Training on Petroleum Project Economics, Risk & Decision Analysis

Dive into the economics of the oil and gas industry where the success of a project is often determined long before drilling begins. This comprehensive Training on Petroleum Project Economics, Risk & Decision Analysis equips you with the ability to evaluate risks, make financially sound decisions, and enhance the value of petroleum projects. Across five focused Modules, you'll explore economic fundamentals, build cash flow models, and apply valuation techniques like NPV, IRR, and EMV. You'll also tackle international fiscal frameworks and capital budgeting tools within the context of managing uncertainty.

Target Audience

Training on Petroleum Project Economics, Risk & Decision Analysis is deal for professionals involved in economic evaluation, financial planning, and strategic decision-making in the oil and gas sector:

• Petroleum Economists: Deepening financial insights.
• Financial Analysts and Planning Professionals: Enhancing decision-making capabilities.
• Project Managers and Investment Decision-makers: Evaluating project viability.
• Reservoir and Production Engineers: Managing budgets and economic strategies.
• Commercial and Business Development Managers: Guiding strategic initiatives.
• Energy Consultants and Advisors: Providing expert economic guidance.
• Government Officials and Regulators: Negotiating petroleum contracts.
• Academics and Researchers: Exploring energy finance and petroleum economics.

Training Objectives

By the end of this course, participants will:

• Understand petroleum economic evaluation fundamentals.
• Develop detailed cash flow models integrating revenue, CAPEX, OPEX, and tax considerations.
• Apply valuation techniques to assess project viability.
• Analyze international fiscal frameworks and petroleum contracts.
• Evaluate investment alternatives with capital budgeting tools.
• Incorporate probability theory in risk assessment.
• Use decision trees and EMV for strategic evaluation.
• Present economic results with visual analysis tools.

Course Outline

Module 1: Foundations of Petroleum Project Evaluation

• Objectives and relevance of economic evaluation.
• Core oil and gas activities and expenditure patterns.
• Time value of money, interest calculations, and financial functions.

Module 2: Cost Structures and Cash Flow Modelling

• Revenue, CAPEX, and OPEX in cash flow analysis.
• Forecasting production and estimating costs.
• Transitioning from before-tax to after-tax cash flows.

Module 3: Valuation Techniques and Fiscal Frameworks

• Profitability indicators and project valuation.
• International petroleum agreements and fiscal systems.
• Risk-sharing arrangements and fiscal regime comparisons.

Module 4: Investment Analysis and Probability Fundamentals

• Investment decision types and capital budgeting.
• Probability distributions and statistical concepts in risk assessment.
• Modeling uncertainty using distribution fitting.

Module 5: Decision-Making Under Uncertainty

• Expected value concepts and sensitivity analysis.
• Decision trees and simulation models in economic analysis.
• Presenting results with sensitivity diagrams and waterfall charts.