B5: Financial Modelling For Oil & Gas

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B5: Financial Modelling For Oil & Gas 2017-09-27T13:17:03+00:00

B5: Financial Modelling for Oil & Gas (2-5 days)

This course covers oil and gas financial modelling and project evaluation concepts, combined with practical experience in designing solutions to real-world financial modelling challenges.

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What you get from this course

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

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Pre-requisites

Although not mandatory, attendees will get a lot more out this course if they complete some online training in Excel functions before attending.

We have partnered with Excel University to provide high-quality, low-cost online training and recommend their Volume 2 Course as good preparation for this course.  If attendees are a little less familiar with Excel, Volume 1 would also very useful.

Agenda Highlights

Bring Your Models!

Everyone’s models are different.  As such, participants are encouraged to bring along their own financial models to obtain assistance, ideas, guidance and suggestions from the trainer in private.

This is a key step in applying the concepts learned on the course to improve real-life models so please take the opportunity to draw on the trainer’s experience and expertise!

Advanced Excel for Financial Modelling

This workshop helps participants to get the most out of the remainder of the course. It covers key, advanced areas of Excel that are relevant to oil and gas financial modelling and project evaluation.

Here are just some of the areas we cover in our in-depth, hands-on workshop:

  • Working with large data sets
  • Summarising and aggregating data
  • Extracting data that matches criteria using flexible formulas
  • Error handling
  • Ways of improving structure
  • Techniques for keeping formulas consistent yet flexible
  • Combining and splitting cells according to the content they contain
  • Advanced techniques for creating automatically expanding charts and ranges
  • Introduction to macros & when to use these

We then apply and practise these functions during the remainder of the course.

Introduction to Financial Modelling for O&G

Financial Modelling Principles & Practices

Provides a sound understanding of financial modelling best practices and the practical application of these to real world situations.

Brief Introduction to Financial Modelling in O&G

  • What is a financial model?
  • What is included in the scope of a financial model?
  • What makes a good spreadsheet model?
  • Types of O&G financial models during the lifecycle of an O&G project
  • Key O&G financial modelling principles: P10, P50, P90 reserves, demand drivers

Case Study: What makes a good model?

Examine both good and bad practices in modelling
Principles of Best Practice Financial Modelling

  • The 7 steps of financial model building
  • How to allow for uncertainty in O&G projects
  • Best practice guidelines and financial modelling 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 modelling standards
    • Compare different financial modelling standards
    • Examples of standards and how to apply these
  • Setting up Excel for efficient financial modelling
    • 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 modelling?

Case Study: Modelling with Standards
Examine the key components of a standards-based modelling template

Case Study: Setting up Excel for Fast Financial Modelling
Exercise: Essential Excel Functions for Financial Modelling

Financial Modelling in Practice
Apply the principles learned to oil & gas project evaluations to improve skills in the practical application of project evaluation concepts.

– The role of project evaluation
– Principles of discounted cash flow (DCF) modelling

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 should be included/excluded?  What are the key outputs & sensitivities?  How will the model need to be designed to provide these?

Planning & Building the Model

Concepts:

  • Valuation of oil & gas projects
  • Overview of oil & gas tax regimes: concessionary, production sharing & services contracts
  • Overview of the Petroleum Resource Rent Tax (PRRT)
  • Introduction to modelling Production Sharing Contracts (PSC)
  • Economic limit and payback time
  • Depreciation modelling: straight-line, declining and units of production

Case Study Part 2: Technical Data & Global Assumptions
Incorporate technical data from multiple different technical cases, including summarising and re-organising the data, incorporating flexibility for future changes and ensuring reliability/robustness.  Allow for multiple different economic assumptions and incorporate the ability for the user to easily switch between these.

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 calculations.

Concepts:

  • Investment indicators: WACC, RRR, NPV, IRR, VIR, Payback

Case Study Part 4: Investment indicators
Calculate and sense-check the key outputs: charts, investment indicators.

Finalising, Presenting & Controlling the Model

Concepts:

  • – Modelling uncertainty using sensitivity analysis, scenario analysis, and Monte Carlo Simulation
  • – Model optimisation to consider constraints: tools and techniques available

Case Study Part 5: Scenarios & Sensitivities
Identify key risk areas and then incorporate sensitivity factors for these. Build a sophisticated scenario manager to run multiple scenarios and highlight the results.

Exercise: Building Monte Carlo Simulation into an Existing Model

Concepts:

  • Presentation and interpretation of results: charts & presentations
  • Methods for comparing and selecting projects: key charts & techniques

Case Study Part 6: Presentation
Learn how to present the results of the financial model to support management decision-making.

Control of Financial Models
Covers ways to detect and prevent errors from occurring.

Topics covered include:

  • Why audit financial models?
  • Excel’s auditing tools
  • Automated testing tools – role, purpose, limitations, demonstration
  • Model documentation

Case Study: Model Review
Identify errors, problems and inconsistencies within a sample model using the auditing functionality within Excel and key third-party tools.

Some of the Oil & Gas companies we have trained:

  • Apache
  • BHP Billiton
  • Carigali
  • Chevron
  • Clough
  • Eni
  • Hess
  • Inpex
  • KUFPEC
  • Mitsui E&P
  • Nippon
  • Oman Oil
  • Otto Energy
  • PTTEP
  • Pertamina
  • PetroVietnam
  • Petronas
  • Qatar Petroleum
  • Shell
  • Sinopec
  • Southern Oil Company
  • Strike Energy
  • Woodside

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Who should attend?

  • Business and Finance Analysts
  • Finance Managers
  • Investment Managers and Analysts
  • CFOs
  • Strategic Planning Analysts
  • Financial Modellers
  • Business Development Analysts
  • Investment and Corporate Bankers
  • Corporate Finance Managers
  • Finance Professionals
  • Project Managers
  • Accountants

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Facilitator: Jeff Robson

Masters (Applied Finance), BCom (Accounting & Information Systems), FAIM, F Fin, MAICD, CISA, MS Excel Expert

Jeff Robson is the Principal and Founding Director of Access Analytic, a specialist consultancy that focuses on financial modelling, forecasting, valuation, model auditing, and management reporting for clients throughout the world.

He is skilled in the development and maintenance of analytical tools and financial models for middle-market companies to large corporates, at all levels of complexity, in both domestic and international settings.

He has worked extensively with Chevron plus many other producers and explorers over many years.  He has trained oil and gas specialists from a wide variety of companies including Chevron, Woodside, BHP Billiton, Shell, Nippon Oil, National Iran Oil Company (NIOC), Southern Oil Company, Kuwait Petroleum Company, Petronas, PetroVietnam, Carigali, Hess, Mitsui, Strike Energy, Neon Energy, Nido, and Otto Energy.

He provides training in financial modelling for companies throughout the world.

Jeff is the author of a number of white papers on financial modelling on subjects such as Financial Modelling Best Practices and Financial Model Auditing.

Highlights from his oil and gas experience include:

  • Development of economic models to assist Decision Analysts modelling a wide range of scenarios for major oil & gas assets.
  • Auditing and development of 20-year strategic planning models for large oil & gas fields.
  • Development of business plan and budgeting models for oil & gas assets.
  • Development of cash flow, production-sharing and taxation models for oil & gas clients.
  • Consulting on spreadsheet remediation and risk assessment.

Feedback from Previous Participants

Feedback Initials & Position
“Training course very well conducted,very thorough. Lots of examples to work with, including completed examples to work on later & opportunity to work on an actual financial model.” L.S., Otto Energy
“Very good course. The hands on exercises.” C.F., Consultant, PwC
“No question was too “silly” to ask.” D.N., Corporate Finance Analyst, Clough
“The size of the course is fantastic, which allows for good discussion and sufficient attention. Good mix of Excel and industry/business information & knowledge.” WL.N, Manager, Mitsui E&P Australia
“Excellent information and practise exercises. The information was clearly presented and the practical application was very useful.” M.R., Otto Energy
“Given the complexity of the topic I thought the exercises, handout notes and pace were ideal.” D.C., Otto Energy
Highly recommend attending this course, Jeff Robson is very approachable and knowledgeable. C.M, Woodside
Challenging but very rewarding, enjoyed learning the importance of dynamic formulas. N.T, Woodside
Learning how to build a model from scratch has been very valuable. T.M, Woodside

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Benefits & Inclusions

Practical: Highly experienced facilitators who actively and regularly consult to clients also.
Applicable: apply what you learn to your job to further your career.
Hands-on: the course is designed to provide maximum hands-on experience.
Passionate: Our facilitators love this subject!
Clear: we specialise in translating complex subjects into concepts that are easy to understand.
On-going help: you can always e-mail the facilitator.
CD: includes worked examples, suggested solutions, reference materials, and a large variety of templates that can be immediately applied to kick-start your projects.
Comprehensive course notes.
Networking: meet industry peers and hear how they approach this subject.
Certificate of completion.
… and much more!

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Clients who have 3-4 or more people interested in this course normally prefer to run this course on an in-house basis in their offices.

We can bring all the equipment for up to 10 people so all you need is a room!

Benefits

  • Flexibility: we can combine content from multiple courses to create a custom course just for you, add-on a workshop or some mentoring sessions then run everything at the times that suit you.
  • Timing options: if you’re in Perth, we can split courses into half or single days and schedule these at times to suit you
  • No hidden extras: our fixed fee includes all materials and equipment costs for up to 10 participants
  • Cost effective: no extra fees for extra participants (maximum of 8 per session)

In-House Details & Pricing

  • Structure: half-day or full-day sessions
  • Location: all courses are available in-house, many are also available in open sessions
  • Provided: projector, laptops, manual, CD
  • In-house Fees: contact us today to discuss your requirements

In-house Course Fees

Call us on +61 8 6210 8500 to discuss your requirements.

Notes:
– We are happy to customise our courses to suit your requirements
A 10% discount applies when booking 10+ full days of training in any 30 day period
– Many courses can also be split into half-days (please enquire)
– Fees for locations outside of Perth do not include equipment

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