Caprica Energy and Its Choice
Brief company background:
Caprica is a 40-year -old company rooted in Charleston, West Virginia area. First 30 years, it only operated in Kentucky and Ohio. Starting from 1997, Caprica carried on an expansion strategy to Michigan, and in 2005 it applied the hydraulic fracturing technology on shale gas exploiting. Up till now, Caprica already have five years experience on using hydraulic fracturing technology.
Current Strategy:
Caprica’s strategy is to grow its reserves, production, net income and cash flow. It is focus on acquiring properties that have development potential. Meanwhile, Maintaining operational integrity is also a vision Caprica try to pursue, so Barrow need to consider the environmental controversy when making her decision. Failed to response to environmental risk effectively will hurt Caprica’s reputation and thereafter the long-run profitability.
Industry opportunity:
According to U.S. EIA’s 2011 report, there are around 2,552 Tcf potential gas recourses out there to be utilized. As nature gas is more economic sustainable than other energy sources, we can see a remarkable consumption increase in nature gas since 2000. Also, the demand for nature gas always exceeds the outputs produced. The short of supply in nature gas market was mainly because of conventional technology since large portion of potential recourses was lodged far away from the earth, which can not be exploited by conventional technology. However, the recent hydraulic fracturing enables the exploitation of unconventional gas. Therefore, there is significant growth opportunity for the nature gas industry. Caprica’s competitors in market were also trying to develop the new technology to seize nature gas recourses. With five-year fracturing experience, it is Caprica’s opportunity to further expand its business and achieve their growing strategy.
Key issues:
First, Caprica need to decide whether they are going to put effort on unconventional gas exploitation by
Caprica is a 40-year -old company rooted in Charleston, West Virginia area. First 30 years, it only operated in Kentucky and Ohio. Starting from 1997, Caprica carried on an expansion strategy to Michigan, and in 2005 it applied the hydraulic fracturing technology on shale gas exploiting. Up till now, Caprica already have five years experience on using hydraulic fracturing technology.
Current Strategy:
Caprica’s strategy is to grow its reserves, production, net income and cash flow. It is focus on acquiring properties that have development potential. Meanwhile, Maintaining operational integrity is also a vision Caprica try to pursue, so Barrow need to consider the environmental controversy when making her decision. Failed to response to environmental risk effectively will hurt Caprica’s reputation and thereafter the long-run profitability.
Industry opportunity:
According to U.S. EIA’s 2011 report, there are around 2,552 Tcf potential gas recourses out there to be utilized. As nature gas is more economic sustainable than other energy sources, we can see a remarkable consumption increase in nature gas since 2000. Also, the demand for nature gas always exceeds the outputs produced. The short of supply in nature gas market was mainly because of conventional technology since large portion of potential recourses was lodged far away from the earth, which can not be exploited by conventional technology. However, the recent hydraulic fracturing enables the exploitation of unconventional gas. Therefore, there is significant growth opportunity for the nature gas industry. Caprica’s competitors in market were also trying to develop the new technology to seize nature gas recourses. With five-year fracturing experience, it is Caprica’s opportunity to further expand its business and achieve their growing strategy.
Key issues:
First, Caprica need to decide whether they are going to put effort on unconventional gas exploitation by