Lookup methods
Depending on variable properties, you can use lookup methods and comparisons to retrieve data from tables. There are four lookup methods (threshold, incremental, interpolate and step), and three comparison operators: <, <= and =.
Threshold
This lookup method is used less often than the others. A typical example is for production bonuses in which a payment is made once only when production exceeds a specified threshold, i.e. the bonus is not paid in each period that production is above the specified threshold. This method is used with "=" operator.
| Input | Result |
|---|---|
| 5,000 | $1,000 |
| 10,000 | $1,500 |
| 20,000 | $2,000 |
The following table shows lookup results.
| Production | Bonus |
|---|---|
| 2,500 | 0 |
| 6,000 | 1,000 |
| 7,500 | 0 |
| 12,000 | 1,500 |
| 25,000 | 2,000 |
| 30,000 | 0 |
Incremental
To explain how an incremental lookup works we will use the example of a royalty rate based on production tiers. The first 5,000 bbl/day pays 0% royalty. The next 5,000 bbl/day pays 3% royalty and so on. In this example we use "<" operator.
| Input | Result |
|---|---|
| 5,000 | 0% |
| 10,000 | 3% |
| 100,000 | 5% |
The following table shows lookup results.
| Prod. | Tier 1 | Tier 2 | Tier 3 | Effect. Royalty | ||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Eligible | Rate | Balance | Eligible | Rate | Balance | Eligible | Rate | Balance | ||
| 2,500 | 2,500 | 0% | 0 | 0 | 3% | 0 | 0 | 5% | 0 | 0.00% |
| 5,000 | 5,000 | 0% | 0 | 0 | 3% | 0 | 0 | 5% | 0 | 0.00% |
| 7,500 | 5,000 | 0% | 2,500 | 2,500 | 3% | 0 | 0 | 5% | 0 | 1.00% |
| 10000 | 5,000 | 0% | 5,000 | 5,000 | 3% | 0 | 0 | 5% | 0 | 1.50% |
| 20,000 | 5,000 | 0% | 15,000 | 10,000 | 3% | 5,000 | 5,000 | 5% | 0 | 2.75% |
| 30,000 | 5,000 | 0% | 25,000 | 10,000 | 3% | 15,000 | 15,000 | 5% | 0 | 3.50% |
Step
Royalty can also be used to describe a step lookup method. In this example a field pays 0% royalty if production is lo than 5,000 bbl/day. If production is between 5,000 and 10,000 then royalty is payable at 3% on all production. If production exceeds 10,000 bbl/d then the rate is 10%. In this example we use "<" operator.
| Input | Result |
|---|---|
| 5,000 | 0% |
| 10,000 | 3% |
| 100,000 | 10% |
The following table shows lookup results.
| Production | Effective Royalty |
|---|---|
| 2,500 | 0% |
| 5,000 | 0% |
| 7,500 | 3% |
| 10,000 | 3% |
| 25,000 | 10% |
| 30,000 | 10% |
Interpolation
As in the first two methods the field pays 0% royalty up to 5,000 bbl/day. Between 5,000 and 10,000 a straight line interpolation is performed to get a rate between 0% and 3%. Above 10,000 the rate stays at 3%. In this example we use "<" operator.
| Input | Result |
|---|---|
| 5,000 | 0% |
| 10,000 | 3% |
| 100,000 | 3% |
The following table shows lookup results.
| Production | Effective Royalty |
|---|---|
| 2,500 | 0% |
| 5,000 | 0% |
| 7,500 | 1.5% |
| 8,500 | 2.1% |
| 10,000 | 3.0% |
| 30,000 | 3.0% |