| Valuing Oil and Gas Interests—Identifying and Measuring Risk
Program Type: Recorded Webinar (Audio, PPT Presentation)
Program Level: Intermediate
Prerequisites: Previous training or research on subject matter being taught.
Advanced Preparation: None
Delivery Method: Group Internet-Based
CPE Credits: Two (1) Hours
Fields of Study: Specialized Knowledge & Applications
Shipping Weight: 0lbs. 0oz.
The fair market value of oil and gas (O&G) investments are determined solely by the economic feasibility of the sub-surface hydrocarbon reserves. Investors perceive the investment in an individual O&G prospect as riskier than investing in an exploration and production (E&P) company’s traded stock or debt. The valuation of interests in O&G reserves requires unique education, training, and experience due to the unusual characteristics of the E&P industries; a) unique terms and definitions; b) specialized accounting practices and procedures;, c) lack of diversification;, d) the nature and character of unsystematic risk; and e) the depleting nature of reserves and the absence of a salvage value. Reserve valuation procedures merge elements of both real estate appraisal standards and business valuation standards, presenting challenges to the analyst.
After completing this webinar, attendees will be able to:
- Identify the unique terms and definitions associated with exploration and production
- Recognize the phases of developing an O&G reserve
- Identify the unique accounting principles and practices
- Detect the systematic and non-systematic risk of exploration and production
- Calculate volume, price, and expense forecasts
- Formulate discount rates for Discounted Cash Flow Models of E&P
- Apply traditional valuation approaches and methods
Who Should Attend
Valuation practitioners specialized in business valuation
Mark W. Shirley, CPA, ABV, CFF, CVA, MAFF, CFE