Short Courses and Conferences

Using Dynamic DCF and Real Options to Value and Manage
Mining and Petroleum Projects

June 10-12, 2015

Course Description

Recent advances in finance theory and risk management have heavily influenced investment decision-making in the finance and insurance industries. Building on the discounted cash flow (DCF) technique, these advances allow valuation professionals to improve their economic and risk analysis via sophisticated cash flow models that combine dynamic descriptions of uncertainty with the ability to manage these uncertainties using flexible design and operational strategies. Non-financial industries, such as power generation and pharmaceuticals, are now applying these concepts to generate new investment insights and improve project analysis and management.

Mining and petroleum projects are ideally suited to these same techniques and many natural resource firms are beginning to incorporate these ideas into their project valuation and management practice.

This three-day course on Using Dynamic DCF and Real Options to Value and Manage Mining and Petroleum Projects will combine an innovative hands-on instruction style and real-world case studies to teach you how to:

  • Use these new concepts to develop a consistent, market-based valuation approach that can differentiate and value different projects and different project designs according to their unique cash flow uncertainty and risk characteristics
  • Identify important elements of project structure, such as management flexibility and operational costs, and understand how they influence project value
  • Examine how the terms of taxation and finance distribute project uncertainty and risk between equity, government, and creditor cash flow streams and how this affects the value and return of each stream
  • Move from using a conventional valuation approach based on a static cash flow model and ad-hoc approaches to adjusting for and valuing risk to a dynamic valuation approach that can more fully represent the variability of the mining and petroleum project environment and the options that may exist to limit and take advantage of that variability
  • Build confidence with practical examples so you can adapt these methods to a wide range of projects and situations

Who Should Attend

The course is designed for mining and petroleum industry managers, geologists, engineers, bankers, analysts, and government officials involved in evaluating, designing, or managing projects or dealing with investment risk.

Participants do not require advanced mathematical skills to understand and apply the course material. However, to get the most from the course, they should be familiar with:

  • Basic statistical concepts such as variance, standard deviation, and covariance
  • Constructing a traditional discounted cash flow valuation
  • Introductory financial concepts such as the time value of money and risk-adjusted discounting


Dr. Michael Samis, P.E., is a leading Dynamic DCF and Real Options practitioner in the natural resource industries. He has extensive professional experience valuing base metals, precious metals, diamond, and petroleum projects with complex forms of flexibility and risk. Learn more...

Dr. Graham A. Davis is Professor of Economics and Business at the Colorado School of Mines. Dr. Davis has a bachelor’s degree in Metallurgical Engineering, an MBA, and a Ph.D. in mineral economics. Learn more...

Course Topics and Material

A listing of the primary topics of the course and information about the course material are available. Learn more...


A typical agenda for the course is available. Learn more...


All sessions of this course will be held in the offices of Ernst & Young LLP at the following address:

Ernst & Young Tower
222 Bay Street
Toronto, ON M5K 1J7 Canada.

A map showing this location is available. Get map...

Fees and Registration

Registration for this course is open now. Enrollment is limited; therefore, applications will be accepted in the order received. Full information about fees, options, and payment methods is available. Learn more...

Travel and Accommodations

Registrants are responsible for their own travel arrangements, transportation, lodging, and meals. Additional information is available through the links listed below.

Further Technical Information

For more information about the course content, please contact:

Dr. Graham Davis

Dr. Michael Samis

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