Financial Modeling for Oil and Gas

Course Code: AM.4
Dates for this course:

20 – 21 February 2017
21 – 22 June 2017
14 – 15 August 2017
13 – 14 November 2017

Subject: Financial Modeling for Oil and Gas
Course Fee: MYR 4,200

Who Should Attend?

  • Business & Finance Analysts
  • Finance Managers
  • Investment Analysts
  • Investment Managers
  • CFOs
  • Financial Modelers
  • Project Managers
  • Project Accountants
  • Investment & Corporate Bankers
  • Corporate Finance Managers
  • Finance Professionals
  • Accountants

Learning Objectives

  • Develop an excellent working knowledge of the most useful functions in Excel for financial modeling in the oil and gas industry.
  • Develop a sound understanding of oil and gas financial modeling and project evaluation concepts.
  • Gain experience in designing solutions to real-world financial modeling challenges and applying these to make investment decisions.

Course Content

Part 1:
Financial Modeling Principles & Practices
  • What is included in the scope of a financial model?
  • What makes a good spreadsheet model?
  • Types of O&G models during the lifecycle of an O&G project
  • Key O&G financial modeling principles: P10, P50, P90 reserves, demand drivers
Principles of Best Practice Financial Modeling
  • The 7 steps of financial model building
  • How to allow for uncertainty in O&G projects
  • Best practice guidelines and financial modeling standards
  • Compare and contrast functions, formatting and functionality
  • Designing for flexibility and scalability
  • Designing for consistency
  • Designing for usability and functionality
  • Designing checks and balances
  • Best practices for creating and displaying checks and balances
  • Using financial modeling standards
  • Compare different financial modeling standards
  • Examples of standards and how to apply these
  • Setting up Excel for efficient financial modeling
  • Learn the tips and techniques that will dramatically speed up the creation of your financial models
  • Using VBA in financial models
  • When is it appropriate & when is it not appropriate?
  • What things is it best suited for in financial modeling?
Case Study: Modeling with Standards
Identify the key components of a standardsbased modeling template

Part 2:
Applications of Financial Modeling
  • The role of project evaluation
  • Principles of discounted cash flow (DCF) modeling
  • Valuation of oil & gas projects
  • Overview of oil & gas tax regimes: concessionary, production sharing & services contracts. Introduction to modeling PSCs.
  • Economic limit and payback time. Depreciation modeling.
  • Investment indicators: WACC, RRR, NPV, IRR, VIR, Payback
  • Modeling uncertainty: sensitivity analysis, scenario analysis, and MCS.
  • Model optimization to consider constraints: tools and techniques
  • Presentation and interpretation of results: charts & presentations
  • Comparing and selecting projects: key charts and techniques
  • Using data from an offshore oil asset in the Northwest Shelf region of Australia, participants will work through a number of case studies to develop a full financial model from scratch.
  • Case Study Part 1: Model Scoping & Structure
  • Design and scope the model. What are the key outputs & sensitivities? How will the model need to be designed to provide these?
Case Study Part 2: Technical Data & Global Assumptions
Incorporate technical data from multiple cases, flexibility for future changes and ensuring reliability/robustness.
Case Study Part 3: Valuation
Bring together all the data to calculate the valuation, including converting from different currencies, real to nominal data, escalation factors, economic limit, abandonment charges, depreciation, and tax.
Case Study Part 4: Investment indicators
Calculate and sensecheck the outputs: charts, investment indicators.

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