Advanced Topics in Decision Analysis – Portfolio Analysis and Optimization

 

 

 

 

Course Description

Properly designed portfolio analysis can help your company integrate technical, price, political and market risks into strategy development or goal setting. Once a strategy is decided upon, a portfolio view can help management allocate performance targets to business segments, assets and projects, and identify the types of projects that would be desirable in the future. It can help you determine the value of a potential acquisition or divestiture by analysing the difference between the value of an optimal portfolio with the asset versus the value of an optimal portfolio with it excluded. Because projects and goals interact, an asset will have a different value for every potential buyer.

 

Who Should Attend

This course will introduce to the participants essential skills and knowledge required for roles in planning and strategy departments and for the most senior decision-making roles in an enterprise. It will also be of great benefit to asset managers, or personnel aspiring to become assets managers, (production or exploration) in illuminating the context within which funding decisions are made about their assets and/or projects. Persons who are required to supply input to, or assure the quality of, portfolio decision-making tools and processes. Some familiarity with Microsoft Excel is assumed.

 

Objective

This course will equip you with a working knowledge of the main techniques (qualitative and quantitative) models and processes for portfolio analysis and optimization in the E&P industry. The focus will be on conceptual understanding, practical application and comprehending the strength and weaknesses of the various models and processes. After the course, the participants will understand

 

§         the principles of risk reduction through diversification in oil & gas investments – not just that they work, but why they work

§         how to develop a systematic approach to portfolio development

§         how portfolio development ties directly to the corporate business strategy

§         the use of Monte Carlo simulation and other tools such as stochastic optimization in the context of portfolio development

§         the probability of meeting your goals – short and long term;

§         the best kind of investment for your company;

 

Format

The course will be highly interactive and will use Microsoft Excel to illustrate the application of the concepts.