Understanding Financing, Risk and Decision-Making for Energy Industry Professionals

This is the training course that energy industry professionals must attend to acquire the financial know-how and techniques essential in support of successful business management.

The financing of new investment in all industries usually requires major funding and is generally risky. The financing of investment in the acquisition, exploration, and development, and subsequent operation and maintenance of new assets in the energy industry faces additional risk. 

The decisions as to whether to invest in new capital projects require critical business decision-making during the investigation and feasibility assessment phases but also appraisal of returns on capital employed and other financial implications, and the analysis of risk.

The financial evaluation of potential investments requires the preparation of detailed cash flow projections to determine, as accurately as possible, the expected returns to an organisation under varying conditions of uncertainty. Realistic cash flow projections will reflect the initial capital expenditure required for the acquisition of assets, working capital requirements, and expected revenues and operational costs that include, for example, maintenance of assets over their expected economic lives. 

On a global scale many capital projects fail to meet targeted milestones, and strategic and financial objectives. This is usually because of failing to plan properly and apply appropriate techniques of investment evaluation. The financing decision-making, planning, and risk analysis tools and techniques used to evaluate potential investments and determine the likelihood of success are all included in this training course.

This Energy Training Centre course will highlight how to:

• Identify how financial decision-making regarding investment and financing both impact on value creation
• Use financial planning models as the basis for determining cash flows for investment appraisal
• Apply the wide range of methods of investment appraisal
• Use the tools and techniques of risk analysis, for example sensitivity analysis, simulation modelling and scenario analysis to evaluate investments
• Evaluate the financial strategies used to manage and mitigate financial risk
• Use the techniques of problem-solving and root cause analysis to develop continuous improvement initiatives for enhanced business performance

Objectives

By the end of this training course participants will have learned about:

• Fundamentals of decision analysis
• The business decision-making process
• Measuring profitability
• Strategy formulation and direction
• Financial planning and modelling
• Decision analysis and appraisal of domestic and international investment
• Sources of financing and the cost of capital
• Risk identification, analysis and management using appropriate responses
• Risk analysis, expected values, simulation and scenario analysis
• Problem-solving techniques, decision support and performance improvement techniques

Training Methodology

This Energy Training Centre course does not assume prior knowledge of the topics covered and is presented in a very hands-on way to suit individuals with varying levels of financial knowledge and experience.  Delegates will acquire the financial know-how and techniques and essential skills, with the benefits from the Instructor’s own commercial career experiences and through presentations and interactive learning methods.

This training course includes numerous illustrative examples, real-world experiences and many real-world business scenarios. New ideas, tools and techniques are introduced incrementally to enable participants to progress from the fundamental to the more complex topics.

 Participants will develop their learning through group discussions, and team-based exercises and case studies that reinforce the application of each of the learning points. Difficult mathematical concepts are minimised wherever possible and handled in a visual way that is easy to understand – our aim is for this to be an enjoyable learning experience. The material has been designed as a reference point to which participants may refer regarding application of the various tools and techniques back in the workplace.