Introducing the IHS Capex Index
"New prospect internal evaluation oil price assumptions are challenged by dramatic changes in the IHS Capex Index. The Index is up 14% in the last six months."
Candida Scott, IHS
Richard Ward, CERA
Early findings from the pioneering joint CERA project show rising development costs are rewriting discovery economics assumptions. In fact, the IHS Capex Index suggests IRR parity for the marginal undeveloped discovery may require $35-$45/bbl commodity price assumption to meet internal approval hurdle rates.
The current exuberance in the market around bringing online undeveloped reserves may be happening without a full understanding of these effects.
Click above for more information on the analytics behind the Index.