AFE Preparation and Approval in Upstream Oil & Gas Project Course

No Date Location Register
1 21 - 23 Oct 2020 Malang Register
2 18 - 20 Nov 2020 Bali Register


The Cource focuses on the internal view of an organization: planning, cost, and control systems, risk management in project appraisal, and integrated planning and control systems. Successful firms plan their future. This course will facilitate your understanding of the planning process with budgeting woven in followed by those very important control mechanisms to enhance performance 


  1. Determine full costs of outputs for the goods and services provided
  2. Conduct a Cost Volume Analysis (CVA), applying it to multiple cost drivers to make recommendations for program management
  3. Apply Variance Analysis as a management tool to analyze performance-based budgets and determine where you stand in achieving your performance goals
  4. The purpose of budgets
  5. Types of budget
  6. Stages of preparation
  7. Cash budgets — cash flow forecasts
  8. Master budgets and Balance Sheet
  9. Initial steps in constructing a spreadsheet model
  10. Relevant costs
  11. Overheads
  12. Allocation
  13. Appointment
  14. Basic contribution analysis
  15. Break even analysis
  16. Marginal revenue and Marginal Cost


Company / Organisational Impact

  1. The organization will be in a better position to develop useable budgets
  2. Those attending will be in a position to lead others in budget preparation
  3. Learning will be enhanced
  4. Wasted time will be reduced
  5. Strategy & budgeting will be integrated

Personal Impact

  1. Delegates will feel more comfortable with terminology
  2. They will understand the budgeting methods most useful to them
  3. They will understand how to construct a relevant and efficient budget from raw data
  4. The delegates will learn to evaluate the usefulness of costing techniques in accurately calculating and ensuring profitability
  5. They will appreciate the factors which affect the reliability of accounting information



  • Project Manager
  • Project Engineering
  • Project Planning & Cost Engineer
  • Cost Engineer & Estimator
  • Disciplines Engineering Leader
  • Finance Project Executive
  • Cost Accounting
  • The staff person who will be responsible for entering data into the budget system or training others how to enter information
  • Al executives involved in technical projects Budeting& Cost Control



  • General Knowledge

          AFE (Authorization Financial Expenditures)

          . AFE related to Petroleum Industry.  Consists

             of G&G studies, Seismic survey, Drilling and Production

             Facilities, onshore and offshore.

          .  WP & B ( Work Program and Budget )

          .   POD  (Plan of Development)

          .   FQR  (Financial Quarterly Report)


  • PSC Budgeting
    • Financial Budget included AFE for G & G, Seismic / Survey
    • Tangible and Intangible cost in Exploratory Drilling and
    • Development Drilling.
    • Capital and Non capital cost in Exploration,
    • Development, Production and General
    • Operating Cost, Depreciation and Cost Recovery
    • Fiscal Terms in Indonesia
    • Abandonment and Site restoration
    • Insurance
    • Administrative Overhead, Technical Services.
    • Interest Recovery



  1. Elements of the budget framework
  2. The financial statements
  3. Advantages and limitations of budgets
  4. Reporting – The key control
  5. Developing the Revenue Budget
  • Operating versus non-Operating revenue
  • Revenue recognition versus sales
  • Sales forecasting
  • Profitable growth and the cost of capital
  • Pricing consideration
  1. Case study



  1. Cost, profit, volume relationships
  2. Cost of service provided
  3. Operating expenses - selling, G/A, R/D
  4. Directly variable expenses
  5. Fixed expenses
  6. The allocation problem
  7. Assignable and non-assignable expenses
  9. Case study



  1. The business unit statement
  2. Variance analysis
  3. Priorities
  4. Long term versus short-term results
  5. Contingency plans
  6. How not to cut a budget
  7. Case study

Practice & Simulation of AFE Preparation and Approval in Upstream Oil & Gas Project

Post Test; Lesson Learned and Evaluation

Commitment and Action Plan