Capital allocation sits at the centre of any oil and gas company's performance. Decisions on exploration wells, field developments, pipelines, refineries and acquisitions commit capital long before revenue arrives, and the margin for error has narrowed as price volatility, energy transition pressures and higher cost of capital reshape the industry. Stakeholders in national oil companies, independents, service providers and government agencies increasingly need to read and build investment cases with confidence.

This ten-day programme teaches capital budgeting as it is practised in petroleum. Participants first master the core evaluation tools and learn how oil and gas cash flows differ from those in other industries, including field life profiles, front-loaded spending, abandonment costs and sharply varying prices. They then model the effects of fiscal systems such as concessions, production sharing and service contracts on project and government economics, and see how the same project can look very different to an investor, a host government and a lender.

The later part of the course addresses risk, flexibility and portfolio choice, from probability-weighted outcomes and simulation to staged investment decisions and ranking opportunities under budget constraints. Teaching relies on spreadsheet labs and case files, and participants finish by defending a capital proposal before a mock investment committee.

By the end of the course, participants will be able to:

• Calculate and interpret NPV, IRR, payback, profitability index and discounted payback for petroleum projects.
• Construct a project cash flow model from production, price, cost and tax assumptions.
• Estimate a suitable discount rate using weighted average cost of capital and project risk.
• Model royalty, tax and production sharing terms and compare investor and government take.
• Run sensitivity, scenario and Monte Carlo analysis on key uncertainties.
• Value flexibility using decision trees and an introduction to real options.
• Evaluate acquisitions, farm-ins, divestments and decommissioning obligations.
• Present an investment recommendation with clear assumptions and risk disclosure.

The course is designed for people who build, review or approve investment cases in the energy sector, including:

• Petroleum economists and commercial analysts
• Finance managers and corporate planners in oil and gas companies
• Business development and portfolio managers
• Reservoir, drilling and facilities engineers who prepare project estimates
• Government revenue authority and ministry of energy officials
• National oil company strategy and investment committee members
• Bank and development finance lenders to energy projects
• Auditors and advisers reviewing energy investments

Participants leave the programme with:

• A reusable spreadsheet model for field economics with fiscal terms.
• A method for choosing and justifying discount rates and price assumptions.
• A sensitivity and simulation template that highlights the main value drivers.
• A framework for comparing investor and government economics under different contracts.
• A ranking approach for allocating a limited capital budget across projects.
• A completed investment paper and presentation for an assessed project.

The programme is a laboratory for investment analysis, with the following elements:

• Daily spreadsheet labs that build one integrated project model step by step
• Worked case files covering exploration, development and acquisition decisions
• Simulation exercises using standard spreadsheet functions
• Small-group critique of assumptions and results
• A closing mock investment committee that questions each team's recommendation

On completion of the ten days and the modelling exercises, participants are awarded a CPD-accredited Certificate of Completion by Vision Reach Global Consultancy.