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Collaborative, Interactive and Relevant Training for the Energy Industry
 
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COURSE INFORMATION
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Principles and Applications of Uncertainty and Risk Analysis For Upstream Oil and Gas: Using Monte Carlo Simulation
Type:
Training Course

Length:
3 Days
CEU:
2.4
PDH:
24

Fee:
$2195 CAD

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Upcoming Sessions
There is currently no upcoming sessions available for this course. Please check back later!
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Course Description
This hands-on course provides course participants with a thorough understanding of the fundamentals, applications, and methodologies of risk analysis, uncertainty analysis, and decision analysis. Attendees will utilize Excel and one of the popular add-in Monte Carlo software packages (@RISK or Crystal Ball) as they advance through typical upstream oil & gas models and analyses covering the life cycle of a well or field. Examples and exercises will include resource, reserves, well construction cost and time, production, price, and cash-flow models. A comprehensive final case study will have the participants value a field development and recommend the path forward.

A complete set of course materials and lunch is included in this course.

*Participants will need to bring a PC laptop with Microsoft Excel to each day of this course. At the course a trial version of @Risk or Crystal Ball will be installed*
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Course Outline arrow
DAY 1 : Principles of Uncertainty and Risk Analysis
  • Overview − What is Uncertainty, Risk and Decision Analysis? Why do it?

  • Problem Types: Objectives and recurring themes; uncertainty analysis, risk assessment, Monte Carlo simulation, sensitivities, risk management.

  • Descriptive Statistics − Using historical data, grouping the data, histograms cumulative distribution functions and probability density functions, measures of central tendency and dispersion, confidence intervals.

  • Distribution Types − Discrete vs. continuous variables; common distributions: normal, lognormal, triangular, binomial; confidence intervals; comparing distributions; Monte Carlo sampling.

  • Modeling – Define distribution, add outputs, list inputs and outputs, simulation settings, run simulation, moving between the spreadsheet and the results.

  • Building a Simple Model – Profit model.

  • Interpreting Output and Fitting Distributions to Output


DAY 2 : Monte Carlo Simulation Design and Execution
  • Designing a Monte Carlo Simulation Model − Formulating the model, identifying inputs, choosing input distributions, types of outputs, validating the model, use of field data.

  • Additional Hands-on Modeling − More complex volumetric reserves models.

  • Fitting Data with Distributions − Sources of data, narrowing the choice for the right distribution, goodness-of-fit tests, field examples, expert opinions and interviewing techniques.

  • Probability of Success – Geologic, mechanical, commercial – how to incorporate them in our models.

  • Correlation and Dependency − Recognizing dependency, cross plots, regression, correlation, incorporating dependency, examples, rank order correlation, dependency effects.

  • Beyond Volumetric Reserves – Practical upstream applications.


DAY 3 : Applications of Uncertainty and Risk Analysis
  • Effects of Distribution Type and Correlation − Class problem using data to establish distributions and correlation coefficients for a volumetric reserves application.

  • Production/Economic Forecast Application - Model assumptions, from deterministic to stochastic, imposing uncertainty on prices and costs, model shortcomings and refinements.

  • Drilling AFE Generation, Cost Models, General Aggregation Models - Finding component parts, sums of distributions, effects of distribution types and correlation.

  • Comprehensive Models - Reserves to NPV for wells and for prospects.

  • Simple Exploration or Development Portfolio - Combining reserves, capital, success rates.

  • Auditing and Reviewing Simulation Models − A checklist; techniques for reviewing the model.

  • Risk Management – Planning and decision-making utilizing uncertainty enlightenment.

  • Working a Resource Valuation Model
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Instructor arrow
Susan K. Peterson
Susan Peterson is an independent consultant based out of Houston Texas, and is a leader in applying risk and decision analysis to engineering economics and field development strategies.
Susan received her PhD from Texas A&M University in Petroleum engineering with Minors in Finance, Geology and Statistics.
With over 25 years of career experience in the oil and gas industry, Susan now consults on Risk Analysis and Decision Methods on a global scale, instructs on many areas of economics in the Oil and Gas industry, and remains an active member of the Society of Petroleum Engineers (SPE) and the American Association of Drilling Engineers (AADE).
Read More about Susan K. Peterson
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Reviews arrow
"Examples and common pitfalls were most useful."
- Reservoir Engineer

"Susan is clearly an expert in this field. Very good!!"
- VP Production

"I liked how this was a very interactive course. I really enjoyed it."
- Reservoir Engineer

"Susan did a great job of presenting the material and answering student questions as they came up through the course."
- Lead Reservoir Engineer

"The instructor knows her subject very well. Very engaging."
- Sr. Reservoir Engineer

"Susan was very helpful and stayed late to thoroughly answer all of my questions."
- EIT

"Great discussion on example problems. This heightened the understanding of the content. "
- Anon.

"Susan, it has been an honor to be part of your class. I would love the opportunity to be part of another advanced course."
- Project Manager