TRAINING PETROLEUM ECONOMICS AND FISCAL RISK MANAGEMENT

DESCRIPTION

The course participants will have a thorough background understanding of the general concepts, procedure and terminology of project economics and profitability analysis of Oil and Gas Projects. In particular it emphasizes the peculiarity and fiscal arrangements of the petroleum industry.

It also provides project managers and analysts with a quantitative consideration of risk and uncertainty, and how these factors can be used in formulating investment strategies in the petroleum industry.

It introduces comprehensive ways to evaluate and compare risks associated with different investment choices (using computer aided concepts e.g. Monte Carlo Simulation techniques).

It also reviews the various contractual and fiscal terms prevalent in the petroleum industry, and how the various arrangements affect investment profitability.

OUTLINE COURSE

• Cash Flow
• Net Cash Flow (NCF)
• Profit Investment Ratio (PIR, P/I)
• Payout (Payback, PO, PB)
• Net Present Value (NPV)
• Cost of Capital
• Discounted Profit To Investment ratio (DPI Discounted P/I)
• Return On Investments
• Accounting (Book) Ratio of Return (ROR,ROI,ROCE)
• Internal Rate of Return (IRR,DCF ROR)
• Other Profit Indicators Related to Oil & Gas

RECOMMENDED AUDIENCE

• Petroleum Economists & Financial Analysts: Professionals building cash flow models under shifting fiscal terms, analyzing windfall taxes, and quantifying sovereign/fiscal risk exposure.
• Corporate Tax & Commercial Managers: Executives evaluating tax policy shifts, ring-fencing rules, government take dynamics, and economic stability clauses in international oil contracts.
• Asset Managers & Business Development Teams: Strategic planners assessing foreign entry risks, farm-ins/farm-outs, contract extensions, and political/fiscal uncertainty in portfolio valuation.
• Commercial & Legal Advisors: Counsel negotiating PSC amendments, concession terms, and host-government agreements (HGAs) with embedded fiscal risk mitigations.
• Government Policy Makers & Energy Regulators: Ministry and regulatory officials designing national fiscal regimes, evaluating bid rounds, and balancing host-country take against investor attractiveness.