An Interactive 5-Day Training Course
Risk & Decision Analysis for Geoscientists
Risk and Decision Analysis for Subsurface
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Duration
5 Days
Price
$ 3,500
Starting From
23 Aug 2027
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Risk & Decision Analysis for Geoscientists
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Risk & Decision Analysis for Geoscientists - GG-DEC-PEA27
| Code | Date | Time | Duration | Location | Currency | Early Bird Fee Per Person |
|---|---|---|---|---|---|---|
| GG-DEC-PEA27 | 23 - 27 Aug 2027 | 10 AM CST | 4 Hours Per Day |
Online |
USD |
3500 |
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Risk & Decision Analysis for Geoscientists
This training covers risk and decision analysis for geoscientists. It works through decision framing, alternatives generation, probability assessment and elicitation, decision trees and influence diagrams, utility and risk preference, value of information and control, sequential and staged decisions, group decision processes, common decision failures and the structuring of subsurface decisions.
Description
Subsurface work exists to support decisions, and most of the quality of a decision is determined before any analysis begins, by how the decision was framed and what alternatives were considered. A well-executed analysis of the wrong question, or a choice between two options when five were available, cannot be rescued by technical rigour. Decision analysis provides the structure that addresses this, and it is a learnable discipline rather than a matter of judgement.
This training covers that discipline as it applies to subsurface decisions. Decision framing is established first, covering the identification of the actual decision, its boundaries, its decision maker and its criteria. Alternatives generation follows, covering the deliberate creation of options rather than the evaluation of the first two that appear. Probability assessment and elicitation are then developed. Decision trees and influence diagrams follow as the structuring tools. Utility and risk preference are then addressed, covering why a risk-neutral expected value calculation is not always the right criterion. Value of information and control follow. Sequential and staged decisions are then developed. Group decision processes follow. Common decision failures are addressed. The training closes with the practical structuring of subsurface decisions.
Framing errors are the most expensive and the least noticed. A team asked whether to drill a prospect will analyse that question thoroughly, when the real decision may be how to allocate a drilling budget across six opportunities, or whether to farm down before drilling, or whether the licence is worth retaining at all. Analysing the narrow question produces a defensible answer to it and forecloses the alternatives. Spending the first hour of a study establishing what the decision actually is, and who makes it, has a higher return than any subsequent hour.
Alternatives have to be generated deliberately because they do not appear. A decision presented as drill or do not drill has two options because nobody looked for more. Deliberate generation produces others: drill a cheaper well, drill a different target, acquire data first, farm down to reduce exposure, defer pending a neighbouring result, or relinquish and redeploy. Some will be poor, and the exercise of listing them reliably produces at least one option better than either of the original two.
Risk preference matters when the stake is large relative to the organisation. Expected value is the correct criterion for repeated decisions with stakes small enough that the law of large numbers applies, which covers most of a large company's drilling programme. For a small company with one well, or for a decision whose downside threatens the enterprise, expected value is the wrong criterion: a seventy per cent chance of ruin with a high expected value is not acceptable. Recognising which situation applies determines whether the calculation answers the question.
Finally, group decision processes systematically narrow ranges. A team that discusses a parameter converges, and the converged range is narrower than the individual estimates justified, because of social pressure, deference to seniority and the desire for agreement. Collecting estimates independently before discussion, and then discussing the differences rather than negotiating a single number, preserves the genuine range. This one change in process measurably improves the calibration of a team's estimates.
By the end of this training, participants will be able to:
- Frame decisions correctly including boundaries and decision makers
- Generate alternatives deliberately rather than evaluating the obvious two
- Assess and elicit probabilities including from colleagues
- Build decision trees and influence diagrams
- Apply utility and risk preference where expected value is inappropriate
- Perform value of information and value of control analysis
- Structure sequential and staged decisions
- Run group processes that preserve rather than narrow ranges
- Recognise common decision failures
- Structure and present a subsurface decision for a decision maker
The training works through real subsurface decisions. Participants frame decisions, generate alternatives and build trees, with the framing stage deliberately revisited to show how much it changes the analysis. Probability elicitation exercises are run and participants' calibration scored. Group decision processes are run under different protocols to compare the resulting ranges.
Organisations sending participants to this training will:
- Frame decisions before analysing them
- Generate a wider set of alternatives
- Improve the calibration of probability estimates
- Apply the right decision criterion for the stake involved
- Direct data acquisition at decision relevant uncertainty
- Improve group decision processes
Participants will:
- Frame decisions clearly
- Generate alternatives systematically
- Assess probabilities more reliably
- Build and interpret decision trees
- Run value of information analysis
- Present decisions to decision makers effectively
- Geoscientists supporting investment decisions
- Reservoir engineers in appraisal and development
- Subsurface team leaders
- Planning and portfolio staff
- Exploration managers
- Technical staff producing recommendations
- Assurance staff reviewing decision support
Module 1 - Decision Framing
- Identifying the actual decision
- Decision boundaries and scope
- Decision maker identification
- Decision criteria and objectives
- Values and trade-offs
- Decision hierarchy: taken, to be made, deferred
- Framing errors and their cost
- Narrow and broad framing
- Reframing exercises
- Framing workshops and their conduct
- Documenting the frame
- Testing the frame with the decision maker
Module 2 - Generating Alternatives
- Alternatives as the source of value
- Deliberate alternative generation
- Strategy tables
- Combining options across dimensions
- Technical alternatives
- Commercial alternatives
- Timing alternatives
- Exposure reduction alternatives
- Do nothing and relinquish options
- Screening alternatives
- Hybrid and staged alternatives
- Avoiding premature narrowing
Module 3 - Probability Assessment
- Probability interpretation
- Frequencies and subjective probabilities
- Elicitation techniques
- Anchoring and its avoidance
- Reference class and outside view
- Calibration and overconfidence
- Calibration testing and scoring
- Range estimation techniques
- Decomposition of complex probabilities
- Conditional probability assessment
- Documenting probability bases
- Improving team calibration
Module 4 - Trees and Influence Diagrams
- Decision tree construction
- Decision, chance and value nodes
- Tree structure and sequence
- Probabilities and their consistency
- Outcome valuation
- Rolling back and optimal policy
- Influence diagram construction
- Relationships and dependencies
- Converting between representations
- Tree size management
- Sensitivity analysis on trees
- Communicating tree results
Module 5 - Utility and Risk Preference
- Expected value as a criterion
- When expected value is appropriate
- Repeated decisions and the law of large numbers
- Large stakes relative to the organisation
- Risk aversion and its expression
- Utility functions
- Certainty equivalent
- Risk tolerance assessment
- Corporate risk appetite
- Exposure limits and their basis
- Risk sharing through equity
- Selecting the decision criterion
Module 6 - Value of Information and Control
- Value of information framework
- Perfect and imperfect information
- Information reliability assessment
- Calculating value of information from a tree
- Value of control concept
- Distinguishing information from control
- Data acquisition decisions
- Deferral and option value
- Cost of delay
- Sequencing data acquisition
- Information with no decision value
- Presenting the results
Module 7 - Sequential and Staged Decisions
- Sequential decision structure
- Learning between stages
- Staged development concepts
- Phase gate decisions
- Keeping options open
- Real options thinking
- Flexibility value
- Commitment and its cost
- Abandonment options
- Expansion options
- Decision policies rather than single choices
- Communicating staged strategies
Module 8 - Group Processes and Failures
- Group estimation effects
- Independent estimation before discussion
- Discussing differences rather than negotiating
- Facilitation of technical discussions
- Dissent and its preservation
- Red teams and devil's advocates
- Premortem exercises
- Common decision failures
- Analysis of the wrong question
- Sunk cost and escalation
- Advocacy presented as analysis
- Reviewing decision quality rather than outcomes
Upon successful completion of this training course, delegates will be awarded an official Certificate of Completion issued by the Petroleum Engineers Association (PEA), an ISO 9001:2015 certified training organization. The certificate carries 10 Credits and formally records the total learning hours completed.
Each certificate is signed by the Course Facilitator and the CEO of the Petroleum Engineers Association, and serves as verifiable proof of professional training that delegates can present to employers and professional bodies worldwide.
Frequently Asked Questions
All course bookings made through PEA are strictly non-refundable. By registering for a course, you acknowledge and accept that all fees are payable in full and are not subject to refund under any circumstances, including changes in personal or professional commitments or partial attendance.
PEA reserves the right to make reasonable adjustments to course content, trainers, or schedules where necessary, without entitling delegates to a refund. Comprehensive details of each course — including objectives, target audience, and content — are clearly outlined before enrolment, and it is the responsibility of the delegate to ensure the course's suitability prior to booking.
For any inquiries related to cancellations or bookings, please contact our support team, who will be happy to assist you.
