Oil and Gas
Oil and Gas | Commercial and Risk Analysis
E&P Project Cost Estimation and Control
Format and Duration:
5 days
This course provides participants with an understanding the nature of costs and cost drivers in the E&P industry through the Field Life Cycle. It provides a thorough grounding in the principles of project cost estimation and control for Exploration and Production projects. Different cost estimation classification systems are covered and participants are provided with information about both direct and indirection cost components of projects. Using case studies budgeting principles and cost control strategies are addressed, as well as the approaches to monitoring and controlling project costs. It covers the factors that result in variance in costs through the project phases and emphasises the risk factors that can affect the control of budgets.
Schedule
Duration and Training Method
This is a classroom course comprising lectures, discussions sessions, case studies and short practical exercises.
Course Overview
Learning Outcomes
Participants will learn to:
- Appreciate the importance of effective cost estimation and control in E&P projects.
- Understand the principles of different cost estimation classification systems.
- Be aware of the direct and indirect cost components of projects.
- Consider budget and cost control strategies.
- Be cognisant of approaches to monitoring and controlling project costs.
- Be able to recognise and manage risks that impact on cost controls.
Course Content
Part 1
- Overview of the Oil & Gas Industry –
- Upstream, Midstream Sectors
- The Industry - Global Market Outlook – Into the Future
- E&P: Exploration, Appraisal, Development, and Production
- Importance of Cost Estimation and Control in E&P Projects
Part 2
- Cost Estimation Principles
- Key Concepts and Definitions: CAPEX, OPEX, DRILLEX and ABEX
- Influences on Cost Estimates; Geology, Technology, and Market Conditions
- Cost Estimation Classifications: AACE Classes (Class 5 to Class 1)
- Class 5: Concept Screening Estimates
- Class 4: Study or Feasibility Estimates
- Class 3: Budget Authorization Estimates
- Class 2: Control or Bid Estimates
- Class 1: Definitive Estimates
Part 3
- Cost Components in E&P Projects
- Direct and Indirect Costs
- Drilling Costs (Rig rates, Materials, Logistics)
- Facilities and Infrastructure Costs – onshore/offshore (Medical facilities, Operations/Maintenance/Engineering
- Labour Costs
- Environmental and Regulatory Compliance Costs
Part 4
- Budgeting and Cost Control Strategies
- Setting Up Project Budgets
- Cost Baseline/ Contingencies/Reserves etc
- Work Breakdown Structure (WBS) and Cost Breakdown Structure (CBS)
- Cash Flow Forecasting
Part 5
- Monitoring and Controlling Project Costs
- Cost Performance Indicators (CPI, SPI)
- Change Management and Cost Variances
- Reporting and Documentation: Cost Reports, Dashboards
Part 6
- Cost Estimation – Managing the Risk
- Risk Identification - Technical, Commercial, GeoPolitical, Economic)
- Risk Assessments (QRAs)
- Case Studies, Software, Course Assessment
Who Should Attend and Prerequisites
The course is suitable for technical and non-technical staff working on projects in the oil and gas industry.
Instructors
David Newman
Background
Accomplished and results-driven engineering professional with extensive National and International experience (UK, Europe, Middle and Far East, Scandinavia, CIS (Kazakhstan), India, Mexico in the design, construction, installation, operations, inspection, maintenance, and repair of onshore, offshore and subsea oil and gas and renewable assets. Skilled in managing complex projects across both onshore, offshore and subsea environments, ensuring technical excellence, safety, and on-time deliverables. Co-ordination, supervision and management of multi-cultural and multidisciplinary teams and stakeholders. An extremely passionate individual promoting and delivering Oil and Gas and ‘Energy At Large’ oil and gas and renewables education and training for national and international delegates at national and international locations from graduates to senior levels.
Expertise
- Pipelines Engineering
- Materials Engineering
- Corrosion Engineering and Management
- Risk Based Asset Integrity Management, Pipeline Integrity and Corrosion Integrity Management Programmes
- Plant Integrity / Pressurised Systems Integrity Management (PSSR 2000 regs)
- Process Safety Management
- Ageing Assets and Life Extension
- Health and Safety Management
- Oil & Gas Training and Mentoring
Affiliations and Accreditation
PhD level Asset Management – Subsea Pipelines - Corrosion Risk Analyses
PGradDipl Welding Engineering
MSc Offshore & Subsea Engineering
BSc Hons Materials Engineering
Courses Taught
N685: E & P Project Cost Estimation & Control
N686: Oil and Gas Storage Tanks: Design, Operation, and Maintenance
N733: Subsea Pipeline Engineering
N734: Onshore Pipeline Engineering
N735: Fundamentals of Risk Based Process Safety Management
N736: Process Piping Code, P&IDS and Engineering Drawings Interpretation
N737: Oil and Gas Transport
N746: ASME VIII Div. I - An Objective and Detailed Insight to the Rules for Construction of Pressure Vessels
Accreditation and Certification
CEU: 3.5 Continuing Education Units
PDH: 35 Professional Development Hours
Certificate: Certificate Issued Upon Completion
RPS is accredited by the International Association for Continuing Education and Training (IACET) and is authorized to issue the IACET CEU. We comply with the ANSI/IACET Standard, which is recognised internationally as a standard of excellence in instructional practices.
We issue a Certificate of Attendance which verifies the number of training hours attended. Our courses are generally accepted by most professional licensing boards/associations towards continuing education credits. Please check with your licensing board to determine if the courses and certificate of attendance meet their specific criteria.