Petroleum Economics, Project Evaluation, Risk and Decision Analysis Masterclass

Why Select this Training Course?

The Petroleum Economics, Project Evaluation, Risk, and Decision Analysis Masterclass is meticulously designed to provide industry professionals with a profound insight into the economic factors that drive the oil and gas industry. As the sector evolves with new challenges and technologies, a keen understanding of financial governance, project valuations, and risk assessments is paramount for being at the vanguard of economic strategy and decision-making in the oil realm.

How does this course help professionals?

The strength of an economic assessment lies in its depth and relevance. This course provides comprehensive methodologies for appraising projects, including the application of discounted cash flow and real options analysis. Participants will master the art of translating complex geological, production, and market data into coherent financial projections.

What advanced risk analysis techniques will this course cover?

Risk analysis is not just about identifying potential pitfalls; it’s about preparing for and mitigating them. This course introduces cutting-edge quantitative risk assessment tools, including stochastic modelling and Monte Carlo simulations, empowering professionals to construct robust decision-making frameworks in the face of the unpredictable energy market.

Who Should Attend?

This premium Masterclass is ideal for a spectrum of professionals such as:

• Petroleum Economists and Financial Analysts
• Oil and Gas Investment Managers
• Energy Sector Project Managers
• Risk Management Professionals
• Business Development Executives in Oil and Gas
• Reservoir Engineers and Geoscientists
• Corporate Planners and Strategy Professionals

What are the Course Objectives?

Participants will:

• Gain a deep understanding of the global oil and gas market and its economic dynamics.
• Develop competency in project evaluation, including cash flow analysis and capital budgeting.
• Enhance their ability to conduct sophisticated risk assessments and scenario planning.
• Learn to apply decision analysis techniques to complex projects.
• Acquire skills to integrate economic analysis into strategic decisions.

How will this course be presented?

The course delivery will comprise:

• Engaging Lectures spotlighting recent economic trends and case studies.
• Practical Sessions employing the latest software tools for economic modelling.
• Interactive Workshops focusing on real-world project evaluation and risk management.
• Group Discussions fostering the exchange of industry experiences and learning.
• Hands-on Application of advanced decision-analysis methods.

What are the Topics Covered in this Course?

Module 1: Advanced Project Economics in Oil and Gas

• Project Valuation Techniques: NPV, IRR, Payback Period, and Profitability Index
• Impact of Fiscal Systems and Government Take on Project Viability
• Cost Structures and Break-even Analysis
• Economic Modelling of Upstream, Midstream and Downstream Projects
• Risk-Adjusted Performance Metrics
• Sensitivity Analysis and Scenario Planning
• Capital Allocation and Budgeting Strategies
• Decommissioning Cost Estimations and Financial Provisions
• Financing Options: Debt, Equity and Project Finance
• Joint Venture Economics and Profit Sharing Agreements
• Cash Flow Forecasting and Long-term Financial Planning

Module 2: Real Options and Strategic Value Assessment

• Real Options in Merger and Acquisition Strategies
• Strategic Planning with Compound Options
• Applying Binomial Tree Models for Real Options
• Black-Scholes Option Pricing Model Adaptation for Real Assets
• Game Theory and Competitive Strategy in Real Options
• Real Options for Valuing Technological Innovations
• Decision Frameworks Incorporating Real Options
• Real Options in Renewable Energy Projects
• Analysis of Switching Options in Multi-Product Operations
• Impact of Volatility on Real Option Value

Module 3: Price Forecasting and Market Modelling

• Scenario Analysis and Price Projections
• Long-Term Energy Price Trends Analysis
• Incorporating Geopolitical Influences on Market Prices
• Machine Learning Techniques for Predictive Modelling
• Impact of Exchange Rate Fluctuations on Energy Pricing
• Forecasts’ Role in Budgeting and Financial Planning
• Modelling the Impact of Renewable Energy Sources on Prices
• Forecasting the Effects of Climate Policies on Energy Markets
• Price Risk Management and Hedging Strategies

Module 4: Risk Quantification and Management

• Monte Carlo Simulation for Risk Modeling
• Decision Tree Analysis for Uncertain Outcomes
• Value at Risk (VaR) and its Applications
• Stress Testing and Scenario Analysis
• Risk Metrics and Key Risk Indicators (KRIs)
• Development of a Risk Management Plan
• Risk Register Creation and Maintenance
• Implementation of Risk Response Strategies
• Enterprise Risk Management (ERM) Frameworks
• Financial Risk Management for Currency and Interest Rate Exposure
• Credit Risk Evaluation and Management
• Operational Risk Management Strategies
• Risk Adjusted Return on Capital (RAROC) Methodology
• Insurance and Risk Transfer Mechanisms

Module 5: Portfolio Management and Optimization

• Portfolio Rebalancing Strategies
• Black-Litterman Model for Portfolio Optimization
• Multifactor Models for Asset Pricing
• Behavioral Finance and its Impact on Portfolio Management
• Incorporating Alternative Investments into Portfolios
• Dynamic Asset Allocation and Tactical Portfolio Decisions
• Portfolio Hedging Strategies using Derivatives
• Measuring Portfolio Concentration and Risk
• Yield Curve Analysis for Fixed Income Portfolios
• Quantitative Approaches to Portfolio Optimization
• Environmental, Social, and Governance (ESG) Criteria in Portfolio Management
• Performance Attribution Analysis
• Global Investment Performance Standards (GIPS)

Module 6: Decision Trees and Multi-attribute Decision Making

• Addressing Uncertainty and Risk in Decision Making
• Decision Making Under Different Market Conditions
• Software Tools for Decision Trees and MAUT Analysis
• Application of Decision Trees in Project Management, Finance, and Strategy
• Case Studies on Applying Multi-attribute Decision Making in Business Scenarios

Module 7: Uncertainty Analysis in Hydrocarbon Reservoirs

• Probability Distribution Models for Reservoir Parameters
• Volumetric Calculations Under Uncertain Conditions
• Monte Carlo Simulation for Reserves Estimation and Risk Analysis
• Sensitivity Analysis Techniques Specific to Reservoir Performance
• Role of Geostatistics in Reservoir Uncertainty Quantification
• Decision Analysis Tools in Reservoir Management
• Use of Analogues in Reducing Uncertainty
• Time-lapse Seismic Monitoring (4D Seismic) to Manage Uncertainty
• Incorporating Economic Uncertainties in Development Planning
• Stochastic Modeling Techniques for Reservoir Simulation
• Real Options Analysis in Investment Decisions for Oil and Gas Projects
• Addressing Uncertainty in Enhanced Oil Recovery Projects
• Risk Management Strategies and Best Practices in Reservoir Development

Module 8: Contract Analysis and Negotiation

• Negotiation Tactics and Strategies
• Preparing for Negotiations: Planning and Objective Setting
• The Role of Power and Leverage in Contract Negotiations
• Psychological Aspects of Negotiation and Human Behavior
• Managing and Resolving Conflicts in Contract Negotiations
• Collaborative Negotiation Techniques for Win-Win Outcomes
• Cross-Cultural Negotiation Considerations
• Contract Risk Assessment and Management
• The Use of Indemnities and Warranties
• Intellectual Property Rights in Contracts