16 – 18 Mar 2011 | Yogyakarta

22 – 24 Jun 2011 | Bandung

9 – 11 Nov 2011 | Yogyakarta

Course Overview

When a PSC Agreement has been signed and approved by the Ministry of ESDM then the PSC will immediately perform pre-POD preparation and submission to BPMIGAS for approval, Plan On Development (POD) in the phase of exploration and development of field(s) within the PSC block in the purpose of exploring, developing, and producing oil or gas reservoirs and make it commercially through analyzing technical aspects, economics aspects, and environmental aspects. After three evaluations aspects have thoroughly been done and the results have met them and sounds commercially economics be continued with submission of WP&B – Operating Budget and AFE for capital investments. These efforts must be done both by PSC and BPMIGAS in order to see uneconomically probability by involving all technical expertise in petroleum operations and activities, financial expertise in economics, legal expertise and environmental expertise in the environmental aspects, and such disciplines will work together focusing to the field(s) that proposed to be developed by PSC contractor. In the technical aspects involve Geological and Geophysics, Reservoir Engineering, Drilling Engineering, Production Engineering, Facilities Engineering, Logistics and Transportation, Formalities and etc, economics aspects involve Economics and Planning, Finance, Controller, Taxes, etc, environmental aspects involve PSC legal counsel, Corporate counsel, and environmental, and etc. All analyses toward the POD and WP&B and AFE will be concentrated the most three aspects result in justifying approved or disapproved proposal. A technically, economically, and environmental proven give good prospects of exploring and producing reservoirs out of the field(s), which shows duration periods of producing field(s), producing volumes, and the costs related. Based on the technical justifications then economics experts will do economics evaluation, calculating such IRR, POT, and NPV of the total investment. These all are done and required to minimize risks exposure against PSC Contractor as well as BPMIGAS/GOI whenever such projects are duly performed.

AFE projects will individually evaluated its financial aspects by using technical aspects and environmental aspects, making economics approaches will be generate net cash flow to PSC Contractor and its economics contributions to GOI. All assets as the result of capital investment are belong to GOI, and pay back to Contractor will be through depreciation expense as mandated in the PSC Agreement, whether such assets categorized as group one, two and three, where the assets’ lives vary among those groups. Cost Recovery is recognized by prior year operating costs, current year operating costs, previous years’ assets depreciation expense, current year’s assets placed in to service depreciation expense. All these aspects shall be integrated in the economic return to PSC Contractor and economic fulfillment to GOI.

The equilibrium of economic rent to both side out of POD, WP&B, and Capital investment is so critical and logically must done accurately, by forcing potential losses and maximize revenues out of the covered projects investment.

Course Objectives

Will provide the participants with the knowledge and concepts of this economic evaluation and result leading their views and awareness in doing and handling the actual projects in their operations economically, effectively and efficiently staring from the beginning until the end of projects’ lives. As continuing generations, will be expected their awareness of the potential: gains, losses, economic risks, and environmental risks as the effect of the company’s operations and activities where the participants work for.

Course Benefits

Each participant will internalize the result of investing capital and operating costs and the potential risks that may be faced by the PSC Contractor if the results are in contrary with economics analysis, require participants doing better in their daily works.

1. Expenditures
2. Development Drilling Expenditures.
3. Completion Drilling Expenditures
4. Production Costs
5. Inventory

Day three:

1. Cost Recovery
2. Interchangeable costs between Oil and Gas costs
3. Interchangeable between administrative and capital investment
4. Sharing costs and revenues between government and PSC company
5. Reflection of good cost Control will reduce cost
6. Reflection of good control to tax liability: Corporate Income Tax and withholding taxes
7. Closing Summary

Course Leader

Jamaluddin Siregar, BBA, Sth, Dipl Int’l Management, MBA