Date/Time: Date(s) - 05/12/2022 - 07/12/2022( 8:00 am - 5:00 pm )
Location: Malaysia, Kuala Lumpur

Overview

This course provides practical guidance in the application of the techniques of the economic analysis currently used in the oil & gas industry. It covers the techniques which assist in:

• Making investment decisions under different fiscal structure
• Carrying out cash flow analysis
• Determining economic indicators
• Analyzing and quantifying risk
• Evaluating uncertainty and sensitivity analysis

Objectives

By the end of the course, participants will be able to:

• Analyze the economic viability of various petroleum development projects
• Evaluate various investment opportunities
• Carry out a comprehensive cash flow calculation
• Incorporate inflation and project financing
• Study the application of different depreciation methods
• Determine and compare different economic indicators
• Carry out risk analysis and decision tree analysis for decision makin

Who Should Attend?

• Petroleum, Reservoir and Senior Engineers
• Geologists and Geophysicists
• Technicians
• Fire Officers
• Decision makers such as Supervisors & Managers in the Planning, Exploration, Production, Projects, Financing and Technical Departments throughout the Oil & Gas

Outlines

Cash Flow Analysis

• Familiarization with Economic terms
• Feasibility Studies
• Setting up Cash Flow Calculation
• Tax & Production Sharing Contracts
• Depreciation Methods
• Loss Carry Forwards
• Inflation
• Nominal & Real Cash Flow
• Sunk Costs
• Project Financing

Economic Indicators/Parameters

• Economic Indicators Definitions
• Present Value Concept
• Discount Factor
• Net Present Value
• Internal Rate of Return
• Effect of Start up Date
• 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
• Reserves & Probability Distribution
• Monte Carlo Simulation

Setting up Spreadsheet Calculation

• Introduction to Spreadsheet Calculation
• Introduction to built-in economic/financial functions
• Carrying out simple cash flow using Excel
• Calculating economic indicators
• Developing cash flow charts
• Developing mathematical equations for calculating economic parametersv
• Attempting to develop sensitivity calculation
• Modifying spreadsheet calculation for different fiscal regimes

Setting up Oil Field Development Model

• Developing data input/output scheme for the model
• The use of the built-in functions for calculating different economic parameters
• Setting up an Integrated Economic Model of a Typical Oil Field Development Project
• Developing/incorporating sensitivity calculation & analysis to the model
• The use of the model for other petroleum related projects
• The use of different techniques of developing mathematical equations to speed up model development
• The incorporation of different methods of calculating depreciation.
• Incorporating loss-carry forwards
• Developing all necessary cash flow chart

Training Methodology

• Case Studies.
• Individual and group discussions and exercises.
• Intensive training by using templates, diagrams, and charts.
• Planning activities and presentations.
• Self-assessments.
• Action plan.

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