An Introduction to Upstream Petroleum Economics

Who should attend:

The course is designed to be at an introductory level for those new to the subject of petroleum economics. It is suitable for personnel from all technical and commercial disciplines.

Overview:

This two-day course provides an introduction to the theories and practices of upstream petroleum economics. Delegates will learn how to value oil and gas fields on a standalone basis using the discounted cash flow methodology. Additionally delegates will see some more advanced economic and risk analysis techniques in operation. International petroleum fiscal terms are discussed to enable the delegates to apply the valuation techniques globally.

Content:

This course will cover the following:

• Develop knowledge of upstream petroleum economic discounted cash flow evaluation methodologies
• Become familiar with the derivation, calculation and application of economic metrics such as NPV, EMV, IRR, Payback and PIR
• Learn about the components of an oil or gas cash flow
• Evaluate investment opportunities in exploration, development and production
• Incremental and project consolidation analysis
• Learn about international fiscal systems
• Understand government and oil company perspectives
• Understand the financial structure and mechanisms of production sharing contracts including the calculation of cost recovery and profit oil splits
• Understand practices to quantify uncertainty and risk in exploration, reserves, costs and economic evaluation