Advanced Petroleum Economics
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Advanced Petroleum Economics Course
Introduction:
This training course in petroleum economics offers comprehensive knowledge and practical skills for valuing oil and gas projects, assets, and companies. By utilizing the petroleum finance techniques taught in the program, participants will gain the ability to conduct valuations of petroleum assets and critically evaluate the valuations performed by others. This will empower them to make well-informed and astute investment decisions in the oil and gas industry.
Course Objectives:
These objectives of the program are to:
- Understand various economic terms used in the oil & gas industry
- Understand how to develop economic models of various petroleum fiscal regimes
- Carry out cash flow analysis and determine economic indicators
- Carry out different economic analyses for petroleum-related projects
- Evaluate and quantify risks and uncertainties
- Make the right investment decision in the presence of risk
- Carry out a comprehensive economic evaluation study for any petroleum-related project including risk analysis and sensitivity study using spreadsheet
Who Should Attend?
Oil & gas professionals such as engineers, geologists, economists, accountants, technicians need to learn how to conduct the economic evaluation and to understand the role of petroleum economics in investment decision making. This program is also recommended for supervisors & managers in the Planning, Exploration, Production, Projects, Financing and Technical Departments in Oil & Gas Companies.
Course Outlines:
Cash Flow Analysis
- Familiarization with Economic terms
- Feasibility Studies
- Setting up Cash Flow Calculation
- Depreciation
- Depreciation Methods
- Loss Carry Forwards
- Inflation
- Nominal & Real Cash Flow
- Sunk Costs
- Project Financing
Economic Indicators
- Economic Indicators Definitions
- Present Value Concept
- Discount Factor
- Net Present Value
- Internal Rate of Return
- Effect of Project Delay
- Payback Period
- Profit/Investment Ratio
- Incremental Projects
- Comparing Economic Indicators
Risks and Uncertainties
- Risk & Uncertainty
- Expected Value Concept
- Decision Tree Analysis
- Farm-out Decision
- Probability Analysis
- Sensitivity Analysis
- Spider and Tornado Diagrams
- Probability Distribution
- Monte Carlo Simulation
Setting up Spreadsheet Calculation
- Introduction to Spreadsheet Calculation
- Simple Cash Flow Using Excel
Setting up Oil Field Development Model
- Setting up an Integrated Economic Model of a Typical Oil Field Development Project including Sensitivity Analysis