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Informative Article | Science and Technology | India | Volume 8 Issue 10, October 2019 | Rating: 3.1 / 10
The Critical Role of Production Forecasting in the Oil and Gas Industry: Techniques, Challenges, and Business Effect
Abstract: This paper examines why accurate forecasts of natural resource production levels in the oil and gas sector are vital to long-term planning and achieving market position & health of the organization. Forecasting volumes accurately informs financial planning, facilitates investment decisions and effective operations. Today, deterministic and probabilistic approaches are the two most popular methodologies to forecast production volumes. Where deterministic methods will apply specific outcomes to data, for example a known hyperbolic function (the Arps equations), probabilistic methods will include some sort of variability and or uncertainty, and, in turn, provide a range of outcomes. Both methods have its own strength and the breakeven point for both changes according to the resources being forecasted. This document later describes the difficulty of batch processing across many wells due to the extra steps and considerations required. It examines the potential role of machine learning, big data analytics, and batch computing in improving the accuracy and timeliness of forecasts. The combined use of deterministic and probabilistic approaches is routed in technological solutions, which lies within the high potential of the oil & gas sector to become more accurate in its predictions, achieving a rational basis for long-term planning, market positioning and business-to-business activities. The results only highlight the importance of employing better predictive analysis methods in a complex and volatile oil and gas environment which will steer better business decisions.
Keywords: Volumes, Forecasting, Natural Resources, Oil, Gas, Probabilistic, Deterministic, Arps Equation
Edition: Volume 8 Issue 10, October 2019,
Pages: 1876 - 1879