Details
Understanding finance and accounting is often the key to managerial progression, but the special problems in financial reporting and accounting for the Oil and Gas industry can make the whole topic seem daunting. The industry typically requires extremely
high levels of speculative investment with absolutely no guarantee of a successful return. It is characterized by lengthy time periods between the initial investment and any returns and it attracts many regulatory accounting rules and standards.
This five days training discusses the ways that the finance function deals with these special requirements. The program will have a practical approach and aims to enable each participant to fully appreciate the role of financial and accounting
information in decision-making and also the impact of their personal activities on their organization’s financial viability.
Outline
Day 1 Part 1 – Advanced Oil and Gas Accounting
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A profile of Oil and Gas operations and accounting
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Non-drilling Exploration Cost Under SE
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Financial reporting standards and generally accepted accounting principles
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Accounting concepts
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Governance, transparency and disclosure
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Reserve recognition accounting
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FC and SE accounting
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Ceiling test limitation
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Book value, SEC value, and FMV of reserves
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Depreciation, depletion, and amortization
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Cost depletion and percentage depletion
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International Accounting Standards for Oil and Gas
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Summary and key concepts
Day 1 – Part 2 - Cost Accounting for Oil and Gas Industries: A Systematic Review
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Acquisition Costs of Unproved Property Under SE
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Drilling and Development Costs Under SE
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Proved property cost disposition
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Pre-development costs Development costs
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International Accounting Standards for Oil and Gas
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Summary and key concepts
Day 2 – Part 1 - Accounting for Production Activities and Revenues
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Proved Property Costs Under SE
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Full Cost Accounting (FC)
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Accounting for production activities
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Accounting for revenue from Oil and Gas Sales
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International Accounting Standards for Oil and Gas
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Oil and Gas tax accounting
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Summary and key concepts
Day 2- Part 2 - Analysis of Oil and Gas Companies’ Financial Statements
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Comparing financial statements
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Reserve ratios
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Reserve replacement ratio, life ratio, net wells to gross well ratio
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Reserve cost ratios
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Lifting cost ratios DD&A analysis
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Reserve value ratios
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Value added ratio
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Ratio Roulette
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Financial ratios
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Summary and key concepts
Day 3 – Competitive Analysis and Comparisons
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A profile of Oil and Gas Operations and Accounting Procedure
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Non-drilling Exploration Cost Under SE
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Accounting For Production Activities
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Individual investment
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Institutional investment
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Employment
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Benchmarking
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Merger and Acquisition potential
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Identification of peer group
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Identification of comparison criteria
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Summary and key concepts
Day 4 - Advanced Issues in Oil and Gas Accounting
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Salient issues of regulation, negotiation and culture as they affect oil and gas company operations when they are entering new markets, with specific relation to international co-operations and acquisitions;
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Using Advanced Financial Measurement Techniques such as full cost, successful efforts and reserve recognition are used to evaluate oil and gas producing operations;
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Anticipating, formulating and implementing new strategies in the oil and gas industry, that will enhance their effectiveness within a dynamic global environment;
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Guiding oil and gas accounting strategists and management accountants in support of their strategic objectives and decision-making in conjunction with diversification and acquisition;
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Using the results of financial prospects in a oil and gas company are measured and reported through the analysis of financial statements and different accounting methods
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Using analytical skills and techniques in oil and gas capital budgeting and project evaluation including risk analysis for better decision-making and strategic planning
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Issues relevant to capital acquisition and management in order to generate more capital and greater return on investment;
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Implementing strategic risk management: Towards the enhancement of corporate goals in the oil and gas industrial sector.
Day 5 – Oil and Gas Contract
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Fundamentals basics of contract law in plain English and learning simple contract language risk mitigation techniques.
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Quickly identify dangerous words/phrases in the contracts of others that could cost your company millions.
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Effectively manage risk on your project with your company’s contract by learning the purpose and pitfalls of key contract clauses.
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Learn the contract secrets of owners and the claim techniques of contractors from a practitioner who in his career worked in-house for a major E&P company and represented contractor clients.
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using the issue-spotting checklists and tools provided to each participant.
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Commercial issues – relationship of market load to reservoir characteristics, project feasibility analysis, selection of the most appropriate contract
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Contract formulation – take-or-pay thresholds, accounting, transportation agreements, tariffs, reserving pipeline capacity
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Contract administration – force majeure impacts on take-or-pay, measuring gas quality, gas delivery procedures for multiple pipeline users, preparing invoices.
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Appraise and discuss the structure of the oil and gas industry contractual matrix
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Recognise, discuss and justify some of the main contractual clauses in the main contracts in the oil and gas industry
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Evaluate the effect of these clauses on the contractual parties
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