CMA CMA Production & Operations Analysis 1

Question 1

Which production decline curve model assumes a constant fractional decline rate over time?

Accepted Answer

Exponential decline

Answer

Hyperbolic decline

Answer

Harmonic decline

Answer

Logistic decline

Question 2

In decline curve analysis, what does the hyperbolic exponent 'b' represent?

Accepted Answer

The rate of change of the decline rate itself, indicating how quickly the decline rate is decreasing

Answer

The initial production rate at the start of decline

Answer

The final decline rate the well will reach at economic abandonment

Answer

The ratio of oil to gas production in a multi-phase well

Question 3

What is 'economic limit' in the context of oil or gas production?

Accepted Answer

The production rate at which operating costs equal revenue, making further production uneconomic

Answer

The maximum regulatory production rate allowed by the state

Answer

The reservoir pressure threshold below which production cannot continue

Answer

The minimum royalty rate below which production is not profitable

Question 4

What does 'EUR' stand for in mineral production analysis, and why is it important to appraisers?

Accepted Answer

Estimated Ultimate Recovery — the total volume of minerals projected to be recovered over the life of a well

Answer

Economic Upstream Revenue — the net income from a producing mineral interest

Answer

Effective Unit Rate — the average production rate per unit of mineral acreage

Answer

Expected Undeveloped Resources — undrilled locations estimated to contain minerals

Question 5

Which operational metric measures how efficiently a well converts reservoir energy into surface production?

Accepted Answer

Recovery factor

Answer

Production rate per foot of pay

Answer

Gas-to-oil ratio (GOR)

Answer

Water cut percentage

Question 6

What is 'lifting cost' (also called LOE — lease operating expense) in mineral production?

Accepted Answer

The per-unit cost of extracting and bringing minerals to the surface and preparing them for sale

Answer

The cost of transporting minerals from the production site to market

Answer

The cost paid to the lessor to initiate and maintain a mineral lease

Answer

The capital cost of drilling and completing a well