Oil and gas fields acquisition risks analysis (Buy-side M&A)

Competence area: Strategy, Investment

Industry/sector: oil and gas / exploration and production

Year of completion: 2020

Client: private investors, Russia

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Project background:

The client, a private investor with a highly diversified portfolio of investments in various branches of the real sector, contracted Investorium to determine the feasibility of investment in the developing of a group of oil and gas fields in the Northern part of Russia, thus considering the entire complex of geological, geo-environmental, technical, financial and economic aspects and risks, and assessing investment costs with regard to exploration, drilling and further development of the fields, including the creation of needed power-supplying and engineering infrastructure.

Scope of work:

In order to handle the extensive scope of the work, Investorium formed a project team and involved external industry experts with relevant technical expertise. The joint project team analyzed the data from the historical (primary) field exploration (seismic and well drilling data). Based on the analysis, the team estimated the hydrocarbons reserves, determined production profiles, and calculated the investment needed to perform additional geological exploration works and the costs involved in drilling a required number of wells of required types and profiles in required locations.

A distinctive feature of this project was the fact that the said oil and gas fields are located in a zone of federal nature reserves, which, both by definition and under the legislation, implies extra requirements for project approvals, exploration and survey works, drilling and production operations, and otherwise involves additional capital costs in order to satisfy the increased requirements of the environmental legislation. Another focal point of the project was the prospective analysis of the competitive situation and potential of the natural gas processing products market (methanol in particular), including the prospects of exports.

Deliverables:

As a result, the Client received a comprehensive investment opinion containing a complete analysis and assessment of project risks in all the focus areas (geology, geo-ecology, competitive environment, project economics) required for making a weighted investment decision. Additionally, the Client was provided with all necessary inputs for a detailed economic feasibility study of the project-specific technical solutions, including the calculation of the capital costs budget.

See selected project cases for reference

2014 - 2015 An assessment of a production assets pool development (Feasibility studies) GazpromTeploenergo, Russia See more 2014 Analysis of risks involved in an acquiring оf a CRE asset (Buy-side M&A) a subsidiary of Gazprom, Russia See more 2010 - 2014 Investor relations management for a CRE developer (Interim) Okhta Group, Russia See more 2010 - 2011 The sale of an industrial production business to a strategic investor (Sell-side M&A) private investor, Russia See more 2008 - 2009 Managing a mix-use CRE development project (Interim) SRV Group, Finland See more 2006 - 2008 Assessing feasibility of investment in power generation and exports State-owned energy monopoly, Baltic States See more 2006 - 2008 Designing a strategic partnership and doing DD of multiple acquisition targets (Buy-side M&A) Paroc Group, Finland See more 2006 - 2007 Forming a strategic vision: the future of the United Energy System of Russia RAO UES (United Energy System) of Russia See more 2006 - 2007 Search and analysis of acquisition targets in Russia (Buy-side M&A) AF-Enprima, Sweden See more 2005 Acquisition of an engineering business in the EC (Buy-side M&A) private investors, Russia See more 2004 - 2005 Reorganizing a group of design engineering companies (Interim management) North-West Engineering Centre of RAO UES of Russia See more 2004 A feasibility study of a major infrastructure project (a heating main) StroyTransGaz, Russia See more 2003 - 2004 A mid-term strategy development for a power generation company Kirishi CHPP, Russia See more