Prospect Evaluation and Petroleum Economics

EART60162 Prospect Evaluation and Petroleum Economics 15 Semester 2 Postgraduate Taught Level 7 Jonathan Redfern Unit coordinator 1 FHEQ level (Framework for Higher Education Qualifications) ' Masters/Integrated Masters P4 ' European Credit Transfer & Accumulation System Rating : 7.5 This course is designed to provide the skills required to identify and assess subsurface resources, developing hydrocarbon play types and petroleum systems, assessing storage for carbon capture, or modelling subsurface geothermal resources.  We assess what data is required and how to undertake an evaluation of leads and prospects, evaluate risk and uncertainty, and review the processes that aid decision making in companies.  The course will teach how to rank prospects, calculate reserves (deterministic and Monte Carlo). The second part of the course builds skills in estimating the economic worth of the project, covering CAPEX, OPEX, NPV and also decision making.  This course is designed to provide the skills required to identify and assess subsurface resources, developing hydrocarbon play types and petroleum systems, assessing storage for carbon capture, or modelling subsurface geothermal resources.  We assess what data is required and how to undertake an evaluation of leads and prospects, evaluate risk and uncertainty, and review the processes that aid decision making in companies.  The course will teach how to rank prospects, calculate reserves (deterministic and Monte Carlo). The second part of the course builds skills in estimating the economic worth of the project, covering CAPEX, OPEX, NPV and also decision making.  <div><div>The unit will be delivered using asynchronous, pre-recorded lectures in preparation for weekly synchronous activities. Synchronous activities will include practice exercises, demonstrations, quizzes and Q&A.   </div></div> <figure class="table"><table border="1" cellpadding="0" cellspacing="0" width="0"><tbody><tr><td style="width:641px;" colspan="2">On the successful completion of the course, students will be able to:</td></tr><tr><td style="height:71px;width:158px;">ILO 1</td><td style="height:71px;width:482px;">Defining a petroleum system, reservoir, source, migration</td></tr><tr><td style="height:38px;width:158px;">ILO 2</td><td style="height:38px;width:482px;">Understand the methodologies for description and analysis – mapping, correlation; including analysis of a play fairway  </td></tr><tr><td style="height:45px;width:158px;">ILO 3</td><td style="height:45px;width:482px;">Calculate resource and risk estimates for a subsurface structure using deterministic and probabilistic approaches</td></tr><tr><td style="height:38px;width:158px;">ILO 4</td><td style="height:38px;width:482px;">Assess subsurface risk and uncertainty and understand the management of risk. Be aware of resource, rate, profile, development selection and operational focus</td></tr><tr><td style="height:38px;width:158px;">ILO 5</td><td style="height:38px;width:482px;">Apply economic workflows and methodologies for financial decision making in the energy industry  </td></tr><tr><td style="height:38px;width:158px;">ILO 6</td><td style="height:38px;width:482px;">Prepare a financial model for cash flow and estimate rates of return on a development project</td></tr><tr><td style="height:85px;width:158px;">ILO 7</td><td style="height:85px;width:482px;">Calculate project economics and assess environmental impact and social responsibility issues</td></tr></tbody></table></figure> <div>Lectures and Practicals:Session 1: Licences and Workflows. Building understanding of business models.  Drivers to decision making  Session 2: Basin Style and Petroleum Systems: Assessing basin types and influence on the petroleum systemSession 3: Monte Carlo Resource Analysis: Practical exercises using the REP software to calculate Probabilistic resourcesSession 4: Play and GDE Mapping: Building Play and GDE maps, integrating data.Session 5: Risk and Uncertainty: Bias and Uncertainty in geological data and interpretationsSession 6: Risk and Uncertainty: Assessing risk of play and prospectsSession 7: CRS Mapping: Mapping risk to define sweet spots of lowest risk to drillSession 8: Introduction to Petroleum Economics: Key terms and definitions, Calculating CAPEX, OPEX, the role of inflation and discountingSession 9: Project economics: Contract Types, Implications, Oil Price, Rate of return, Money of the Day and Real Terms MoneySession 10: Project economics: Environmental impact, social responsibility, life cycle analysis, impact of costs and oil price,  Session 11: Project economics: Decision Tree analysis </div> This module will be delivered as 11 sessions with up to 3 hours asynchronous lecture / practical material and pre-read material, prior to weekly 3 hour synchronous teaching, lecture and practicals, focused on problem solving and data analysis, supplemented by workstation practicals, self-study (background reading, quizzes, revision)  0 Other 40% 2 Written assignment (inc essay) 30% 3 Report 30% <figure class="table"><table border="1" cellpadding="0" cellspacing="0" width="0"><tbody><tr><td style="height:68px;width:102px;">Assessment type</td><td style="height:68px;width:85px;">% Weighting within unit</td><td style="height:68px;width:66px;">Hand out and hand in dates</td><td style="height:68px;width:95px;">Length </td><td style="height:68px;width:170px;">How, when and what feedback is provided</td><td style="height:68px;width:123px;">ILO tested</td></tr><tr><td style="height:101px;width:102px;">Basin Review</td><td style="height:101px;width:85px;">40%</td><td style="height:101px;width:66px;">tbc</td><td style="height:101px;width:95px;">tbc</td><td style="height:101px;width:170px;">Discussion of solution in class and posted on Blackboard</td><td style="height:101px;width:123px;">All</td></tr><tr><td style="height:101px;width:102px;">Monte Carlo Resource Analysis</td><td style="height:101px;width:85px;">30%</td><td style="height:101px;width:66px;">tbc</td><td style="height:101px;width:95px;">tbc</td><td style="height:101px;width:170px;">Discussion of solution in class and posted on Blackboard</td><td style="height:101px;width:123px;">All</td></tr><tr><td style="height:56px;width:102px;">Economics examination</td><td style="height:56px;width:85px;">30%</td><td style="height:56px;width:66px;">End of Semester 2</td><td style="height:56px;width:95px;">1.5 hours</td><td style="height:56px;width:170px;">Marked scripts</td><td style="height:56px;width:123px;">All</td></tr></tbody></table></figure> MSc Petrol Geosci for Explor MSc Petrol Geosci for Explor PGDT Taught Component Mandatory Y Papers will be provided online each week for further reading.  In addition, the following textbooks are recommended: Petroleum Economics and Risk Analysis: A Practical Guide to E&P Investment Decision-Making, 1st Edition, Volume 71 - January 29, 2021 Elsevier; Author: Mark CookPaperback ISBN: 9780128211908.  eBook ISBN: 9780128232064  Lectures 11 Practical classes & workshops 22 Tutorials 33 0 84