Risk Analysis in Petroleum Industry
Course Code: OG07
Course Objective
- 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, different economic analyses for petroleum related project and determine economic indicators
- 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
- Contribute to the petroleum project investment within a solid economic system and do a detailed economic evaluation
- Contribute to the decision-making process for any petroleum related project
Target Audience
- Oil & Gas Field Engineers
- Oil & Gas Managers
- Oil & Gas Auditors
- Oil & Gas Planners
- Financial Analysts
Course Outline
DAY 1: Cash Flow Analysis
- Familiarization with Economic terms
- Setting up Cash Flow Calculation
- Depreciation Methods
- Loss Carry Forwards
- Inflation
- Nominal & Real Cash Flow
- Sunk Costs
- Project Financing
DAY 2: 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
DAY 3: Risks and Uncertainties
- Risk & Uncertainty
- Expected Value Concept
- Decision Tree Analysis
- Farm-out Decision
- Probability Analysis
- Sensitivity Analysis
- Probability Distribution
- Monte Carlo Simulation
DAY 4: Setting up Spreadsheet Calculation
- Introduction to Spreadsheet Calculation
- Simple Cash Flow using Excel
- NPV calculations
- Application of economic indicators
- Class discussion
DAY 5: Setting up Oil Field Development Model
- Group activities
- Setting up an Integrated Economic Model of a Typical Oil Field Development
- Project Sensitivity Analysis for the selected model
- Introduction to Russell field model
- Final remarks
Register for this course
Date & Location