Essay on Caprica Energy and Its Choice

Words: 1014
Pages: 5

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
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3. Fracturing fluid disposal:
* Large volume of wastewater would flow back to human environment and water treatments are costly for Gas Company. * Chemicals like radiation cannot be filtered out. This threatens people’ s health.
* There are multiple options to treat the wastewater. It not seems like a big deal.

According to the industry opportunity analysis and risk assessment above, I suggest Caprica continue to apply the hydraulic fracturing for business expansion because the profitability for unconventional gas is huge and foreseeable. Although scientists show concerns on related environmental issues, they have not confirmed the relationship between current contamination and fracturing. In addition, the possibility for fracking causing serious damage is low. Caprica can minimize the risks by choosing a project, which has relatively lower pollution potential among the three alternatives. By doing so, Caprica cannot only achieve its growth strategy but also show its concern on social responsibility.

Qualitative analysis: | Project #1 – Tight sand gas | Project #2 – gas shale | Project #3 - Coal bed methane | Implication | Population | Low 40 | Dense 46000 | Moderate 2000 | #1 has lowest risk. #3 is acceptable as well. | Site & Available resources | Barnett ShaleSufficient 0.4 Tcf | Marcellus ShaleHighest25