POD, WP&B, FQR, and AFE CONCEPTS based on
PRODUCTION SHARING CONTRACT ASPECTS
Yogyakarta, 12 – 14 August 2015
Many PSC’ have recruited employees with various education backgrounds and work experiences. As an Oil & Gas company in Indonesia, these employees need to know about the Business Challenge in Oil & Gas Industry they are working for.
To accomplish this task they need knowledge & concepts on the application of How the Production Sharing Contract (PSC) works, how the oil and gas industry is structured in Indonesia, and How to construct POD, WP&B, FQR, and AFE as a budget controlling system.
The production-sharing contract, over the last 40 years, the probably most dominant form of granting access to oil & gas exploration and development to international petroleum companies in developing countries. Its distinct character that production is shared rather than tax/royalties being paid and that the foreign/national investor (now "contractor") is in a contractual relationship with the Government which holds the original mining title. The Government may exercise quite lose control or much more close control over management. Functionally and financially, the PSC models need different in terms of management control, depend on the specific management system established and on the way it is implemented.
The Government may exercise quite lose control or much more close control over management. Functionally and financially, the PSC models need different in terms of management control, depend on the specific management system established and on the way it is implemented.
This 3 days training program provides a concise and comprehensive learning modules on the application technologies in upstream oil industry and all Production Sharing Contract aspects in Indonesia. The modules are specially design for general participations, even for who do not possess technical backgrounds. The modules are wrapped in such a way to ensure easy understanding on the common application of economic aspects and risks in Production Sharing Contract. It includes interactive sessions to explain and discuss the impacts of the industry and future industrial demands.
On completion of this course participants will be able to:
· Describe what a PSC Agreement is and how it is used
· Describe and identify the essential elements of a PSC Agreement
· Engage with key governments, National Oil Companies, Multinational Oil Companies, and Service Companies to facilitate robust contractual and business models.
· Develop skills and competencies required to calculate Cost Recovery & Tax regarding PP No. 79/2010
· Describe the process of forming a POD, WP&B, FQR, AFE, and PIS
· Identify and describe the requirements to develop a suitable POD, WP&B, FQR, and AFE
· Describe and apply the elements required to successfully POD, WP&B, FQR, AFE, and PIS.
1. Regulation Aspects in Indonesia Oil & Gas Industry
· Legal Aspect in Production Sharing Contract.
· Roles & Rules Oil & Gas business under The Law of Oil & Gas Industry No. 22/2001
· Authority Distribution among Ditjen Migas, SKK MIGAS, KKKS, and PERTAMINA
2. Petroleum Fiscal Classification
· Petroleum Fiscal Arrangement
· History of Production Sharing Contract in Indonesia
· Overview of Terms & Conditions in Production Sharing Contracts
3. How the PSC works and how the oil and gas industry is structured in Indonesia
· Section Scope and Definition
· Production Sharing Contract Agreement in brief
· Termination in Production Sharing Contract.
4. Financial Components Relating to Cost Control & Reporting Management
· Production Sharing Contract Accounting System
· Risk and its relationship to cash flow
· Capital & Non-Capital costs application in WP&B
· First Tranche Petroleum, costs, cost recovery, and domestic market obligations
· PP No. 79/2010 regarding cost recovery & Tax
· Case Study: project cash flow model and building a trace diagram
· Over/ Under Lifting
· Impact of Cost Recovery on Production Sharing Split to Contractor.
· Gain win-win increased revenue on the political and more importantly the economic level for Company and Government of Indonesia
5. Cost Control Management in Exploration Stage of PSC
· Control Management System
· Firm Commitment
6. Cost Control Management in Development Stage of PSC
· Describe and implement methods for evaluating a Plan of Development (POD)
· Submitting POD documents to SKK Migas.
7. Cost Control Management in Exploration and/ or Development Stage of PSC
· Describe and identify the meaning of a Work Program & Budget (WP&B)
· Describe and identify the meaning of a Financial Quarterly Report (FQR)
· Describe and identify the meaning of an Authorization For Expenditure (AFE)
· Describe and identify the meaning of a Place Into Service (PIS)
· Describe, procedure, and process of forming a WP&B, FQR, AFE, and PIS
· PTK No. 007 SKK Migas regarding WP&B
· WP&B Revisions and Procedures
· AFE Revisions and Procedures
· Submitting WP&B, FQR, AFE, and PIS documents to SKK Migas.
WHO SHOULD ATTEND
This course is ideal for Managers, Supervisors, Engineers, Geologist, Economist, Finance, Legal, Asset and Project Manager who want to learn from conventional to advance Production Sharing Contract Agreement, processes and procedures of POD, WP&B, and AFE.