JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY HYDERABAD

Course Objectives:

• To emphasize the importance of time value of money in petroleum projects.
• To introduce the students to the theory and practices of Petroleum Economics to perform economic feasibility studies on prospective oil and gas properties.
• To understand the economic and decision analysis parameters in petroleum business.
• To understand the background of functioning of petroleum industry as an economic entity.
• To understand petroleum fiscal system within the context of India.

Course Outcomes

The students would understand the basic features and technical foundations of

Petroleum Economics, Policies & Laws and bridge the gap between the theory and the real world through practical applications based on up-to-date oil and gas projects.

UNIT - I

Introduction to the oil industry: World supply and demand- Structure of the oil industry- Characteristics of crude oils and properties of petroleum products- Resources and development of natural gas. Principles, methods & techniques of engineering economics: Time value in capital expenditures, Depreciation and depletion in oil projects- Financial measures and profitability analysis.

UNIT - II

Analysis of alternative selections and replacements- Risk, uncertainty and decision analysis- Break even and sensitivity analysis- Optimization Techniques. Application and project evaluation: oil fields exploration and drilling operations-Oil fields estimation of oil reserves and evaluation of an oil property- Oil fields production operations- Oil transportation- Crude oil processing.

UNIT - III

Demand and marketing of petroleum products: The petroleum products in the principal consuming countries- The distribution of petroleum products- The marketing of petroleum products.

UNIT - IV

Natural gas: Natural gas supply in the world- Transportation- International Markets and prices. Petrochemicals: General characteristics- economics of the two large basic units- The market for the principal finished products- Problems of today.

UNIT - V

Petroleum or Oil & Gas Rules and Regulations in India – The Oil fields Regulations and Development Act – New Exploration Licensing Policy (NELP) –Open Acreage Licensing Policy (OALP) - Functions of Directorate General of Hydrocarbons – Petroleum and Natural Gas Regulatory Board.

TEXT BOOKS:

• 1. Petroleum Economics and Engineering, H. K. Abdel-Aal, Bakr A. Bakr, M.A. Al-Sahlawi, 2nd Edition, Marcel Dekker Inc., 1992.
• 2. Petroleum Economics, Jean Masseron, 4th Edition, Editions TECHNIP, 1990. (The instructor can download information required from internet to teach the topics in UNIT-V).