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additional area gas reserves are estimated as $100 million and $100 million at 15%
respectively. These data are also in" "Ie 6 and in the appendix. The E(NPV) for
combined area gas reserves, basec)8 simulation runs, is estimated to be $200
million, and is shown in Figure 2. TCllS nearly symmetrical distribution is slightly skewed
to the right.
The E(PV) for combined oil reserves is valued at about $510 million if a
discount rate of 10% is used. Figure 3 depicts these data, and Figure 4 contains E(PV)
data for combined gas reserves. The E(PV) for WIPP site oil reserves is estimated to be
1700 million. Combined gas reserves have an estimated E(PV) of $270 million at 10%.
WIPP site gas reserves have an estimated E(PV) of $130 million. The appendix provides
detail regarding simulation results. The data are summarized in Table 7.
With respect to actual exploration and development of oil and gas resources, the
concern is the net pre:.