CPE342 Petroleum Economics Syllabus:
CPE342 Petroleum Economics Syllabus – Anna University Regulation 2021
OBJECTIVE:
To understand the basic quantitative theories and methodologist in oil sector.
UNIT I
Supply and demand curves, the elasticity of supply and demand, public finance concepts such as consumer surplus, excise and export taxes. Forecasting techniques for the energy industry, including energy prices. Demand and supply for natural gas, cured oil and pipeline transportation, determinants of energy demand, energy markets, energy pricing, stability and performance of energy markets.
UNIT II
The economics of investment, Discounted cash flow analysis, Cost Benefit Analyses, Internal Rate of Return, NPV, Profitability Index, Natural Monopoly theory, National competition Policy, Gas Market Regulation, taxation of the oil and gas industry, government policy and trade permits, Monte Carlo analysis, Net Back Pricing, Transfer Pricing and regulatory aspects.
UNIT III
Application of petroleum engineering principles and economics to the evaluation of oil and gas projects, evaluation principles, time value of money concepts, investment measures, cost estimation, price and production forecasting, risk and uncertainty, project selection and capital budgeting inflation, escalation, operating costs, depreciation, cost recovery.
UNIT IV
Petroleum exploration and production contracts. Sharing of the economic rent, portfolio management. Value creation, Corporate finance & return on capital, economic appraisal methods for oil filed development, reservoir model costs and calculations.
UNIT V
Case studies: Economic study of an oil filed development project, petrochemical plant project, natural gas break even price, natural gas liquefaction cost, LGN transport cost, investment profitability study for a gas pipeline.
TOTAL: 45 PERIODS
OUTCOME:
On the completion of the course students are expected to
CO1: Understand the concept of economics in a process plant, time value of money and cost indices.
CO2: Able to integrate knowledge about financial statements, Depreciation and Accounting.
CO3: Able develop economic balance for petroleum engineering equipment’s and determine the optimum cost for operation.
CO4: Understand the basics of principles of management, types of organization and MIS.
CO5: Understand the theory behind Work measurement technique, Production planning and elements of production control in petrochemical industry.
CO6: Understand the concept of inventory control and the role of control charts in quality control in oil and gas industry
TEXT BOOKS:
1. Industrial Economics – An Introductory Textbook. R.R.Barthwal, 2nd Edition, New Age International Publisher.
2. Managerial Economics – D.N.Divedi. 6th Revised Edition. Vikas Publishing House Private Ltd.
3. Standard Handbook of Petroleum and Natural Gas Engineering. 2nd Edition. William C Lyons, Gary, C Plisga. Gulf Professional Publishing.
REFERENCES:
1. Petroleum Engineering Handbook. Bradely, H.B. Society of Petroleum Engineers. Richardson. Texas.
2. The Encyclopedia Americana, International Edition Volume 9, Grolier Incorporated.