Application of cost mathematical models to the determination of investments in the petroleum industry

It is today of paramount importance to realistically forecast the cost and time required to design and manufacture a given product, from the very first phase of the project. Furthermore, with the increasingly rapid development of technology, it is often impossible to draw a direct parallel with existing, well known products Mathematical models of cost, and MAP models in particular, have been developed to meet this need. Although one may still refer to former products, they do not automatically have to be 'analogous' to the product under consideration, because these methods use 'universal relationship' between cost, weight, technology, performance and reliability, and also the nature and experience of the firm manufacturing the product. The purpose of this thesis is to demonstrate the pertinence, and more importantly the potential, of mathematical models of cost for the oil and gas industry, from exploration and production to refining, petrochemicals, and internal combustion engines. After a theoretical examination of estimation methods and a classification of existing ones, emphasis is placed on the logical aspect of these models. In addition, the complementarity between these tools and certain fields such as project management is pointed out, for example with respect to value control. The last chapter of the thesis is devoted to case studies. It aims chiefly at comparing theory with practice in order to identify the limits of mathematical models of cost so that they can be used judiciously. (author)