The 10-Day Advanced Project Economics & Performance Management for Oil & Gas Professionals

Managing Uncertainty and Value-driven Metrics to Improve Project Performance

Introduction

This training addresses the need for professionals in the Oil & Gas industry to manage and control projects. An in-depth treatment of project uncertainty enables delegates to tackle the economic challenges facing the petroleum industry and use effective risk planning and management techniques to support effective decision-making. This ability to control projects is further enhanced through the establishment of effective project governance systems to establish key performance indicators and measure project progress.

Key highlights of this LAKESHORE ISL training are:

• Identification of the stages required in the risk analysis process, i.e., preparing, modeling, and running risk analysis
• Development of the risk model, assessing probabilities to various variables, risk analysis, and explore the impact of uncertain variables
• Enable the participants to perform quantitative risk management techniques and conduct data-driven decision-making using probabilistic profitability indicators
• Exploration of the concept of value and value-driven project management
• Definition of key performance indicators, metrics and reporting dashboards
• Examination of effective governance mechanisms to support planning, execution (change) and performance management
• Application of core planning techniques

The training is split into two modules:

MODULE I – Advanced Oil & Gas Project Economics, Risk & Decision Analysis

MODULE II – Project Performance Measurement and Management

Each module is structured and can be taken as a stand-alone training course; however, delegates will maximise their benefits by taking Module 1 and 2 back-to-back as a two-weeks training course.

Objectives

By the end of this LAKESHORE ISL training, you will be able to:

• Appreciate attitudes to uncertainty and apply decision tree analysis and other risk management techniques
• Gain skills in the application of specific risk management simulation software package
• Conduct an economic study on petroleum related projects
• Use economic terms and concepts applied in the oil & gas industry to select appropriate projects
• Create Key Performance Indicators & establish additional metrics to measure the increasingly complex nature of modern projects
• Compose effective dashboards and scorecards to report project performance
• Apply generally accepted project management techniques to establish and control an integrated project plan baseline

Training Methodology

This training uses a range of approaches to learning, including experiential group activities, individual exercises, mini-case studies, and computer work using PCs to apply risk management approaches. A key part of the learning process is sharing the differing experiences participants bring, as well as experimenting with novel – and sometimes challenging – techniques.

Organisational Impact

By sending delegates on this training your organization will benefit by:

• Enhanced decision-making  and time and resource allocation – leading to better organisational and individual performance
• Use of a well proven planning process
• Increased  recognition of key influences impacting oil & gas field developments
• Excelling in project management practice and increasing organizational maturity
• Equipping employees in refining abilities for project leadership and management
• Gaining confidence from customers by having project professionals capable of applying consistent project management techniques and effective progress communication processes

Personal Impact

By attending this LAKESHORE ISL training, you will:

• Evaluate investment and design alternatives with decision tree analysis
• Gain operational decision making techniques using @Risk
• Gain valuable knowledge in identifying the important uncertainties in petroleum projects
• Appreciating the need to recognize that value-driven approaches and a focus on “outcomes rather than outputs” is fast becoming the driving force of projects
• Familiarize yourself with the PMI PMBOK^®standard which will support any future endeavors in pursuing the widely recognized CAPM^® and PMP^® certifications

Who Should Attend?

This LAKESHORE ISL training is suitable to a wide range of professionals but will greatly benefit:

• Planning Managers
• Oil & Gas Engineers
• Project Managers
• Analysts
• Commercial Managers
• Economists
• Government Officials
• Geologists
• Business Advisors
• Asset Managers
• E&P Managers
• Other key members of oil & gas project teams

Seminar Outline

Module 1: Advanced Oil & Gas Project Economics, Risk & Decision Analysis

DAY 1

Development Economics

• A Brief History of Energy Usage
• Principles of Development Economics
• Understanding of Economic Terms
• Inflation and its Impact on Nominal & Real CashFlows
• Project Financing

DAY 2

Uncertainty in Investments

• Handling Uncertainty in Capital Projects
• Understanding Probability Concepts
• The Expected Value Concept: Features and Pitfalls
• Expected Monetary Value (EMV)
• Expected Profitability Index (EPI)
• Expected Opportunity Loss (EOL)

DAY 3

Risks and Uncertainties

• Risk & Uncertainty
• Risk Eversion and Risk Premium
• Exploration Project Threats and Opportunities
• Economic Decision Criteria
• Decision Tree Analysis
• Probability Distribution
• Case Study: Monte Carlo Simulation

DAY 4

Setting up Spreadsheet Calculations Using Excel

• Spreadsheet Calculations
• CashFlow Analysis
• Sensitivity Analysis Calculations
• Tornado Diagrams
• Introduction to Monte Carlo Simulations using @Risk
• Class Exercises: Setting-up an Oil Field Project

DAY 5

Practical use of the @Risk add-on: Oil Field Development Model

• Developing an Integrated Economic Model of an Oil Field Development
• Developing and using an @Risk Model Analysis
• Project Sensitivity Analysis utilizing data from @Risk Model
• Training Final Review and Close

 

Module 2: Project Performance Measurement and Management

DAY 6

Understanding Project Success and Failure

• Characteristics of Projects
• Fundamentals of Project Management
• Starting a Project –The Charter
• Starting a Project – The Team

DAY 7

Value-Driven Project Management

• Value Modelling and Value Metrics
• Metric Characteristics, Selection, Training and Management
• Project Scope Planning – work breakdown structures
• Schedule Planning – build and optimize project timeline
• Cost Planning – estimation and construction of the project budget

DAY 8

Monitoring Performance through Effective Planning and Reporting Techniques

• Controlling Uncertainty – Risk Management
• Controlling Stakeholders – communications considerations
• Key Performance Indicators
• Status Reports and Project Dashboards

DAY 9

Monitoring and Controlling Project Performance

• Variance Analysis using Earned Value Management
• Forecasting to Control Project Budgetary and Schedule Concerns
• Managing Change
• Advanced Status Reporting Techniques

DAY 10

Stakeholder Management

• Issues Management
• Scope Verification –requirements traceability
• Management of Project Records
• Problem-Solving: Identification, Analysis and Generation of Solutions
• Decision-making Tools and Techniques