Petroleum Economics, Project Evaluation, Risk and Decision Analysis Training Course

Did you know that global upstream oil and gas industry investment in 2022 plunged to just 60% of its 2014 level? This compelling statistic underscores the critical importance of strategic decision-making in petroleum projects and economic risk assessment.

Course Overview

The Petroleum Economics, Project Evaluation, Risk and Decision Analysis course is meticulously designed to equip professionals with cutting-edge knowledge in financial modeling, investment analysis, and petroleum fiscal regimes. This comprehensive programme focuses on economic feasibility studies, oil and gas asset valuation, and production forecasting to ensure participants can effectively navigate the complex landscape of petroleum economics.

Why Select This Training Course?

Selecting this Petroleum Economics Course offers numerous advantages for professionals involved in project evaluation and risk analysis. Participants will gain advanced knowledge of Monte Carlo simulation, sensitivity analysis, and uncertainty management. The course provides hands-on experience with project cash flow analysis and portfolio management in oil and gas, enabling attendees to optimise their decision-making capabilities effectively.

For organisations, investing in this training enhances overall project evaluation capabilities and strengthens risk management strategies. By ensuring that personnel are well-trained in economic modeling techniques and petroleum project financing, organisations not only protect their assets but also build sustainable practices. Research shows that companies implementing comprehensive risk analysis methodologies can significantly improve performance. For instance, BP’s integration of risk analysis into asset management achieved 95% integration of risk management into asset processes and reduced risk-related capital expenditures by $1.2B while maintaining 99.4% operational availability.

Individuals who complete this course will benefit from enhanced career prospects as they become more valuable assets in their respective fields. The skills acquired through this training can lead to professional growth and increased responsibilities within their organisations. Studies indicate that with Shell’s application of real options analysis in deepwater exploration, professionals can significantly improve their strategic decision-making capabilities in volatile markets.

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Who is this Training Course for?

This course is suitable for:

• Project managers and planners in oil and gas.
• Economists and financial analysts in the energy sector.
• Engineers involved in project design and execution.
• Risk management professionals in hydrocarbons.
• Decision-makers in exploration and production.

What are the Training Goals?

The objectives of this training course are to enable professionals:

• To master economic analysis specific to petroleum projects.
• To develop advanced skills in project evaluation and feasibility studies.
• To apply risk analysis techniques for better decision-making.
• To enhance strategic decision-making capabilities in volatile markets.

How will this Training Course be Presented?

The Petroleum Economics Course employs a comprehensive and innovative approach to ensure maximum knowledge retention and skill development. Expert-led instruction from seasoned economics and risk management professionals forms the core of the course, providing up-to-date insights into modern evaluation techniques and practical applications.

Our dynamic training methodology includes:

1. Engaging interactive sessions with industry experts, offering direct insights into economic analysis
2. Immersive workshops featuring real-world project evaluation scenarios
3. In-depth demonstrations of financial modeling and risk analysis software
4. Thought-provoking collaborative projects on investment analysis
5. Comprehensive access to extensive industry tools and resources

Ready to master petroleum economics? Secure your spot today!

Course Syllabus

Module 1: Fundamentals of Petroleum Economics

• Economic principles applied to oil and gas.
• Understanding cash flow in petroleum investments.
• Cost structures in exploration and production.
• Revenue models for oil and gas projects.
• Taxation and fiscal regimes in different countries.
• Economic indicators like NPV, IRR, and ROI.
• Sensitivity analysis for project economics.
• Break-even analysis for oil fields.
• Portfolio management in petroleum investments.
• Economic impact of energy policies.
• Pricing strategies for petroleum products.
• Inflation and currency risk in project economics.

Module 2: Project Evaluation Techniques

• Project lifecycle from conception to decommissioning.
• Feasibility studies and preliminary economic assessments.
• Detailed project appraisal methods.
• Technical and economic data integration.
• Resource and reserve estimation for project evaluation.
• Capital budgeting and investment criteria.
• Reserve replacement cost analysis.
• Economic analysis of enhanced recovery techniques.
• Benchmarking against industry standards.
• Decision trees for project evaluation.
• Real option analysis in project decisions.
• Cost estimation techniques for project planning.

Module 3: Risk Identification and Assessment

• Types of risks in oil and gas projects.
• Risk matrices and probability-impact analysis.
• Qualitative vs. quantitative risk assessment.
• Use of risk registers in project management.
• Political, environmental, and regulatory risks.
• Market and price volatility risks.
• Technical risks associated with exploration.
• Operational risks during production.
• Financial risks, including funding and credit.
• Human factors and organisational risks.
• Risk assessment tools and software.
• Integrating risk assessment with project planning.

Module 4: Risk Management Strategies

• Principles of risk mitigation and management.
• Developing risk response plans.
• Insurance and hedging strategies for risk transfer.
• Contingency planning for high-risk scenarios.
• Risk sharing through partnerships or joint ventures.
• Use of risk-adjusted discount rates.
• Dynamic risk management during project execution.
• Monitoring and reviewing risk management effectiveness.
• Crisis management in response to unexpected events.
• Legal frameworks for managing project risks.
• Ethical considerations in risk management.
• Building resilience against systemic risks.

Module 5: Decision Analysis in Petroleum

• Decision theory and its application in oil and gas.
• Multi-criteria decision analysis for complex projects.
• Decision-making under uncertainty.
• Game theory for strategic decisions in oil and gas.
• Scenario analysis for strategic planning.
• Bayesian analysis for updating decisions.
• Decision support systems in the petroleum industry.
• Optimising decisions with data analytics.
• Balancing short-term gains with a long-term strategy.
• Ethical decision-making in project management.
• Integrating stakeholder perspectives in decisions.
• Learning from past decisions for future improvements.

Module 6: Financial Modelling for Oil and Gas

• Building financial models for project evaluation.
• Forecasting revenues and costs over project life.
• Sensitivity analysis within financial models.
• Scenario modelling for financial forecasting.
• Debt and equity structuring for project financing.
• Cash flow modelling, including taxes and royalties.
• Valuation techniques for oil and gas assets.
• Monte Carlo simulation for financial risk analysis.
• Integration with operational models.
• Financial metrics for evaluating project success.
• Modelling economic impacts of technological innovations.
• Financial planning for project phase transitions.

Module 7: Economic Evaluation of Exploration

• Economics of wildcat versus development wells.
• Risk-reward analysis for exploration ventures.
• Probabilistic reserve estimation.
• Economic analysis of seismic data acquisition.
• Appraisal strategies post-discovery.
• Economic considerations in drilling decisions.
• Farm-in and farm-out deals in exploration.
• Exploration economics in frontier areas.
• Managing the economics of dry holes.
• Economic incentives for exploration investments.
• Portfolio theory applied to exploration projects.
• Value of information in exploration economics.

Module 8: Project Economics in Production

• Optimising production economics.
• Economic implications of production strategies.
• Cost management in mature fields.
• Economic analysis of well interventions.
• Decommissioning economics and cost recovery.
• Production sharing contracts and their economics.
• Economic evaluation of enhanced oil recovery.
• Managing decline curves economically.
• Strategic reserve management for economic benefits.
• Economic considerations in field expansion.
• Life cycle cost analysis in production.
• Aligning production with market dynamics.

Training Impact

Research indicates that organisations implementing structured petroleum economics training programmes have demonstrated measurable benefits in both project evaluation and risk management. Case studies highlight the following comprehensive improvements:

From BP‘s risk analysis implementation:

• 95% integration of risk management into asset processes
• $1.2B reduction in risk-related capital expenditures
• 99.4% operational availability across critical facilities
• 40% reduction in reactive maintenance through predictive systems

Additional benefits include:

• Significant improvement in investment decision-making
• Enhanced project evaluation capabilities
• Improved ability to handle market volatility
• Strengthened risk assessment methodologies
• Increased operational resilience through comprehensive strategies

Transform your career in petroleum economics – Enrol now!