Constructing a Project Cashflow

The construction of a project cashflow requires information from a number of different sources. The principal inputs are typically - 

Petroleum Engineering Reserves Production forecasts - oil, sales gas 

Drilling Engineering Drilling and completion costs Capital costs -platforms -pipelines -compression/pumps 

Operations Maintenance Engineering Operating costs - maintenance - workover - manpower requirements 

Human Resources Manpower costs - operators - technical staff - support staff - overheads 

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As discussed in Section 13.2, the technical, fiscal and economic data gathered to construct a project cashflow carry uncertainty. An economic base case is constructed using, for example, the most likely values of production profile and the 50/50 cost estimates, along with the best estimate of future oil prices and the anticipated production agreement and fiscal system. 

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