MASTERCLASS:                                                    ADVANCED &                                                ...
COURSE      CONTENT      ALL SESSIONS WILL BE      THEORY AND PRACTICAL BASED      Participants should bring their calcula...
COURSE      CONTENT      ALL SESSIONS WILL BE      THEORY AND PRACTICAL BASEDDAY3 ADVANCED CAPITAL BUDGETING AND RISK     ...
COURSE       CONTENTDAY5 ADVANCED TOPICS IN INTERNATIONAL                                                     WHY THIS EVE...
MASTERCLASS:ADVANCED &                                                                                            REGISTRA...
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Masterclass: Advanced & Expert Strategies In Oil & Gas Finance And Accounting 05 - 09 March 2012 Marbella Spain

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Finance and accounting is one of the core management functions in all organizations. The maximisation of financial resources may be the key factor for success. However, in the oil & gas industry, the rapid changes in geopolitical and economic climate has brought forth a growing need for change in regulatory framework regarding environmental, governance and reporting issues.

It is crucial that leaders in the oil & gas industry be equipped with wide-ranging knowledge in finance & accounting to achieve strategic planning & decision-making.

This training will benefit your organization by giving delegates greater knowledge on best practices to make better decisions in oil & gas finance and help their organization reach new heights.

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Masterclass: Advanced & Expert Strategies In Oil & Gas Finance And Accounting 05 - 09 March 2012 Marbella Spain

  1. 1. MASTERCLASS: ADVANCED & EXPERT STRATEGIES IN OIL & GAS FINANCE AND ACCOUNTING 05 - 09 MARCH 2012FINANCE HOTEL FUERTE MARBELLA Limited SeatskSERIES Boo Available. Today! SPAIN ats Your Se WHY YOU CANNOT MISS THIS EVENT YOUR INT YOUR INTERNATIONAL Finance and accounting is one of the core management functions in all COURSE FACILITATOR organizations. The maximisation of financial resources may be the key factor for Betty J. Simkins, Ph.D. success. However, in the challenging oil & gas industry, the rapid changes in geopolitical and economic climate has brought forth a growing need for change in Professor of Finance regulatory framework regarding environmental, governance and reporting issues. Oklahoma State University It is crucial that leaders in the oil & gas industry be equipped with wide-ranging Betty J. Simkins, Ph.D., is the Professor of Finance in the knowledge in finance & accounting to achieve strategic planning & decision-making. Department of Finance at Oklahoma State University’s This will give them a boost in achieving long term success. Spears School of Business where she teaches, corporate There is a need for the demonstration of risk identification and financial finance, energy finance and risk management, advanced financial management, corporate valuation, and case management to be grounded in timely, accurate forecasts and performance data. studies in finance. She frequently presents her research at These have caused the industry to be one of world most challenging and complex leading academic conferences around the world. Prior to business environment. entering academia, she worked in the energy industry for ConocoPhillips, Williams, Inc., and Williams Pipeline Company, among others. “Excellent coverage of financial forecasting, risk analysis, and planning.” Dr. Simkins has also worked as a consultant or advisor for Wells Fargo, ConocoPhillips, Deloitte Touche, Morgan Stanley, Conference Board of Canada, the National - ConocoPhillips Association of Security Dealers (NASD), Southwest Airlines Company, Williams, Inc, and EKF (Eksport Kredit Fonden, Denmark). She is frequently interviewed and quoted in Key reasons why your organization would benefit from this course: the press regarding her research and expertise on energy Establish crucial insights of the oil & gas industry’s current and future prospect finance, including such publications as the Wall Street Journal, the Chicago Tribune, and the Houston Chronicle. Improve key analytical skills and techniques in oil and gas capital budgeting Her research was recently used in testimony to the U.S. and project evaluation including risk analysis for better decision-making and Senate Banking Committee. strategic planning She has over 50 publications in academic & practitioner journals and has won awards for her risk management Review the critical issues related to International Financial Reporting research. She has a 2012 forthcoming book, “Energy Standards (IFRS) and International Accounting Standards (IAS) and its Finance and Economics: Analysis and Valuation, Risk application in oil & gas companies Management, and the Future of Energy”, which will be published by Wiley. Her 2010 book, “Enterprise Risk Understand the most important issues related to valuation of oil & gas prices & Management: Today’s Leading Research and Best properties under current and proposed international accounting standards Practices for Tomorrow’s Executives”, is a Wiley top seller. Her publications rank her in the top 5 percent of finance Manage and mitigate risks effectively researchers. In addition, Dr. Simkins has won a number of teaching awards including the highest at OSU, the Gain knowledge on derivatives and hedging due to the complexity of the Regents Distinguished Teaching Award. Her current industry research and consulting focuses on the oil and natural gas industries, energy finance, enterprise risk management, and energy risk management. “Great course that gives me the good ideas in financial She currently serves on the Board of Directors for the accounting strategies which will help me in my work.” Financial Management Association, as co-editor of the Journal of Applied Finance, as Editor of FMA Online, as past president of the Eastern Finance Association, and on - Ministry of Oil & Gas Oman the editorial boards of several prestigious finance journals. “Most teachers are passionate about what they teach: however, Dr. Simkins has raised the bar for her peers by bringing the real world into the classroom.” - Ernst & Young, Inc. © 360 BSI (M) Sdn Bhd (833835-X), Level 8 Pavilion KL, 168 Jalan Bukit Bintang, 55100 Kuala Lumpur, Malaysia. 1
  2. 2. COURSE CONTENT ALL SESSIONS WILL BE THEORY AND PRACTICAL BASED Participants should bring their calculators to all 5 days of the course. It is highly recommended that participants also bring laptops on Days 2, 3 and 4 for the practical exercises.DAY1 BUDGETING AND FORECASTING STRATEGIES IN THE OIL AND GAS INDUSTRY Session One: DAY2 Laying the foundation -- Global energy outlook, supply and demand balance brought about by a rapidly changing world OPTIMIZING BUDGET MODELS Setting the stage for finance and accounting strategies for oil & gas companies Global energy outlook AND CAPITAL INVESTMENT Energy supply and demand issues Current views on energy price projects ANALYSIS Human capital shortages, unproven technology & unknown geology Session One: Future trends of oil and gas Analysis of international oil companies financial statements – Part 2 Session Two: Delegates will analyze the financial statements of How oil and gas companies differ from other industries and key issues in oil leading international oil companies. and gas accounting and finance - Case studies and Excel applications To understand the financial prospects of an oil and gas company, one must - Bloomberg applications understand how they differ from other industries and key issues related to reporting. Session Two: Special accounting treatment for Oil and Gas companies Competitive benchmarking Analyzing the different accounting methods and financial statements This session will cover the critical topic of competitive Determining the proper classification of oil and gas costs: capitalize, expense, benchmarking. What is this? exploration costs, development costs, production costs Revenue recognition: when is it revenue and when it is not? Competitive benchmarking – an understanding of Fair value accounting issues how well a company is doing relative to other Industry accounting issues companies. These are performed to identify individual investment, institutional investment, Session Three: employment, benchmarking, and Merger and Acquisition potential. Observing the role of International Accounting Standards (IAS) and future issues as they apply to Oil and Gas companies When companies compare themselves to their peers, Overview of critical issues related to international petroleum accounting they usually have a number of significant advantages Observing the role of International Accounting Standards (IAS) in the future of over outsiders. financial statements for oil and gas companies - Where they came from Session Three: - What does it mean to companies now and in the future Capital budgeting and risk analysis in the Oil and Value chain and significant IAS accounting issues Gas industry Upstream Oil and Gas specific differences between IAS and U.S. GAAP Valuation of Oil and Gas assets is a critical and challenging process. The uncertainty of production, Session Four: prices, capital costs and construction delays, among Analysis of international oil companies financial statements – Part 1 other factors, makes it difficult to value projects. In this session, leading analytical skills and techniques This two-part session will continue with topics covered in the prior session on used in Excel will be discussed and illustrated using IAS by applying them to financial statement analysis. real case studies on financial forecasting and analysis. Delegates will learn 10 important factors in reading and analyzing the financial Recap of traditional capital budgeting methods statements of international oil companies. The main focus will be on learning - Net present value (NPV), internal rate of return (IRR), how to analyze the company’s success in exploring and producing oil and gas modified IRR, payback period and discounted reserves and understanding the concept of competitive benchmarking of the payback period company against other energy companies. Advanced analytical skills, techniques, and challenges This session is helpful in gaining knowledge as a business professional working in oil and gas capital budgeting including: in the energy industry, a potential investor or lender in the oil and gas industry - Oil and gas production, oil and gas prices, cost of and an individual seeking employment in this industry. Delegates will analyze capital, construction costs, and startup delay the financial statements of a leading international oil company. Session Four: Case study applications and open discussion of Topics covered include: crucial issues Energy ratios specific to oil and gas companies Participants will analyze case studies of actual Reading oil and gas reserve disclosures international firms operating in the oil and gas Analyzing production replacement and reserve replacement industry to further explore issues covered in the Analyzing finding costs and reserve replacement costs sessions covered today. Attendees will also have the Reserve life index opportunity to discuss crucial issues facing them with Key profitability indicators delegates in attendance. Open discussion will follow with suggestions and recommendations. This is an excellent opportunity to interact in a stimulating “Very beneficial course.” group setting with other participants. - PTT Exploration & Production, Bangkok, Thailand 2
  3. 3. COURSE CONTENT ALL SESSIONS WILL BE THEORY AND PRACTICAL BASEDDAY3 ADVANCED CAPITAL BUDGETING AND RISK ANALYSIS IN THE OIL & GAS INDUSTRY Session One: Advanced capital budgeting and risk analysis in the Oil and Gas industry Would you like to master financial forecasting and analysis? If so, this session is a “must” in gaining the cutting-edge skills necessary for sophisticated financial analysis and modeling of oil and gas projects. In this session, Monte Carlo DAY4 simulation will be used to model uncertainty for key value drivers of large oil and gas projects. Monte Carlo simulation is a powerful tool that can help evaluate what can happen to an investment’s future cash flows and summarize ADVANCED TOPICS IN the possibilities in a probability distribution. This is particularly helpful in oil VALUATION OF OIL AND GAS and gas project analysis since the outcomes from large investment projects are often the result of the interaction of a number of interrelated factors (or value COMPANIES drivers) that are highly uncertain. Session One: Risk analysis of oil and gas projects using Excel Valuation of Oil and Gas companies using relative - Sensitivity analysis, sensitivity charts, and scenario analysis valuation using market comparables – Part 1 Introduction to relative valuation for oil and gas Advanced risk analysis using Monte Carlo simulation companies - Distribution fitting and correlation assumptions Valuation of oil and gas companies using the Method - 5 basic rules of thumb in choosing probability distributions of Comparables - Three popular probability distributions for use in simulation models Valuing an IPO - Displaying and understanding output -- Tornado Charts, etc Most commonly used valuation ratios (multiples) and DCF valuation techniques for oil and gas companies Modeling energy prices in capital budgeting risk analysis Enterprise valuation using EBITDA and EBITDX - Techniques and challenges in modeling energy prices multiples - Modeling energy prices using mean reverting processes incorporating Poisson EBITDA and firm free cash flow jumps Why use EBITDA/EBITDX multiples rather than cash flow multiples? Case studies and Excel applications Session Two: Session Two: Valuation of Oil and Gas companies using relative Case study applications and open discussion of crucial issues related to valuation using market comparables – Part 2 advanced capital budgeting and risk analysis Valuing a privately held firm Delegates will analyze case studies of actual international and Middle Eastern firms The effect of risk and growth potential on valuation operating in the oil and gas industry to further explore issues covered in the sessions multiples covered today. Attendees will also have the opportunity to discuss crucial issues Adjusting the multiple valuation metric for the facing them with delegates in attendance. Open discussion will follow with private oil and gas firm discount suggestions and recommendations. This is an excellent opportunity to interact in a Equity valuation of an oil and gas firm using the stimulating group setting with other participants. price-earnings (PE) multiple Valuing a division using the PE method – example for Session Three: Exxon Mobil’s Chemical Division Current issues about derivatives and risk management in the Oil and Gas Case study applications industry Oil and gas companies are facing many financial risks currently and risk Session Three: management is a critical issue for these firms. Risk management encompasses Case Study: Valuation of ExxonMobil’s Acquisition the identification and assessment of the risks that materially affect company of XTO Energy using Relative Valuation value and enterprise risk management addresses the implementation of a company-wide strategy to manage those risks. Session Four: Open discussion of crucial issues from Days 1 In this session, participants will learn about the following topics: through 4 - What do we mean by risk management and why do firms manage risks? In this final session of day 4, delegates will have the - How hedging can increase firm value opportunity to further explore issues covered in the - Introduction to terminology and instruments used in the energy derivatives course. Attendees can choose cases to analyze that markets most closely match their areas of interest and will - Energy price volatility, types of derivative markets have the opportunity to work in a stimulating group - Lessons from hedging mistakes: Recent hedging disasters setting with other participants. Delegates can share experiences, make suggestions, and query the group for their insights on topics of high concern in the oil Session Four: and gas industry. This is an excellent opportunity to Advanced topics in hedging and risk management interact with other delegates in a stimulating group Do you need more knowledge or want to learn more about derivatives and setting with other participants. hedging in this complex industry? If the answer is yes, this session is a must for you. Topics covered include: - Hedging, basis risk, and factors affecting basis - Petroleum and natural gas price risks and risk management strategies “… her discussion, in-depth knowledge, and - Options (calls, puts, collars, floors, caps) cases used were very effective. Great - Energy swaps course!” - Value-at-Risk (VAR) and Cashflow-at-Risk (CAR) - The Greeks (delta, vega, theta, rho, and gamma) and what they mean - Reliance Industries Limited (Oil & Gas, India) - Energy trading 3
  4. 4. COURSE CONTENTDAY5 ADVANCED TOPICS IN INTERNATIONAL WHY THIS EVENT ACCOUNTING STANDARDS AND US GAAP This workshop gives delegates crucial insights on the oil & gas industry’s current and future FOR OIL AND GAS COMPANIES prospects. Session One: Accounting for Hedging Under IFRS – IAS 39 and US GAAP Participants will develop key analytical skills & Financial Accounting Standards (FAS) 133 techniques in oil & gas capital budgeting, project What are the current accounting standards as they relate to risk management? evaluation, risk analysis & strategic planning. In this session, we will discuss these very issues as they relate to US GAAP and This course will also review the critical issues IAS. related to IFRS and IAS and its application to the Topics included cover: oil & gas industry. Vital knowledge of derivatives - How should a company account to its shareholders for the derivatives it and hedging will also assist in risk management holds? & mitigation. - Example of a speculating position and hedging position The trainer, through years of experience in - FAS 133 and IAS 39 (fair value hedge, cash flow hedge, speculative finance and the oil & gas industry, will conduct a transaction) including definition of hedges, accounting of hedges, and dynamic and resourceful training that you won’t criteria for hedging want to miss! - Measuring hedge effectiveness under FAS 133 and IAS 39. - How should a company account to its shareholders for the derivatives it The combination of interactive presentations, holds? hands-on exercises and open discussion groups along with real case studies, ensures you will Case study illustrations on risk management applications and mistakes in obtain maximum value from attending. the Oil and Gas industry Session Two: Case study applications in hedging and risk management for oil and gas and accounting applications Session Three: Accounting for production costs and company evaluation Production costs refer to the costs incurred in the production phase. Typically these costs include the cost of producing or lifting the oil and gas to the surface, field treatment, field transportation, gathering, and storage. In this session, accounting for production costs will be covered. Topics covered include: - Typical production costs - Allocation of production costs - Crude oil production - Gas production - Performance measurement and evaluation - Revenue determination in joint operations Case examples Session Four: Course wrap-up In this final session, delegates will have the opportunity to further explore WHO SHOULD ATTEND issues covered in the course. Finance Managers and Directors Finance Controllers Accounting Managers Public Accountants & Auditors Financial & Business Analysts Staff Accountants in a Leadership Role Key personnel in the oil & gas industry “That is what learning is. You suddenly understand something youve understood all your life, but in a new way.” COURSE SCHEDULE 8.00 Registration & Coffee/Tea - Doris Lessing 8.30 Workshop commences 10.30 - 11.00 Morning coffee/tea 12.30 - 13.30 Lunch 15.00 - 15.30 Afternoon coffee/tea 16.30 End of day 4
  5. 5. MASTERCLASS:ADVANCED & REGISTRATION FORMEXPERT STRATEGIESIN OIL & GAS Fax: +603 9205 7788FINANCE ANDACCOUNTING Tel: +603 9205 7778 Mobile: +6016 3326 36005 - 09 MARCH 2012 Email: kris@360bsi.comHOTEL FUERTE MARBELLASPAIN DELEGATES IN-HOUSE TRAINING 1 Name : 360 BSI is passionate about providing strategic technical programs and high potential training solutions across the Name on tag : region to build personal competencies and organizational Job Title : capability. You will receive practical training from a professionally Email : qualified educator with over twenty years of teaching and Mobile training experience. : Please feel free to mix-and-match topics from the areas listed 2 Name : below to get the right training content for your staff. Other topics may be available upon request. Name on tag : OTHER PUBLIC COURSES Job Title : o 360 Train the Trainer Email : Finance & Capital Investment Analysis Root Cause Analysis Mobile : Business Proposal & Report Writing Record & Document Management 3 Name : Business Communication & Presentation Skills Name on tag : Resilience - Thriving in Challenging Times Job Title : Hotel Contact Details: Email : For Room Reservation, contact us for our corporate rates. Mobile : Hotel Fuerte Marbella Avda. El Fuerte s/n. 29602. Marbella (Málaga). España Telephone: +34 95 286 15 00 AUTHORIZATION (This form is invalid without a signature) General Information: Name : 1 Closing date for registration is 27th February 2012. 2 The fees cover lunch, tea breaks, materials and certificate. Job Title : 3 Official confirmation will be sent, once registration has Email : been received. 4 Participants will need to arrange their own accommodation. 5 Attire: Smart Casual Tel : ( ) Cancellations/Substitutions Organization : Substitutions are welcome at any time. Please notify us at Address : least 2 working days prior to the event. All cancellations will carry a 10% cancellation fee, once a registration form is received. All cancellations must be in writing by fax or email at least 2 weeks before the event date. Cancellations with less than 2 weeks prior to the event date carry a 100% liability. However, course materials will still be couriered to you. Signature : Date: / / Thank you for your registration! COURSE FEES (please tick as appropriate) PAYMENT DETAILS Payment is required within 5 days upon receipt of USD 4,495 per delegate the invoice. USD 4,200 per delegate - register before 15-DEC-2011 Bank transfer: 360 INTERNATIONAL LIMITED Standard Chartered Bank P.O.Box – 999 Al Fardan Building, Al Mankhool Area, Bur Dubai, Dubai, U.A.E The fee does not include any taxes (withholding or otherwise). In case of any taxes applicable Account No: 02-2077311-01 USD the client has to ensure that the taxes are paid on top of the investment fee paid for the course. Compliance with the local tax laws is the responsibility of the client. Swift No: SCBLAEADXXX * Save up to 50% for In-house Training program All payments must be received prior to the event date © 360 BSI (M) Sdn Bhd (833835-X), Level 8 Pavilion KL, 168 Jalan Bukit Bintang, 55100 Kuala Lumpur, Malaysia. www.360bsi.com 5

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