Reserve Based Lending

Learn how project finance techniques have been specifically developed for financing upstream oil & gas development & production. The focus is on risk analysis and debt sizing for both single asset and borrowing base facilities.

This course is designed to provide participants with an introduction to the upstream oil & gas industry and an understanding of the techniques employed for financing the development and production of oil & gas.

Participants will learn how oil & gas reserves are estimated and classified, as well as the financing structures which have been developed for lending against anticipated reserves.

Starting with an introduction to the history and structure of the oil & gas industry, participants are guided through the process of analysing risks specific to upstream financing, with particular attention being given to the estimation and classification of oil & gas reserves.

Structures which have been developed for financing single assets are explained, before participants are introduced to the mechanics of borrowing base facilities which are used for financing multiple field assets.  A live cashflow model is used to illustrate how debt facilities are sized and how the borrowing base is regularly redetermined.  The course concludes with an introduction to the key commercial contracts which underpin upstream oil & gas developments and the finance documentation which is required.

Participants’ knowledge is consolidated through example case studies and interactive practical exercises, which include a debt-sizing financial model and example financing term sheet.

On completion of the course, participants will be equipped with a clear understanding of:

  • The history & structure of the upstream oil & gas industry;
  • The estimation and classification of oil & gas reserves;
  • The fundamental aspects of reserve based lending;
  • Qualitative & quantitative risk analysis;
  • Debt sizing;
  • Single asset financing;
  • Borrowing base financing;
  • Borrowing base redetermination;
  • Key commercial and finance agreements.

The course is led by Ian Cogswell, who shares the knowledge he has gained from over 20 years’ practical experience of oil & gas project financing.