BUEC 363 Introduction to Energy and Resource Industries Syllabus
Winter Semester, 2020
Instructor: Hailing Zang
Office Hours: Tuesday and Thursday afternoons 1:30 – 3:00 pm Email: [email protected]
Office: BUS 340-C Phone: 780.492.7720
1. Course Overview
This course provides an overview of the oil, natural gas and electricity industry. These industries are the fundamentals to daily activities of nowadays world. The prices in those industries are intrinsic to prices of other commodities and even to the economy well beings of a nation. This course outlines the upstream (for example, oil exploration and production) and downstream (for example, the gasoline market) of the oil and natural gas industry. It also provides a deeper look at the world oil and natural gas market. For the electricity industry, this course provides a detailed discussion of the deregulated electricity market: how the market functions and how the submarkets are related with each other. The course also provides the most updated special topics in the electricity market.
2. Course Expectations
After finishing this course, students should have fundamental understandings of the functions and operations of the oil, natural gas and electricity industry and markets. They should be able to apply fundamental economic theories to the understanding of each market, as well as to the environmental implications in each market. They should also be able to follow up with today’s changing in regulations and industry activities.
3. Recommended textbooks
There are no required textbooks for this class, however, having some good textbooks at hand will help better understand the course in a more systematic way.
Electricity Industry
“Power System Economics”, Steven Stoft, ISBN 978-0-471-15040-4, IEEE Press
Oil and Natural Gas Industry
“Oil and Gas for Beginners”, Deutsche Bank Market Research
“Modern Shale Gas Development in the United States: A Primer”, U.S. Department of Energy, Office of Fossil Energy, 2009.
“Gasoline Pricing: Theory and Evidence” Scherer, Industry Structure, Strategy, and Public
Policy, pp. 122-126.
“Vertical Relationships and Competition in Retail Gasoline Markets: Empirical Evidence from Contract Changes in Southern California,” Hastings, American Economic Review, 2004.
“How Economists See the Environment”, Fullerton and Stavins (1998), Nature, October 1, pp. 433-434.
Microeconomics
“Microeconomics”, by Pindyck and Rubinfeld
4. Prerequisite
There is no prerequisite for this course, however, students with basic microeconomics knowledges will have better understanding of the course. I will outline the economic basics in the course where necessary. For those who have interests in better understanding the economic principles behind the policies and market functions, please refer to the microeconomics textbook referred in the “required textbook” section.
This course is NOT to be taken by students with credit in BUEC 463.
5. Evaluations
Quizzes (20%)
There will be 4 quizzes during the semester. The quizzes will be on Fridays (see Course Outlines). The quizzes are to help reinforce the knowledge that was taught. Each quiz is 5% of your total mark.
If a student has a valid excuse for missing a quiz and explained to the instructor in writing BEFORE the quiz, the quiz weight is assigned to the nearest exam. However, no excuse will be accepted AFTER the quiz is administered and no makeups for the quiz.
Class presentations (40%)
There will be two class presentations, one during the midterm period and the other during the final period of the course. The presentation will be done in groups and we will decide on the size of the group after the number of students are settled in class. The presentations should be a discussion of any interesting topics you find relating to oil, natural gas and electricity industry. It can be a news discussion, a policy discussion, or even some statistical analysis that you perform based on observations that you have made. Each class presentation will be 20% of your total mark.
Within the 20%, 5% will be for submitting the presentation on time. No late submission of the class presentation will be accepted and no excuses will be accepted.
If your group have a preferred date of presentation, please notify the instructor as early as possible. Usually with well advanced notification, the presentation date can be well
organized among students. However, no excuse for missing presentation will be accepted AFTER the presentation is over and no makeups for the presentation.
Due date for first presentation submission date: Feb 23 11:59 pm;
Due date for second presentation submission date: March 31 11:59 pm.
First class presentation period: Feb. 24 – Feb. 28;
Second class presentation period: Apr. 1 – Apr. 6
Rubrics of Presentations:
- Whether key points are clearly delivered or not - Whether the topic is current or not
- Whether the discussion has data and fact supports
- How’s the quality of the presentation (flow, organization…) - Whether questions are answered well enough
Exams (40%)
There will be two exams during the semester. The two exams are NOT cumulative. The first exam will cover the electricity industry and the second exam will cover the oil and gas industry. All the exams will be closed book exams. Each exam is worth 20% of your total mark.
Missing Exams: if you have either 1) an emergency coming up ON the exam date or, 2) if you have already booked an air ticket on the exam date BEFORE the FIRST day of class, with valid written excuses and with supporting documents submitted to the lecture, you are allowed to submit an individual research paper as a makeup work.
First exam: March 2 in class;
Second exam: April 8 in class, the last day of class.
Letter Grade
The final letter grade will depend on your relative performance among the class, I will announce the letter grade cutoff marks after the last exam is marked. The distribution of the letter grade will follow the school guided distributions:
Again, there is no makeup or extra class work to improve your mark.
6. The Code of Student Behavior
The University of Alberta is committed to the highest standards of academic integrity and honesty. Students are expected to be familiar with these standards regarding academic honesty and to uphold the policies of the University in this respect. Students are particularly urged to familiarize themselves with the provisions of the Code of Student Behavior (http://www.uofaweb.ualberta.ca/gfcpolicymanual/content.cfm?ID_page=37633) and avoid any behavior which could potentially result in suspicious of cheating, plagiarism, misrepresentation of facts and/or participation in an offence. Academic dishonesty is a serious offence and can result in suspension or expulsion from the University.
7. Course Outlines (Important dates are in bold)
Week 1 - 2: Electricity market overview
Week 2 - 3: Electricity market architecture (Quiz) Week 4 - 5: Locational Price, Hedging tools
Week 5 - 6: Ancillary service markets and special topics in electricity market (Quiz) Week 7: Reading Week
Week 8: Class Presentation March 2: EXAM I
Week 9: History of oil and natural gas market Week 10: Oil and natural gas industry basics (Quiz) Week 11: Oil and natural gas industry structures Week 12: World oil and natural gas markets (Quiz)
Week 13: Class Presentation Apr. 8: Exam II
We will have various guest speakers coming during this course as well depending on their availability. I will update the dates of guest speakers during the semester of the course.
