A type curve is a generalized production forecast constructed from the performance of existing analog wells that represents the expected production profile of a future well in the same area, formation, and completion style. Type curves are essential for planning drilling programs, estimating reserves for undeveloped locations, and building economics models before any production data is available from the actual well. Every E&P company that drills new wells relies on type curves — they are the bridge between geological/engineering knowledge and economic evaluation.
How It Works
Building a type curve requires selecting appropriate analogs, normalizing their production data, and deriving a representative forecast:
- Analog Selection — Wells are selected based on shared characteristics: formation/reservoir, geographic area, completion design (lateral length, proppant loading, stage count), and vintage. In the Permian Basin, a type curve might be built from 50 to 200 wells with similar lateral lengths (e.g., 7,500 to 10,000 feet) completed in the same bench (e.g., Wolfcamp A) within a defined area.
- Normalization — Because analog wells have different completion dates, lateral lengths, and operational histories, their production must be normalized for comparison. Common normalization methods include production per 1,000 feet of lateral (bbl/1000ft), per stage, or per pound of proppant. Time-zero alignment ensures all wells start at month 1 of production.
- Statistical Aggregation — The normalized production from analog wells is aggregated using percentile statistics. The P50 (median) type curve represents the most likely outcome, while P10 and P90 curves bracket the optimistic and conservative cases. Geometric means are often preferred over arithmetic means to reduce the influence of outlier wells.
- Decline Parameters — The resulting type curve is fit with decline parameters (Arps qi, Di, b-factor or Modified Arps segments) for use in economics software. A Permian Basin Wolfcamp A type curve might show a 30-day IP of 800 BOPD, 70% first-year decline, and a 30-year EUR of 600,000 to 1,000,000 BOE per well.
- Updates — Type curves are living documents that must be updated as more wells are drilled and completed with evolving techniques. Completion design changes (longer laterals, increased proppant intensity) can improve type curves by 20 to 50% from one generation to the next.
Why It Matters
Type curves directly determine the economic value assigned to undeveloped acreage and drilling inventory. In acquisition evaluations, the type curve selection can swing asset valuations by 30 to 50%. A company bidding on 500 undeveloped locations with a type curve EUR of 800,000 BOE versus 600,000 BOE at $70/barrel faces a valuation difference of over $500 million in gross revenue alone. Type curves also drive drilling program design — companies allocate capital to areas and formations where type curves indicate the highest returns, and they adjust development spacing based on type curve sensitivity to well density.
How Netora Handles Type Curves
Netora Upstream Platform enables engineers to build type curves from public or proprietary production data, with tools for analog filtering, lateral-length normalization, and statistical aggregation. The platform maintains a type curve library organized by basin, formation, and completion vintage, with automated updates as new production data becomes available. Type curves feed directly into the economics engine, enabling rapid evaluation of hundreds of undeveloped locations without individual well-level forecasts. Learn more about Netora Upstream Platform.