An Intensive 10-day Training Course
The 10-Day Advanced Project Economics & Risk Management
Improve Decision-making and Increase Investment Effectiveness
Modules
This course is split in two modules:
Module 1: Project Analysis: Tools & Techniques for Managing Risk & Uncertainty
Module 2: Advanced Project Economics, Risk & Decision Analysis
Each module is structured and can be taken as a stand-alone training course; however, delegates will maximise their benefits by taking Module 1 and 2 back-to-back as a 2-week training course.
Course Outline
Module 1: Project Analysis: Tools & Techniques for Managing Risk & Uncertainty
Day 1
Fundamentals of Decision Analysis
- What is Project Management Decision Analysis?
- The Purpose of the Project Business Case
- The Need for Systematic Risk Management for Decision Making
- Risk and Uncertainty on Projects
- Option Analysis
- Identifying Key Decision-making Factors
- Fundamental Tools of Engineering Economics
- Time Value of Money
- Appraisal Methods - Discounted Cash Flow Projections
- Time Equivalence
Day 2
Cash-Flow Modelling and Project Decision Analysis
- Financial Modelling and Project Evaluation
- Rate of Return Computations (IRR)
- Determining the Internal Rate of Return (IRR)
- The Risk of not understanding IRR
- Understanding the Project Context to assist in decision-making
- Determine stakeholders and their level of influence
- Capture Requirements
- Determine Scope of Work
Day 3
The Cost of Capital
- Capital & Operating Expenditures (CAPEX/OPEX)
- Estimating the Cost of Capital for a Project
- Benefit- Cost Ratio (BCR)
- Dis-benefits
- Identify Risks
- Forecasting Risk Impacts & Probabilities
- Opportunity Costs, Sunk Costs & Salvage Value of a Project
- Determining the Risk Priorities
- The Need for the Company Cash Flow
Day 4
Decision Analysis: Expected Value Concept
- Basic Probability Concepts
- Fundamental Probability Concepts
- Mutually & Non- Mutually Exclusive, Independent Events
- Qualitative Project Risk Analysis
- Semi-Quantitative Bow-Tie Process
- Detailed Risk Qualification and Prioritisation
- Expected Monetary Value
- Scenario Planning
- Sensitivity Analysis Tools
- Simulation Process
- Tornado Diagram
- Defining the Variables- PERT
Day 5
Decision Trees, EMV, Risk Responses and ROI
- Decision Tree Analysis
- Developing Decision Trees
- Solving Decision Trees
- Risk Responses
- Developing Risk Responses
- Evaluating Response Relevance
- ROI Analysis
- Understanding ROI
- Identifying ROI
- Evaluating and Presenting your Project Options
Module 2: Advanced Project Economics, Risk & Decision Analysis
Day 6
Development Economics
- A brief history of energy usage
- Principles of development economics
- Understanding of economic terms
- Inflation and its impact on nominal & real cashflows
- Project financing
Day 7
Uncertainty in Investments
- Handling uncertainty in capital projects
- Understanding probability concepts
- The expected value concept: features and pitfalls
- Expected Monetary Value (EMV)
- Expected Profitability Index (EPI)
- Expected Opportunity Loss (EOL)
Day 8
Risks and Uncertainties
- Risk & uncertainty
- Risk aversion and risk premium
- Exploration project threats and opportunities
- Economic decision criteria
- Decision tree analysis
- Probability distribution
- Monte Carlo simulation
Day 9
Setting-up Spreadsheet Calculations Using Excel
- Spreadsheet Calculations
- Cashflow analysis
- Sensitivity analysis calculations
- Tornado diagrams
- Introduction to Monte Carlo simulations using @Risk
Day 10
Practical Use of the @Risk add-on
- Developing an integrated economic model
- Developing and using an @Risk Model Analysis
- Project sensitivity analysis utilizing data from @Risk Model
- Training course final review and close
Certificate
Oxford Management Centre Certificate will be provided to delegates who successfully completed the training course.
Accreditation
In association with
Duration
10 Days
Format
Classroom
Language
English
Certificate
Yes
