International Oil & Gas Business Management

COURSE OVERVIEW

Through a careful balance of lectures by leading experts and challenging workshop sessions, this two- week program provides a comprehensive working knowledge of the technology, economics, finance, and markets that shape and affect the international gas industry today. It also teaches the management skills needed to develop projects and increase performance within an integrated gas business environment.

LEARNING OBJECTIVES

The primary objectives of this training are to:

• Understand all of the value-added steps from the well to the consumer
• Gain an understanding of the ways the Oil and Gas industries have organized to operate effectively and efficiently
• Learn the details of gas processing
• Learn how crude oil is processed into transportation fuels
• Understand the fundamental economic calculus of both the upstream and downstream Oil and Gas industries
• Develop the skills necessary to evaluate opportunities and make effective decisions related to Oil and Gas operations

COURSE CONTENT

MODULE 1: UPSTREAM GAS BUSINESS

DAY 1

• Overview of the International Gas Industry
• Gas measurements and units;
• the gas chain;
• market structures;
• worldwide natural gas economics;
• major players;
• evolution of the integrated gas-power business.
• Host Government Agreements:
• Typical host country exploration agreements:
• summary of the history and key provisions,
• including bonus payments,
• royalties, taxes;
• production sharing;
• participation arrangements.
• Exploration Methods
• The exploration process:
• petroleum geology, exploration geophysics, well logging, developing exploration prospects, preparing and interpreting geological maps;
• case studies.

DAY 2

• Drilling and Well Completions
• Planning the well;
• logistics;
• drilling functions;
• drilling procedures;
• formation evaluation methods;
• horizontal wells;
• improvements in drilling.
• Energy Project Economics
• Economic yardsticks;
• project cash flow before and after tax;
• tax expenses and benefits;
• net cash flow stream and payout;
• time value of money;
• discounted cash flow analysis and internal rate of return;
• risk assessment and sensitivity analysis.
• Unconventional Gas Resources

A comprehensive and practical understanding of the processes that are applied in the development of unconventional gas projects, by looking at an active investment area: the Marcellus shale project in the United States

DAY 3

• Gas Field Performance and Reserves Estimation
• Overview of production and reservoir management in the gas system;
• production technology;
• well testing; reservoir performance;
• reserves estimation.
• Gas Processing: Technology, Economics, LPG, and Ethylene Markets
• Overview of gas processing systems;
• liquid separation processes;
• LPG fractionation options;
• compression;
• engineering design and contracting methods;
• the market for LPGs;
• project feasibility and economics;
• ethylene processing, economics, and markets.

DAY 4

• Gas Pipeline Systems
• Major considerations in the cost-effective design, construction, and operation of gas pipeline systems;
• system design variables: impact on cost and capacity;
• estimating project costs;
• pipeline load factors;
• typical pipeline tariff;
• examples of recent pipeline construction costs.
• Load Balancing Systems and Tariffs:
• Needs for load balancing and system and customer benefits; storage options, capital and operating costs: underground, cavern, and LNG facilities;
• operational procedures;
• new options for marketing storage services;
• case examples.

DAY 5

• Gas Sales Contracts
• Typical terms in gas sales contracts; price- volume;
• risk allocation;
• from gas contracts to tariffs;
• indexing;
• re-openers;
• typical contract examples.
• Measuring Financial Performance Review of financial statements:
• Income statement, balance sheet, cash flow, and shareholders’ equity;
• capital and operating costs;
• measurements of financial performance;
• benchmarking;
• taxation;
• the accounting and audit process.

MODULE 2: DOWNSTREAM GAS BUSINESS

DAY 6

• Gas Market Analysis and Pricing
• The need to identify gas markets early;
• gas market analysis;
• netback pricing and interfuel competition;
• market segments and market opportunities.
• Gas-Fired Power Plants
• Overview of combined-cycle gas turbine power systems;
• technology: plant design, fuel efficiency, available packages;
• project feasibility: capital costs, economics, risk, financing, contracts, markets, capital and operating cost estimating; contracting for fuel supply and power sales;
• worldwide power trends;
• examples of recent and planned projects.

DAY 7

• Overview of LNG Business
• Overview of the role of LNG within the gas chain;
• technology: LNG plants, liquefaction, ship design and operations, LNG re-gasification units;
• LNG project feasibility: capital costs, economics, risk, financing, markets; LNG plant design: gas reserves to support a plant, contract prices, contracting; examples of recently completed and planned projects.
• Petrochemical Uses for Natural Gas: Methanol, Ammonia, and Gas-to-Liquids Conversion
• use of gas for ammonia and methanol and conversion to liquid fuels;
• processes for conversion of gas to methanol;
• markets and project economics;
• ammonia and fertilizers: source of supply, types of processes, intermediate and end products, markets; project economics;
• examples of recent and planned projects;
• gas-to-liquids conversion;
• available technology;
• major players;
• capital and operating costs;
• economic analysis.

DAY 8

• Gas Distribution
• overview of the gas distribution system;
• types of customers and load factors;
• competition from other fuels;
• sources of gas supply: gas supply contracts, prices, character of gas supply;
• structure and regulation of local distribution companies (LDCs);
• marketing demands; design and construction of distribution systems;
• expansion;
• operations: load balancing, distribution planning, maintenance, environmental considerations, rate-making policies and practices.
• Project Financing: Commercial Debt Structuring and Case Study
• corporate and project financing;
• sources of debt and equity financing;
• public and private sources of capital;
• multilateral and bilateral sources of financing;
• risk assessment and mitigation;
• structuring of financing;
• preparing the financing plan;
• negotiating the term sheet;
• preparing the financing documents;
• Case studies – examples of project financing: Qatar Gas Project; Colombia Power Project; U.S. Gas Storage Project.

DAY 9

• Industry Regulation, Deregulation, and Convergence
• the nature of regulation in the energy sector;
• history and current state of the gas industry deregulation process at the wholesale and retail markets: U.S., Europe, and elsewhere;
• effect of deregulation on the structure of the industry; convergence of gas and power.
• Marketing Natural Gas in an ‘Open Access’ Environment:
• S. market structure;
• basic deal types and where they are done;
• the commercial organization; and
• current issues in U.S. natural gas markets.

DAY 10

• Managing Energy Price and Volume Risks: Futures and Hedging:
• the history of energy price risk management;
• physical, forward, and futures markets;
• typical futures market transactions;
• hedging, swaps, and options;
• volume risk management;
• weather derivatives.