PETROLEUM ECONOMIC EVALUATION AND PROJECT INVESTMENT DECISION MAKING UNDER UNCERTAINTIES

  • May 18, 2020 - May 22, 2020
    8:00 am - 5:00 pm

Course Length:     5 Days           Course Dates:     May 18 – 22, 2020            Course Venue:     Calgary, Alberta, Canada

 

Course Description:

Sound project decisions require a comprehensive analysis of project costs, benefits, risks and other factors that may affect potentially affect project outcomes. This course reviews the limits of the traditional “levelized cost” approach to properly take into account risks and uncertainties when valuing different petroleum project investments. It introduces a probabilistic valuation model of petroleum investment projects and their applications for evaluating investment situations. It will discuss objective, systematic and practical methods to deal with decision-making under uncertainty. Case studies will be provided to illustrate the field applications.

Who Should Attend?

This course is designed for project engineers, geoscientists, reservoir engineers, production engineers, petroleum engineers, planning and development analysts, business planner, senior/ executive managers

What You Will Gain:

  • Knowledge of tools and processes for evaluating projects and prioritizing investments decisions
  • How to help a project developer evaluate the economic impact of his project, which accelerate ability to procure financing for the project. How to help several investment groups determine economics of new asset and value of existing assets. Provide investors with a much richer analytical and probabilistic framework to assess upstream petroleum investments. Learn how to define the potential alternatives to a problem or opportunity. How to identify the key drivers affecting our decisions and assess competing alternatives to maximize value in our decisions.
  • Discuss methodologies of analyzing the combined impact of multiple uncertainties on the value of alternative technologies, the value of the operating flexibility and the value of mixed portfolios of different production technologies that present complementary risk-return profiles.

Course Outline:

  • Overview of accounting basics, cost accounting, ratio analysis, investment decisions & profitability. Upstream petroleum economics, risk and fiscal analysis. Net cash flow
  • Economic life and reserves. Distinction between cash flow and profit. Cash flow and tax. Cash flow & fiscal regimes. Incorporating inflation into cash flow projections. Real and nominal cash flows. Depreciation. Economic indicators and example economic evaluations using deterministic and probabilistic methods. Cash flow and risk analysis concepts. Time value of money
  • Basics of decision analysis & investment decisions. Developing decision polices. Decision making process. Investment proposal ranking methods. Capital Management. Decision under uncertainty & risk. Risks and uncertainties in economic evaluation. Field case studies

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