Course description

Could you answer the following three questions for your next project?

What will it cost? What is it worth? Will it earn sufficient profit?

Before undertaking any project, these questions should be answered. This course will provide the fundamentals necessary to enable you to do so. Budgeting and financing, and contractual arrangements, which also significantly impact the project economics viability of a project, are covered. Participants practice cash flow techniques for economic evaluations and investigate frequently encountered situations. Participants are invited to submit their own economic problems, if appropriate.


Any professional working in the oil & gas industry with an interest in business and economic affairs but with limited experience in financial matters. The course targets engineers involved in project evaluations as well as finance staff with limited exposure to petroleum economics.


Course content

  • Forecasting oil production 
  • Defining: "reserves," operating expenses, capital expenditures, inflation, factors effecting oil and gas prices 
  • Cash flow techniques 
  • Economic criteria: interest, hurdle rate, time value of money, selection, ranking criteria 
  • Risk, uncertainty: types of risk, mathematical techniques, probabilistic models, uncertainty in economic analysis 
  • Financing, ownership in the oil and gas industry: business arrangements between operators, between mineral owners 
  • Accounting versus cash flow: accounting principles and definitions, differences between accounting cash numbers, depreciation,
  • depletion, amortization 
  • Budgeting: types, processes, selecting of projects for the budget 
  • Economic analysis of operations 
  • Computer economics software 
  • Tips on economic factors in computer spreadsheet analysis 
  • Ethics in economic analysis 

comments (0)

leave a comment