Estimated Ultimate Recovery

Estimated Ultimate Recovery (EUR) is one of the most important metrics in oil and gas — it represents the total volume of hydrocarbons a well is expected to produce from its first day of production through economic abandonment. EUR is the foundation for reserve valuation, acquisition pricing, and drilling program economics.

EUR vs. Reserves

EUR and reserves are related but distinct concepts:

• EUR is a physical estimate of total producible volume, independent of ownership or economics
• Proved reserves (as defined by the SEC) require a specific confidence threshold and must be economically producible at current prices
• A well may have a high EUR but low proved reserves if current commodity prices make the tail production uneconomic

How EUR Is Calculated

The most common method is integrating a decline curve from the current production rate to the economic limit:

For exponential decline: EUR = qᵢ / Dᵢ

For hyperbolic decline (numerical): Integrate q(t) = qᵢ / (1 + b·Dᵢ·t)^(1/b) from t=0 to economic abandonment

From cumulative production: EUR = Cumulative production to date + remaining reserves

EUR in Acquisition Analysis

When evaluating a well package, buyers typically compare the purchase price per BOE of EUR against basin type-curve benchmarks. A Permian Basin Wolfcamp well with 600 MBO EUR acquired at $8/BOE implies a $4.8M acquisition value for that well's reserves — which must then be stress-tested against decline rate assumptions and price deck.

EUR estimates are highly sensitive to the assumed b-factor and terminal decline rate. Small changes in these assumptions can shift EUR by 20–40%, making the decline curve calculator an essential sensitivity tool.