Reserve Based Lending

SERVICE DESCRIPTION

CREST Engineering Services has extensive experience with reserve-based lending through our previous relationships with major lenders, most notably Wells Fargo Bank, Whitney/Hancock Bank and First Tennessee Bank. With 30+ years of experience, we have provide services in single bank deals and bank groups serving as both a member bank or as the bank group lead.

Our services are used by senior debt and mezzanine lenders as follows:

Attending engineering reviews and working with the company/client on engineering.
Adjusting the reserves to be consistent with the underwriting parameters of the bank.
Identifying risk within the reserves that might not be highlighted by the banks lending parameters.
Work directly with underwriting staff to ensure an understanding of the loan collateral.
Advising bank management as needed on senior-debt lending strategies.

WHAT WE VALUE AND HOW WE VALUE IT

Proved Reserves

Producing reserves are typically evaluated using production trend analysis supported by volumetric calculations per industry guidance. These are reserves that are forecast to be recovered by the current completions with current economic parameters.

Non-Producing Reserves

Non-Producing reserves includes future reserves to be recovered from existing wellbores in both current completions and behind pipe completions. These reserves might include additional recovery from artificial lift, secondary recovery such as waterflood or possible behind pipe recompletions.

Undeveloped Reserves

Undeveloped reserves includes reserves that are to be recovered through additional drilling and development. These may include additional wells to be drilled, of secondary recovery projects where higher than normal capital outlay might be required. These reserves are typically based on analogy to offset production and/or statistical evaluation where appropriate.