Oil & Gas Nyc.pdf

Oil & Gas Project Finance 01-03 May 2019, New York, USA $4495

Overview

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You will learn about: Accessing project funding in today's challenging markets Structuring large oil and gas eld development projects Financing pipelines, oil rigs, platforms, and other infrastructure LNG and fertilizer plants Power projects including 'green' energy deals Carbon credits Developing pro forma estimates and cash ow models Working with banks and understanding key legal risks in projects Of cial providers of funds and credit support (export credit agencies, development banks and others) Managing commodity price volatility in energy deals

Who Should Attend The course will be of value to professionals in the following areas: Project Finance Managers Credit Managers Securities Managers Corporate Banking Of cers Financial Analysts Strategic Planners Senior Executives Legal Advisors Business Analysts Consultants

Course Level In today's volatile energy environment nancing projects is uniquely challenging. It is ever more important to understand how suitable nancial structures for oil, gas and electricity projects are created as even the most carefully structured deals can face dif culties in attracting suf cient debt, equity or other funding from international or local investors.

Participants in this program will learn to structure projects in creative ways to

attract funding from banks, the bond market, equipment providers and public and private equity. They will look at approaches to facility upgrades and green eld projects in the oil gas and electricity sectors. They will analyse deals to develop robust security packages, as well as learning to apply many tools and techniques of quantitative nancial analysis. In hands on sessions employing excel models they will assess project debt capacity, return on investment, and other metrics common to attractive deals. Besides direct funding, in many transactions, credit enhancement techniques can also be very important. Thus traditional Export Credit Agency, Multi- and Bilateral Agency support, as well as tailored private sector political and commercial shifting mechanisms and programs are explained in detail. Cases and examples of projects from Africa, the Middle East, and elsewhere around the world are used throughout this program to ensure understanding and application of concepts. Active course participation is encouraged to ensure understanding and reinforce concepts. Cases require evening reading. Participants will be provided with complete lecture notes, cases, and selected readings to serve as a reference after the sessions are completed.

Agenda DAY 1 Themes: Energy Markets; Varying Approaches to Financing Different Types of Projects; Qualitative and Quantitative Analysis; Cash Flow Modeling Oil, Gas and Energy Project Finance Today’s market and energy transactions Structuring and sources of nance Limited recourse vs. balance sheet deals Types of projects and their comparative complexity Identifying and allocating risks - Pipelines - Field development and platforms - Production facilities - Re neries and petrochemical plants - LNG Facilities - Power Plants Key players and their roles Steps/timeline in a project nancing

Case Example: Pipeline Project Finance

Sources of Finance: Financing Checklist Domestic Borrowing Loans from International Banks International Capital Markets: Eurobonds, Private Placements Export Credit Support for Loans and Bonds Specialized Agencies: IFC and others Leasing Equity from Project Sponsors and Others Derivatives Usage

Risk Identi cation and Allocation Building a Risk Matrix Risk allocation between sponsors, creditors and others Technology and construction/completion Reservoir/reserves risks Feedstock risk Sales and off-take, operation and maintenance Abandonment/decommissioning Environmental considerations Political risk and regulatory issues

Quantitative Analysis: Using Proforma Cash ow Models Approaches to modeling for oil and gas transactions Developing an appropriate base case / running sensitivities and scenarios Focus of the debt providers: DSCR, loan life, and other key ratios Sizing debt in different types of projects Debt to equity balances Sponsor and key stakeholder perspectives Measures of investor return

Case Study : Financing an Ammonia Plant

Participants break into small groups to evaluate this security package this gas

processing plant. A computer simulation quanti es risk assessments.

DAY 2 Themes: Legal issues to Consider in Accessing Finance; Bank Markets; Credit Enhancement; Upstream Oil and Gas Field Development; Reserve-based Facilities;

Re neries, Transportation, Shipping; Power Project Financing Sources of Finance Club loans and bank syndicates Pricing, exibility, timing in the sector and today What security do banks want? Offshore accounts and trustees Mortgages on xed assets /contract assignments Capital markets and examples of projects Private placements, rule 144A and eurobond nancing Swap requirements and other derivatives usage: Commodity, interest rate and currency hedging Recent structures and examples

Credit Enhancement: Export Credit Agencies (ECAs) Of cial guarantees, insurance and funding programs for energy transactions Incentives in ECA programs: which are most popular today? Costs and availability

Islamic Financing Alternatives for Energy Projects Structures: Istisna, Ijara, Sukuk Examples: Petro-Rabigh Saudi Arabia, other

Upstream Oil and Gas: Oil and Gas Exploration, Development and Production Oil production: process depletion and enhanced recovery

Major systems and types of drilling equipment Offshore oil platforms in shallow and deep water

Reserve-Based Finance Development nance vs. reserve-based lending and borrowing bases Mezzanine funding Emergence of “North Sea” structures and reserve categories (P1, P2, P3) Common measures: (Loan Life Cover Ratio (LLCR), Project Life Cover Ratio (PLCR), Reserve Tail

Case Study: Financing a Condensate Field Development

Participants break into small groups to evaluate the security package and forecast cash ows for an upstream condensate eld development project.

“Midstream” and Re neries Understanding the process: from topping re neries to complex crackers Financing: green eld vs. expansion Re nery market analysis:

- Cash

ow volatility and operational risk mitigation

- Tolling structures Distribution controls and Information/other covenants Examples: Colombia, Vietnam

Biofuels Comparative costs and “grid parity” Government support schemes Biodiesel and ethanol

Oil and Gas Transportation, Shipping and Storage Logistics: pipelines, shipping, storage Crude gathering and transmission Re ned products transmission lines Tanks, oating storage and caverns Types of tankers

- AFRA classes (average freight weight assessment) ULCC to tanker lightering

Case Study:Rig Finance In small groups participants will assess a proposed bond issuance to re nance a semi-submersible rig conversion. Evaluating operating cash ows.

Power Project Financing Fragmentation of electricity sector into Gencos, Transcos and Discos Contracted sales and PPAs, merchant plants and tolling arrangements Gas and other fuel sources for thermal power plants Peakers vs. base-load facilities and power dispatch curves Rating agencies' analytical model

Case Study: Financing a Gas-Fired Power Plant

Participants will break into small groups to evaluate the security package for this cogeneration plant. A computer simulation is used.

DAY 3 Themes: Cash ow Modeling Workshop The program’s

nal day integrates discussion of the oil and gas sector with cash

ow modeling in workshop fashion. Using excel software, participants create a model for an LNG Plant suitable for examining project debt capacity as well as return on investment.

Overview: Oil, Gas and LNG Market Today Market Trends and Projects Case Example: Ras Laffan LNG LNG Sales Agreement Gas Payments and Royalties Construction Undertakings Financing Choices – Banks, ECAs and the Bond Market Equity Participation

Structuring a Cash ow Model and Organizing the Data Developing the Assumptions Page Construction Costs and Timing Operating Cost, Plant Capacity Usage, Fixed and Variable Costs Reinvestment, Plant Expansion, Productivity Shifts

Developing the Pro t and Loss and Balance Sheet Factoring in Reserves Considering Currencies Tax Calculations

Financing Section Equity First or Pro Rata Manually Designed Equity Subscription Draw-down of Debt Linked to Speci c Contracts or Expenditures or in a Hierarchy

Ratios and Sensitivity Analysis: Objectives and Limitations Measuring Debt Capacity and Investor Return Using Modeling Output for Initial Project Vetting Supporting on-going Negotiations

Summary and Wrap-up of Oil and Gas Project Structuring and Modeling

Instructor Meg Osius Ms. Osius designs and delivers executive level training sessions as well as providing consulting services to a wide variety of organizations worldwide. Specializing in international project nance, capital markets, and risk management, she works with corporate investors, private and development banks, equipment suppliers, law rms etc., to structure viable nancing packages for green- eld projects and facility upgrades in the power, oil and gas, transport, social services and telecom sectors. Prior to establishing her own rm Ms. Osius was a banker at JP Morgan Chase Bank where she structured international project transactions and advised clients on risk management. Ms. Osius has published articles in the business press and co-authored several self-study guides covering international project nance, trade and export nance, foreign exchange, and nancial futures, as well as nancial analysis in frontier markets. She is a primary speaker in a series of video sessions on Sound Banking Principles. Ms. Osius is a Director of British Caribbean Bank and Waterloo Holdings. Previously she was Chair of the Technical Advisory Panel of the Public Private Infrastructure Advancement Fund (PPIAF). The fund supports technical assistance in emerging markets to encourage private involvement in infrastructure development. She received an M.B.A. from INSEAD, the European Institute of Business Administration, in Fontainebleau, France. Her B.A. degree is from Princeton University.

Venue New York This programme will take place on a Non-residential basis at a Central New York Hotel or training venue. Non-residential course fees include training facilities, documentation, lunches and refreshments for the duration of the programme. Delegates are responsible for arranging their own accommodation, however, a list of convenient hotels (many at specially negotiated rates) is available upon registration.

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