Petroleum Economist: Petroleum Economics & Cost Management

Introduction:

The oil and gas industry demands a deep understanding of economic principles and cost management strategies to navigate market volatility and maximize investment returns. Petroleum economics plays a crucial role in project evaluation, financial planning, and strategic decision-making.

To develop these critical capabilities, Seattle International Institute for Training presents this comprehensive training program focused on petroleum economics and effective cost management.

This course offers participants the tools and analytical frameworks needed to assess project viability, manage costs efficiently, and contribute to sustainable profitability.

Objectives:  

Participants in this course will learn to:

l  Understand the key concepts and models in petroleum economics.

l  Learn techniques for financial evaluation of oil and gas projects.

l  Master cost estimation, control, and optimization strategies.

l  Analyze economic risks and uncertainties in petroleum ventures.

l  Develop decision-making skills based on economic analysis.

Target Audience:

This course is ideal for:

• Petroleum economists and financial analysts.
• Project managers in the oil and gas sector.
• Cost controllers and budget analysts.
• Engineers involved in project planning and development.
• Professionals seeking to enhance their knowledge of oil and gas economics.

Course Outline:

Day 1: Fundamentals of Petroleum Economics 

Ø  Introduction to petroleum industry economics.

Ø  Value chain overview: upstream, midstream, downstream.

Ø  Key drivers of oil and gas project economics.

Ø  Pricing mechanisms and market dynamics.

Ø  Economic indicators and performance measures.

Day 2: Project Evaluation Techniques

Ø  Cash flow analysis and time value of money.

Ø  Net present value (NPV), internal rate of return (IRR), and payback period.

Ø  Sensitivity analysis and scenario planning.

Ø  Economic modeling for field development projects.

Ø  Investment decision criteria in oil and gas projects.

Day 3: Cost Estimation and Management

Ø  Fundamentals of cost estimation in oil and gas projects.

Ø  Types of costs: CAPEX, OPEX, abandonment costs.

Ø  Cost breakdown structures (CBS) and work breakdown structures (WBS).

Ø  Cost control strategies during project execution.

Ø  Managing cost overruns and budget deviations.

Day 4: Risk Analysis and Economic Uncertainty

Ø  Identifying economic risks in petroleum projects.

Ø  Probabilistic modeling and Monte Carlo simulations.

Ø  Risk mitigation strategies.

Ø  Portfolio management and diversification in upstream investments.

Ø  Real options analysis in project evaluation.

Day 5: Advanced Topics and Case Studies

Ø  Fiscal regimes and their impact on project economics.

Ø  Production sharing agreements (PSAs) and service contracts.

Ø  Analyzing the impact of taxation and royalties.

Ø  Case studies of successful and failed petroleum projects.

Ø  Final workshop: Economic evaluation of a sample oil field development