Introduction
This training course aims to provide the knowledge and skills to analyze and evaluate investment decisions— to distinguish value-creating from value-destroying ventures. Finding energy resources is an uncertain business. Historically, many ventures failed, yet some successful projects also led to business success and significant value creation. Then, what is a good project opportunity?
The answer is likely multi-dimensional; it is about understanding disciplines from subsurface to economic, comprehensive coverage that eventually reflects our understanding of the value potentials of energy projects
Course Objectives:
By the end of this Energy Value Creation training course, the participants will be able to:
- Understand the principles of finance and economic decision analysis in the energy business
- Gain skills in effective formulation of investment decisions
- Understand the challenges of investment under uncertainty
- Gain skills in using analytical tools, including probabilities and decision trees
- Apply the knowledge and skills to the analysis of value-creating decisions
Target Audience:
- Analysts working on feasibility analysis of energy projects
- Engineers involved in the investment decision process
- Managers with responsibility or interest in the investment decision process
- Decision-makers within corporations or government bodies
- Individuals interested in expanding their skills and knowledge in the field of energy value creation
Course Outline:
Day 1
PRINCIPLES OF CORPORATE FINANCE AND VALUE CREATION
- Introduction to Energy Value Chain
- Analysis of decision making and corporate objectives
- Understanding uncertainty in Energy Projects
- Modelling Uncertainty
- Using probability to encode uncertainty
- Economic Consideration: Informed Analysis for value-creating decisions
Day 2
FROM UNCERTAINTY TO VALUE
- Comparative Analysis of Value
- Comparisons of Value Across Time
- Comparison of value across various levels of uncertainty
- Risk vs Uncertainty: Theory and Practice
- Principles of Discounted Cash Flow
Day 3
PROJECT CASH FLOWS, UNCERTAINTY, AND RISK
- Technical and Market Risks
- The Effect of Diversification
- Risk-Return Tradeoffs
- The Capital Asset Pricing Model (CAPM)
- Discounting Risk Premiums
Day 4
PROJECT APPRAISALS
- Uncertainty, risk, and financial return at Project and Portfolio Level
- Financing Leverage and its Effect
- General Investment Analysis, Energy Markets, and Prices
- Estimation of the Discount Rate
- Introduction to certainty-equivalent approach to investment analysis
Day 5
CHALLENGES IN THE ENERGY LANDSCAPE
- Managerial flexibilities and uncertainty
- Energy commodities and exchanges, market instruments to hedge risk
- Decision trees as a modeling and communications tool
- An integrated approach to valuation and analysis of value creation
- Future Challenges: environmental issues, emission taxes, and emission markets
About Rome
As cosmopolitan and diverse as it is rooted in its own history, Rome is one of the premier tourist destinations in the world. Featuring some of the best restaurants on the continent, some of the most iconic historic sites in Europe, the city is widely regarded as one of the most exciting and dynamic places to visit anywhere. The center of the Renaissance, the city houses some of the most famous works of art in the world and remains an important cultural hub to this day. Famous for art, fashion, it's delicious local cuisine, and superbly preserved monuments, Rome truly offers something for everyone.
Things to do and places to visit in Rome
When disembarking, the first thing that can prove pleasantly challenging is deciding on what to do first! An exceptional array of hotels and inns are available to any weary traveler, as are a superb range of restaurants for those wanting to relax surrounded by the hustle and bustle of Rome in the evening. You can spend the day walking streets steeped in history, visiting galleries that contain works by Caravaggio and Michelangelo or exploring the awe-inspiring Colosseum. The city contains many beautifully maintained parks and gardens, as well as a vast collection of beautiful churches and cathedrals, ensuring that a trip to Rome will be a memorable experience for anyone.
Things to do when taking flights to Rome include:
- Standing inside the magnificent Colosseum.
- Gazing in awe at the stunning Castel Sant'Angelo.
- Visiting the incredible Pantheon, one of the best-maintained buildings from the Roman era.
- Stopping at the center of the Piazza del Popolo, one of the most beautiful squares in Europe.
- Walking the beautiful gardens of Villa Borghese.
- Admiring the vast, intricately carved Column of Marcus Aurelius.
- Wandering the Forum Romanum, ruins from the Ancient Roman period.
- Exploring some of the greatest art collections in Europe.
- Crossing the river on the remarkably-constructed Bridge of Angels.
- Sampling the world famous local cuisine.