A new well is proposed to be drilled in an oil reservoir, as an engineer you are requested to perform an economical evaluation of this well and make a decision to perform the drilling plan or abandon the project, given the following information :- Projected initial production rate Annual decline rate = 1000 bbl/day = 10% = 4.0 MM bbl Estimated Ultimate recovery Capital Expense Operating Expense Crude oil price = 6.0 MM $, escalating 4%/year = 4 $/hhl, escalating 2%/year = 15 S/bbl, escalating 0.5 $/bbl Assume investment made in 2000 and oil production started in 1/1/2001. - Perform oil price sensitivity analysis using the following prices 5,10,15,20 $/bbl, if internal rate is 10% -Plot pay out time vs. oil prices -Present value vs. oil prices - Rate of return vs. oil prices NPV vs. discount rate