Oil reserve
Year Period production Cumultative
Remaining
(mmbbls) Production
8,074
21.72% 2025 0 0 4,000
Exploration 2026 1 0 0 4,000
2027 2 0 0 4,000
8,532 2028 3 0 0 4,000
2.98 2029 4 0 0 4,000
9 2030 5 0 0 4,000
2031 6 438 438 3,562
2032 7 438 876 3,124
2033 8 438 1,314 2,686
Production

2034 9 438 1,752 2,248

2035 10 438 2,190 1,810
2036 11 438 2,628 1,372
2037 12 438 3,066 934
2038 13 438 3,504 496
2039 14 438 3,942 58
2040 15 438 4,380 0

TOTAL

Break down of cost during production

Royal ty Cost
19.03%
Spi l lover Cost
0.94%
DD&A O&M cost
2.23% 77.79%
 Revenue Profile Cost Profile

Oil
Gross Leasing
Production Oil Price CAPEX O&M cost DD&A Spillover Cost
Revenue Cost
(mmbbls)

- - - 5.00 - 2,500.00
- - - 15.00 -
- - - 51.00 -
- - - 51.00 - -
- - - 2955 - -
- - - 2955 - -
438.00 92.00 40,296.00 20,586.00 591.00 250.00
438.00 92.00 40,296.00 20,586.00 591.00 250.00
438.00 92.00 40,296.00 20,586.00 591.00 250.00
438.00 92.00 40,296.00 20,586.00 591.00 250.00
438.00 92.00 40,296.00 20,586.00 591.00 250.00
438.00 92.00 40,296.00 20,586.00 591.00 250.00
438.00 92.00 40,296.00 20,586.00 591.00 250.00
438.00 92.00 40,296.00 20,586.00 591.00 250.00
438.00 92.00 40,296.00 20,586.00 591.00 250.00
438.00 92.00 40,296.00 20,586.00 591.00 250.00

4,380 402,960 6,032 205,860 2,500 5,910

Net Cash Flow (2025 -2040)

4,000.00
Net Cash Flow

3,000.00

2,000.00

1,000.00

-
2025 2027 2029 2031 2033 2035 2037 2039 2041
(1,000.00)

(2,000.00)

(3,000.00)

(4,000.00)
ile
Net Cash Flow
Less
Shell's Income (Profit - Income PV Cash
Contractor
Royalty Cost Total Cost Total Profit Tax Tax-Contractor flow
Profit (50%)
Profit)

2,505.00 (2,505.00) - - (2,505.00) (2505)

15.00 (15.00) - - (15.00) (14)
51.00 (51.00) - - (51.00) (44)
51.00 (51.00) - - (51.00) (40)
2,955.00 (2,955.00) - - (2,955.00) (2172)
2,955.00 (2,955.00) - - (2,955.00) (2011)
5,037.00 26,714.00 13,582.00 6,791.00 3,395.50 3,395.50 2140
5,037.00 26,714.00 13,582.00 6,791.00 3,395.50 3,395.50 1981
5,037.00 26,714.00 13,582.00 6,791.00 3,395.50 3,395.50 1834
5,037.00 26,714.00 13,582.00 6,791.00 3,395.50 3,395.50 1699
5,037.00 26,714.00 13,582.00 6,791.00 3,395.50 3,395.50 1573
5,037.00 26,714.00 13,582.00 6,791.00 3,395.50 3,395.50 1456
5,037.00 26,714.00 13,582.00 6,791.00 3,395.50 3,395.50 1348
5,037.00 26,714.00 13,582.00 6,791.00 3,395.50 3,395.50 1249
5,037.00 26,714.00 13,582.00 6,791.00 3,395.50 3,395.50 1156
5,037.00 26,714.00 13,582.00 6,791.00 3,395.50 3,395.50 1070

275,672 127288 67910 33955 25423

NPV @ 8% 8074

IRR 21.72%

39 2041
Cumultative
Cash Flow

(2505)
(2520)
(2571)
(2622)
(5577)
(8532)
(5137)
(1741)
1655
5050
8446
11841
15237
18632
22028
25423
 50000 5 $'/1000 bbl over threshold
Reserves 4,000 mmbbls
plateau production per well 400000 bbls/day
total plateau production 1200000 bbls/day
plateau production 438.00 mmbbls/annual
Production Cost
cost per well 17 mm$
number of wells 3
Total well cost 51 mm$

Exploratory Cost
G&G 5
3 wells 15
Development Cost 5961
Drilling 51 Split into 2 years
Facilities 5910 2029 and 2030
Total Cost (Exploratory + Development) 5981
years
030