Corporate Finance in Oil and Gas Industry

Introduction

The global oil and gas industry is required capital that is in acceptable cost. However, due to some forces such as remote offshore operating conditions, uncertain reserve, high risks and increase of competition between companies has driven high investment and operating cost. So that oil and gas companies need more capital to develop project and longer periods to build new production facility. Therefore, financing, investment and profitability are important concerns of management in oil and gas company.

This training will provide a mix of theory and practice with the aim of equipping participants with a solid grounding in the core concepts of Corporate Finance in Oil and Gas Industry. Corporate Finance in Oil and Gas Industry covers Company Investment, Financing and Dividend principles. It will also analyse the tools needed to make appropriate financial decisions. Participants will be encouraged to select a corporate firm of their choice and use its financial statements for all the exercise activities designed in this training.

Aims

The aim of this module is to provide participants with both the theoretical underpinning and the analytical skills required to effectively evaluate corporate financial management decisions in Oil & Gas Industry; to enhance understanding in financing, investment and dividend principles; to apply the financial analysis tools; to apply the discount rate of project investment; to be able to calculate cost of capital from debt and equity; to familiar with oil and gas company profit and dividend options.

Outcome

On completion of this training, participants are expected to be able to:

1. carry out a comprehensive risk profile of a company.
2. calculate firm's weighted average cost of capital and to evaluate its capital structure.
3. recognize the factors behind firm's value.
4. evaluate firm's capital investment decisions.
5. appraise firm's dividend policy.

Topic Contents

Day 1

• General Opening
• Topic 1 Introduction to Corporate Finance
  • Separation of Ownership and Management, Agency Theory, Agency Costs
  • The main objective of financial manager in a corporate firm
  • Shareholder Value Framework
  • Firm's Lifecycle and Financial Decisions
• Topic 2
  The Investment Principle, The Financing Principle & The Dividend Principle
  • Investment principle
    • Project investment principle
    • Measure return
    • What would you choose as your investment
    • tool? - NPV, IRR,PP etc
  • Financing principle
    • Maximize the Value of the Firm,
    • Financing Mix
    • WACC calculation
  • Dividend principle
    • Use of free cash flow
    • Dividend policy /decisions
• Topic 3
  Oil and Gas Company Risk Profile
  • Basic Risk
  • Firm's Total Risk
  • Systematic Risk (Business + Financial Risk)
  • Reviewing Industry risk
• Topic 4
  Oil and Gas Company Financial Analysis ( ROS, Gross Profit Margin, ROA, ROE, ROIC,ROCE)
• Topic 5
  Exercise on Project Financial Analysis - Expected cash flow on Development Oil and Gas Project

Day 2

• Topic 6
  The Oil and Gas Financing : Overview of Balance Sheet, Income Statement and Statement of Cash Flow
  • Basic balance sheet
  • Funding the oil and gas company
  • The oil and gas company income statement
  • Cash flow of oil and gas company
  • Reviewing one of Oil and Gas Company
• Topic 7
  The Oil and Gas Financing : Managerial Balance Sheet, Cash, Net working Capital
  • Managing Cash in Oil and Gas Company
  • Managing Net working capital
  • Managing net fixed asset
  • Invested capital
• Topic 8
  The Oil and Gas Capital Sourcing - Debt & Equity
  • Equity
  • Debt
  • Net Debt to Capital
  • Oil and Gas Industry review of net debt
• Topic 9
  Cost of Capital & Discount Rate to financing Oil & Gas Project
  • Cost of Debt
  • Cost of Equity
  • WACC Calculation
  • Corporate hurdle rate
  • Project Discount rate

Day 3

• Topic 10
  Exercise for Company Cost of Capital, Corporate Hurdle Rate & Project Discount Rate calculations
  • Reviewing one of Oil and Gas Company Financial Report
  • Impact of cost capital to NPV or IRR project
• Topic 11
  The Dividend in Oil and Gas Industry - Profit characteristics & Dividend Calculation. Dividend Policy and alternative options.
  • Dividend Principle
  • Dividend Calculation
  • Retain or Payout
  • Reviewing one of Major Oil Company Dividend History
• Question and Answer
• Summary

Training Duration: 3 Days

Participants:

- Decision Maker or Executives Management in Oil & Gas Industry
- Finance or Accounting staff who working in Oil & Gas Industry and Energy sector
- Employees in Oil & Gas or Petroleum or Energy that interest in Corporate Finance of Oil & Gas company
- Other participants working in or related to Oil & Gas Industry that interested in Corporate Finance

Jumlah Peserta

• Minimal 2 orang peserta

Fasilitas

• Modul pelatihan dalam bentuk softcopy
• Sertifikat pelatihan dalam bentuk softcopy (e-certificate)
• Bila membutuhkan hardcopy sertifikat, akan dikirimkan lewat jasa kurir.
• Souvenir, selama persediaan masih ada.

Course Leader :

Expert Trainer

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