Interactive Portfolio Management

Spotfire Energy Users Confrence Feb. 10, 2004 - Houston, Texas

This was the first of a series of Dr. Stephen M. Rasey's presentation on using Spotfire and Blitzport at Spotfire user conferences in 2004.

Portfolio Analysis Decision Making With Spotfire® and BlitzPort™

Summary of the presentation by Dr. Stephen M. Rasey, Director and CFO,  WiserWays, LLC
February 10, 2004 – Spotfire Energy Forum – Houston, TX

intro Spotfire

Investment Opportunities

Projects where you have an opportunity to invest capital with estimated, but uncertain, profitable returns in the future.

Example: Exploration Projects

exploration projects

Decisions in the Portfolio Management Process

available prospWhat Projects should we consider for investment?

A Prospect Inventory

Which Projects have data good enough to trust building Portfolios?

Data Quality Control

Building a Candidate Portfolio

What Strategies create Portfolios that deliver the best results measured by Short Term Requirements – Long Term Goals – High Confidence Results

WiserWays Confidence Curve Calculator a tool that will quickly compute the inverse cumulative probability curve (a “Confidence Curve”) of 1 or more wells of a portfolio.

confidence reserves

Portfolio Risk and Reward

We Plot the Portfolio as ONE POINT (Risk, Reward) Definitions Efficient Portfolio: A portfolio that provides the greatest expected return for a given level of risk.
Which is Lowest Risk for a given expected return.

risk vs reward

efficient fronteDefinition of:

Efficient Portfolio:

Efficient Frontier:

This is the Frontier for all portfolios with Capex limited to under 500 MMUSD.

So the Frontier is dependent on Budget and Goals

WiserWays BlitzPort™ Confidence Curve Calculator

Available for sale from WiserWays.

Compare BltizPort MultiField to Monte Carl Simulation

WiserWays MultiField Confidence Curve Calculator Superior vs. Monte Carlo Simulation

Compare Trade-Offs Between Conflicting Goals

trade-offsHere we compare Return on Capital Employed in 2006 vs Portfolio NPV (in 2003) The selected points (red-blue) are constrained by CumCapex between 450 and 515 $MM

Efficient Frontiers can also compare trade-offs between conflicting goals

Companies using this Portfolio System?

yes, pemex

Case Study: Select 2003 Exploration Portfolios based upon Reserves, Finding Cost, Development Capex and Production.

Out of Millions of Portfolios in the database,

Spotfire Sheds Light on a Complicated Problem

Woolsey’s 1st Law
“A Manager would rather live with a problem he cannot solve than accept a solution he does not understand.”
Woolsey’s 2nd Law
“A Manager does not want, and will not pay for, an OPTIMUM solution. He wants to be better off now, as quickly and as cheaply as possible.

Spotfire Communicates Portfolio Decisions. How and where the Portfolios are built matters not.

BlitzPort Multifield

WiserWays-Spotfire Portfolio Analysis Process

Goals for Improving the Portfolio Management process

How the proposed project meets these goals

Goals for Improving the Portfolio Management process

BlitzPort and Spotfire

By making VISIBLE the potential funding opportunities, DECISION MAKERS can see available alternatives and the degree of difference (or equivalence) between them.

Thanks to Spotfire
For the opportunity to speak here and for the work we have done together since 2001.

Adán Oviedo Pérez, Subdirector, Exploración Vicepresident, Pemex
Brett Edwards, President, Custer Resources
And Thank You for your attention

The PowerPoint presentation is be available for download or if you prefer it is available in Acrobat PDF instead.