Financial Modelling for Oil and Gas Companies Training Course

Module 1: Introduction to Oil and Gas Financial Modelling

• Core principles of best practice financial modelling in the energy sector
• Structure and flow of a standard upstream financial model
• Key differences between oil and gas modelling vs. general corporate finance
• Design and setup of the inputs, calculations, and output sheets
• Practical session: Setting up the model framework and defining global assumptions

Module 2: Accounting and Revenue Modelling in Upstream Projects

• Modelling production profiles including decline curve analysis
• Price forecasting techniques for Brent, WTI, and natural gas benchmarks
• Detailed calculation of gross revenue and netback pricing
• Handling inventory, lifting, and over/under-lift accounting
• Practical session: Building a dynamic revenue engine based on varying production volumes

Module 3: Operating and Capital Expenditure (OPEX and CAPEX)

• Categorizing exploration, development, and production costs
• Modelling fixed vs. variable operating costs in oilfield services
• Treatment of abandonment and decommissioning (ARO) provisions
• Escalation and inflation adjustments for long-term projects
• Practical session: Creating a capital expenditure schedule with depreciation hooks

Module 4: Taxation, Royalties, and Production Sharing Contracts (PSCs)

• Understanding the mechanics of Royalty/Tax vs. PSC systems
• Calculating cost oil, profit oil, and government take splits
• Modelling corporate income tax and supplemental petroleum taxes
• Handling ring-fencing rules and tax loss carry-forwards
• Practical session: Building a PSC waterfall for a deepwater exploration project

Module 5: Financing and Debt Modelling

• Modelling project finance structures and debt sizing constraints
• Calculation of interest during construction (IDC) and commitment fees
• Debt sculpting techniques using Debt Service Coverage Ratios (DSCR)
• Creating a robust debt draw-down and repayment schedule
• Practical session: Integrating a debt facility with a circularity-free interest calculation

Module 6: Valuation Techniques and Discounted Cash Flow (DCF)

• Deriving the Weighted Average Cost of Capital (WACC) for energy firms
• Calculation of Unlevered vs. Levered Free Cash Flows
• Terminal value assumptions for finite-life natural resource assets
• Enterprise value to equity value bridge for oil and gas companies
• Practical session: Performing a DCF valuation on a producing oil asset

Module 7: Risk Analysis and Sensitivity Testing

• Identification of key value drivers: Price, Volume, and CAPEX
• Building data tables for one-way and two-way sensitivity analysis
• Scenario manager setup for "Base Case," "Upside," and "Downside"
• Introduction to Monte Carlo simulation for geological uncertainty
• Practical session: Developing a dynamic dashboard for sensitivity results

Module 8: Midstream and Downstream Financial Dynamics

• Modelling pipeline tariff structures and throughput fees
• Refinery margin analysis and crack spread calculations
• Storage and transportation cost integration in the value chain
• Working capital requirements for downstream distribution
• Practical session: Building a midstream cash flow component for a gathering system

Module 9: Investment Decision Metrics

• Calculating Net Present Value (NPV) and Internal Rate of Return (IRR)
• Understanding the Profitability Index (PI) and Maximum Cash Exposure
• Payback period and discounted payback period analysis
• Using hurdle rates and capital rationing techniques
• Practical session: Creating an investment summary report for executive approval

Module 10: Model Auditing and Final Review

• Common errors in oil and gas models and how to spot them
• Using Excel’s auditing tools and third-party software for error checking
• Ensuring model integrity and user-friendly documentation
• Final stress-test of the complete integrated model
• Practical session: Peer-review and "stress-test" audit of a completed financial model

Requirements:

• Participants should be reasonably proficient in English.
• Applicants must live up to Armstrong Global Institute admission criteria.

Terms and Conditions

1. Discounts: Organizations sponsoring Four Participants will have the 5th attend Free

2. What is catered for by the Course Fees: Fees cater for all requirements for the training – Learning materials, Lunches, Teas, Snacks and Certification. All participants will additionally cater for their travel and accommodation expenses, visa application, insurance, and other personal expenses.

3. Certificate Awarded: Participants are awarded Certificates of Participation at the end of the training.

4. The program content shown here is for guidance purposes only. Our continuous course improvement process may lead to changes in topics and course structure.

5. Approval of Course: Our Programs are NITA Approved. Participating organizations can therefore claim reimbursement on fees paid in accordance with NITA Rules.

Booking for Training

Simply send an email to the Training Officer on training@armstrongglobalinstitute.com and we will send you a registration form. We advise you to book early to avoid missing a seat to this training.

Or call us on +254720272325 / +254725012095 / +254724452588

Payment Options

We provide 3 payment options, choose one for your convenience, and kindly make payments at least 5 days before the Training start date to reserve your seat:

1. Groups of 5 People and Above – Cheque Payments to: Armstrong Global Training & Development Center Limited should be paid in advance, 5 days to the training.

2. Invoice: We can send a bill directly to you or your company.

3. Deposit directly into Bank Account (Account details provided upon request)

Cancellation Policy

1. Payment for all courses includes a registration fee, which is non-refundable, and equals 15% of the total sum of the course fee.

2. Participants may cancel attendance 14 days or more prior to the training commencement date.

3. No refunds will be made 14 days or less before the training commencement date. However, participants who are unable to attend may opt to attend a similar training course at a later date or send a substitute participant provided the participation criteria have been met.

Tailor Made Courses

This training course can also be customized for your institution upon request for a minimum of 5 participants. You can have it conducted at our Training Centre or at a convenient location. For further inquiries, please contact us on Tel: +254720272325 / +254725012095 / +254724452588 or Email training@armstrongglobalinstitute.com

Accommodation and Airport Transfer

Accommodation and Airport Transfer is arranged upon request and at extra cost. For reservations contact the Training Officer on Email: training@armstrongglobalinstitute.com or on Tel: +254720272325 / +254725012095 / +254724452588