Programme contents include
Organisational Tasks, Division of
Work/Labour, Delegation of Role, Task,
Power, Authority in a Project Management and
General Organisational Setting,
Responsibility for Task Performance in an
Organisation-Wide Setting, Stratigraphic
Test Well or
Exploratory well, Service well, Dry hole,
Dual completion, Dry natural gas
natural and artificial lifts,
Oil
and Gas production and Sales, Some State and
US Federal Oil and Gas Drilling Regulation,
Maximum Efficiency Drilling Rate (MER), The
Concept of Peak Oil, Historical cost
accounting methods, Historical Development
of accounting methods and current status,
Introduction to successful efforts
accounting, Chart accounts for successful
efforts company, Oil and Gas subsectors –
Upstream, Mid-Stream and Downstream,
Horizontal, Vertical and Full Integration
within the Oil and Gas Industry, Addressing
Problems associated with Oil and Gas
Accounting, Nondrilling Exploration Costs,
Successful Efforts,
Introduction to Full Cost (FC) Accounting, Distinguishing between
Non-drilling and Drilling Costs, Cost of
Identifying areas that might warrant
exploration, Cost of topographical,
geological and geophysical studies, Cost of
carrying and retaining undeveloped
properties, Dry hole contribution, Cost of
drilling and equipping exploratory well,
Cost of drilling exploratory type
Stratigraphic test well, Successful Efforts–
Exploration Cost, Accounts for a full cost
company, G&G costs, Reconnaissance survey,
Detailed Survey, Shooting Rights, Obtaining
G & G Permits, Exchanging C & G Studies for
Property Interest.
Programme Coordinator:
Prof. Dr. R. B. Crawford is the Director of
HRODC Postgraduate Training Institute, A
Postgraduate-Only Institution. He has the
following Qualifications and Affiliations:
Doctor of Philosophy {(PhD) {University College
London (UCL) - University of London)};
MEd Management (University of Bath);
Postgraduate (Advanced) Diploma Science Teacher
Ed. (University of Bristol);
Postgraduate Certificate in Information Systems
(University of West London, formerly Thames
Valley University);
Diploma in Doctoral Research Supervision,
(University of Wolverhampton);
Teaching Certificate;
Fellow of the Institute of Management
Specialists;
Human Resources Specialist, of the Institute of
Management Specialists;
Member of the Asian Academy of Management
(MAAM);
Member of the International Society of Gesture
Studies (MISGS);
Member of the Standing Council for
Organisational Symbolism (MSCOS);
Member of ResearchGate;
Executive Member of Academy of Management (AOM).
There, his contribution incorporates the judging
of competitions, review of journal articles, and
guiding the development of conference papers. He
also contributes to the Disciplines of:
Human Resources;
Organization and Management Theory;
Organization Development and Change;
Research Methods;
Conflict Management;
Organizational Behavior;
Management Consulting;
Gender & Diversity in Organizations; and
Critical Management Studies.
Professor Dr.
Crawford has been an Academic in the following
UK Universities:
University of London
(Royal Holloway), as Research Tutor;
University of Greenwich (Business School), as
Senior Lecturer (Associate Professor), in
Organisational Behaviour and Human Resource
Management;
University of
Wolverhampton, (Wolverhampton Business School),
as Senior Lecturer (Associate Professor), in
Organisational Behaviour and Human Resource
Management;
London Southbank University (Business School),
as Lecturer and Unit Leader.
His responsibilities
in these roles included:
Doctoral Research
Supervisor;
Admissions Tutor;
Postgraduate and
Undergraduate Dissertation Supervisor;
Programme Leader;
Personal Tutor
For Whom
This Course is Designed
While Petroleum – Oil and Gas – Exploration,
Development and Production appear to be at their
peak in a number of countries, there are others
where they are at the growth stage, some such as
Uganda, are still at the exploration stage, with
development, and subsequent production, expected
to commence within the next few months. Shale
Gas Exploration is in its advanced stage in the
UK, with its Development and Production having
achieved economic prominence in countries such
as Algeria, Argentina, Australia, Brazil, Canada
(which has also been expanding its Oil Sands
Production), China, Indonesia, Mexico, Russia,
South Africa, and United States.
This Programme seeks to equip students with a
Postgraduate Diploma, which will greatly enhance
their employability and career advancement
within the International Petroleum – Oil and Gas
– Industry. The 3 Months Intensive Full-Time, or
20 Weeks Video-Enhanced Online, Programme leads
to a Postgraduate Diploma in Advanced Oil and
Gas Accounting: International Petroleum
Accounting..
and Successful Efforts Accounting Methods;
Aspirants to employment within the International
Petroleum – Oil and Gas – Industry;
Asset Accountants;
Board
Members;
Chief Accountants;
Chief
Executive Officers (CEOs);
Chief Executives;
Chief
Financial Officers (CFOs);
Chief
Operations Officers (COOs);
Cost Accountants;
Drilling & Refinery Managers;
Energy Ministry Personnel;
Engineers;
Entrepreneurs;
exploration, production, and accounting systems.
Finance Directors;
Finance Managers;
Financial Accountants;
Financial Analysts;
Financial Controllers;
General
Managers;
Geologist;
Government Ministers;
Government Regulators;
Internal and External Auditors;
International Petroleum – Oil and Gas – Workers
seeking to enhance their career prospects within
the industry;
Joint
Operation Facilitators;
Joint Venture Accountants;
Joint
Venture Accountants;
Junior
Managers;
Legal Personnel interested in developing
expertise in Mineral Rights, Lease, Contracts
and related aspects of International Petroleum –
Oil and Gas – Operation
Management Accountants;
Management Accountants;
Managing Directors;
Managing
Directors;
Marketing & Sales Directors & Managers;
Middle
Managers;
New Graduates seeking a Career Focus;
Oil and Gas Accountants desirous of acquiring
expertise in Full Cost Accounting
Others interested in the operation of the Oil
and Gas Industry, its regulation;
Petroleum Department Personnel;
Project Managers;
Public Accountants;
Revenue and Custom Representatives;
Senior
Executives;
Senior
Financial Accountants;
Senior
Management Accountants;
Senior
Managers;
Senior
Petroleum - Oil and Gas – Accountants;
Senior
Public Administrators;
Strategic
Business Unit (SBU) heads;
Strategic
Planners;
Supervisors;
Supervisory Board Members;
Team
Leaders;
Treasury Officers;
Venture Capitalists;
All others desirous of enhancing their expertise in the areas of
Petroleum – Oil and Gas Accounting:
International Petroleum Accounting, Strategic
Management, Project Management, Organisational
Analysis and Design.
Classroom-Based Duration and Cost:
Classroom-Based
Duration: 6 Weeks (5 Days per Week)
Classroom-Based
Cost: £30,000.00 Per Student
Online (Video-Enhanced) Duration and Cost
Online Duration:
10 Weeks – 3 Hours Per Day, 6 Days Per Week
Online Cost:
£20,100.00 Per Student
Classroom-Based Programme Cost includes:
Free Continuous snacks throughout the Event Days;
Free Hot Lunch on Event Days;
Free City Tour;
Free Stationery;
Free On-site Internet Access;
Postgraduate Diploma/ Diploma – Postgraduate –or
Certificate of Attendance and Participation – if unsuccessful on
resit.
Students and Delegates will be given a Selection of our Complimentary
Products, which include:
Our
Branded Leather Conference Folder;
Our Branded Leather Conference Ring Binder/
Writing Pad;
Our Branded Key Ring/ Chain;
Our Branded Leather Conference (Computer –
Phone) Bag – Black or Brown;
Our Branded 8-16 GB USB Flash Memory Drive, with
Course Material;
Our Branded Metal Pen;
Our Branded Polo Shirt.;
Our Branded Carrier Bag.
Daily Schedule:
9:30 to 4:30 pm.
Delivery Locations:
Central London, UK;
Dubai, UAE;
Kuala Lumpur,
Malaysia;
Amsterdam, The
Netherlands;
Brussels, Belgium;
Paris, France; and
Durban, South Africa;
Other International
Locations, on request.
Programme Objectives
By the conclusion of the specified learning and development
activities, delegates will be able to:
Module 1
Demonstrate an
understanding of the organisation, as an entity,
as opposed to other groups;
Demonstrate an
understanding of the different levels and types
of organisations and objectives;
Formulate project
objectives;
Demonstrate an
understanding of the meaning of collegiality
within a project management and general
organisational setting;
Demonstrate an
understanding of an organisation or its
subsystem’s need to meet the expectations of the
external environment;
Demonstrate an
awareness of the consequences of failure to meet
the organisations external accountability;
Demonstrate an
understanding of the importance of delegation;
Demonstrate the
competence in managing the delegation process
effectively;
View external
accountability as the expectations of the
organisation by different agencies;
Demonstrate their
understanding of the requirement of different
external agents;
Assess the
consequence to the organisation of its failure
to meet the requirements of particular agencies;
Determine the ways in
which an organisation might meet its varying
accountability requirements;
Assess the
organisation’s strengths and weaknesses;
Determine the
opportunities that are available to the
organisation and how it might best take
advantage of it;
Analyse the threats
that the organisation faces and how they might
be circumvented;
Conduct an effective
SWOT analysis, taking account of the political,
economic, social, and technological factors into
account;
Analyse their
organisation using PEST, PESTEL and LONGPEST
factors into account;
Develop an awareness
for their own strengths and weaknesses;
Develop a strategy
for maintaining their strengths while developing
their weak areas;
Determine factors
within their work environments that are
stressors;
Manage their workload
in such a way that they reduce the negative
effects of their associated stressor;
Manage their time
effectively, contributing to individual success
and organisational improvement;
Put forward their
points without generating negative reaction from
others;
Manage their
interaction with colleagues and managers, in
such a way that they get their desired results;
Define strategic management and explain its five special
elements;
Explain the core areas of strategic management and how they link
together;
Distinguish between process, content and context of a strategy;
Explain the nature and importance of green strategy;
Outline the extent to which strategic management differs in
public and non-profit organisations;
Explain the difference between national and international
strategic management;
Identify the causes
of an organisational failure;
Explain why it is important to study the environment of the
organisation;
Outline the main environmental influences on the organisation and
relate the degree of change to prescriptive and
emergent strategic approaches;
Identify the green strategy issues that must be tackled by the
organisation;
Undertake a PESTEL analysis of the general influences on the
organisation;
Understand the implications of market growth and market
cyclicality for strategic management;
Define strategy dynamics;
Identify the various approaches of strategy dynamics;
Outline the main considerations in the development of purpose
including green strategy;
Explore the organisation’s vision for the future and its
strategic implications;
Analyse the balance of power amongst stakeholders in the
organisation;
Develop a mission for the organisation;
Define the objectives of the organisation to be achieved by its
strategies;
Outline the chief areas of corporate governance that will
influence strategy and decision making at the
centre of the organisation;
Show how ethics and
corporate social responsibility shape the
purpose of the organisation;
Design a research
project, taking account of important issues;
Choose sources of
information appropriate for the type of research
being conducted;
Assess the value of
secondary sources of information as a prelude to
the conduct of primary research;
Choose the
methodology that best suits the type of
investigation being conducted & appropriate to
the research objectives;
Choose the most
appropriate data elicitation techniques, in
relation to the sampling frame, sampling unit,
sample size & time span, among other factors;
Advise others of the
situations in which participant observation,
conversation analysis, documentary analysis,
focus groups, interviews & questionnaires,
respectively, are appropriate;
Design interviews and
questionnaires that will elicit information
appropriate to the research objectives;
Design structured and
unstructured questions, determining the
conditions under which they should be used;
Design questionnaires
and interview schedules, with a mixture of
open-ended & closed-ended questions, avoiding
forced-choice in the latter;
Employ appropriate
data analysis techniques, based on the type &
volume of data available;
Use SPSS and, or,
Excel software packages in analysing data;
Identifying ‘trends’
& ‘patterns’ in information, in an effort to
arrive at conclusions;
Produce effective
reports, adhering to conventional styles,
presenting evidence from the data, & exploiting
visual representations;
Make research
proposals, taking pertinent factors into
account;
Manage research
projects, from inception to reporting;
Identify appropriate
roles in research project management & produce
realistic costing;
Design a research
project that incorporates a high ethical
standard;
Determine and develop
a project life cycle;
Determine the
activities and problems associated with each
stage of the project life cycle;
Be able to conduct an
effective cost benefit analysis;
Determine the cost
effectiveness of a project or a stage in its
life cycle;
Demonstrate an
understanding of the system’s approach to
project management;
View project
management in a holistic manner;
Be aware of the five
bases of coordination and determine which is
appropriate for a particular situation;
Determine the
factors, which contribute to workers’ resistance
to change;
Suggest the efforts,
which an organisation might employ to reduce
workers’ resistance to change;
Demonstrate their
awareness of change management and human
resource implications;
Distinguish between
change strategies and approaches to change;
Illustrate the
advantages and disadvantages of each strategy
Manage latent and manifest resistance to change;
Determine the
situations when a particular approach might be
appropriate;
Determine the most
effective ways of communicating change decisions
to workers;
Illustrate the
advantages and drawbacks of group involvement in
decisions related to change;
Design measures,
which will ensure change institutionalisation;
Demonstrate
leadership in the implementation of change,
whilst avoiding whilst avoiding Human and
Organisational Casualties;
Determine the value
of information in project methodology;
Demonstrate their
understanding of different project
methodologies, determining their benefits and
pitfalls for particular types projects;
Determine the most
appropriate methodology for individual
situations;
Demonstrate an understanding of the concept of
motives and their value in organisational and
subsystem effectiveness;
Distinguish between the different sets of
motivation theories, notably content, process
and reinforcement;
Demonstrate their ability to translate
motivation theory into practice;
Evaluate the appropriateness of the application
of particular theoretical aspects of motivation
to specific situations;
Demonstrate their ability to formulate a
comprehensive motivation strategy;
Critically appraise existing motivation strategy
within their organisations, identifying and
addressing gaps;
Formulate a workable motivation strategy;
Follows the common
trends in the popular motivation theories;
Demonstrate their
appreciation of the need for a variance in
intrinsic and extrinsic values if motivation;
Demonstrate how
popular motivation theories have contributed to
our understanding of worker behaviour;
Locate performance
related pay, productivity bonuses and other
remuneration inducement within existing
motivation theory;
Illustrate how the
contingency approach to motivation might be
applied to different situations;
Indicate the part
that training and development play in worker
motivation;
Manage the process of
motivation, taking account of socio cultural and
economic differences;
Manage the motivation
process, taking account of the differences in
preferences and expectation of workers;
Apply the ‘equity’
theory to work situation from a ‘differentiation
perspective’, rather than an ‘equality
perspective’;
Have an awareness of
the fundamental issues associated with
organisational design and their implications for
effective organisational functioning;
Demonstrate their
ability to design an appropriate organisational
structure that takes account of contingent
internal and external environmental factors; and
Demonstrate their
appreciation and understanding of how
organisations, and particularly managers, might
control, modify or re-engineer their work
environment through a study of
management/leadership styles, control systems,
organisational development and learning.
Module 2
Demonstrate an understanding of the oil and gas industrial and
the activities of each subsector;
Demonstrate an awareness of the salient issues associated with
the development of the United States oil and
gas industry, as a mark car to International oil
and gas exploration developments and its mining
operations;
Address the geological issues relating to the origin,
exploration and production of oil and gas;
Outline the methods of production, employed in the oil and gas
industry;
Describe the methods of exploration generally used within the
oil and gas industry;
Explain the contractual issues that are associated with oil, gas
and mineral lease;
Address problems and issues associated with upstream oil and gas
operation;
Outliner the role of finance and accounting in an Oil and Gas
Organisations;
Demonstrate an appreciation of financial reporting policies and
practices applicable in Oil and Gas Industry;
Distinguish between the different types of wells;
Distinguish between natural and artificial lifts, in oil and gas
production;
Demonstrate a working knowledge of Amortization, with particular
reference to the oil and gas industry.
Work through examples of Amortization of exploration and
development costs of proved developed reserves;
Accurately account for ‘Disposition’ of capitalized costs, in
reference to the impairment of unproved
properties.
Appropriately address Disposition of capitalized costs from the
surrender or abandonment of property;
Distinguish between 3D and 4D Seismic;
Explain, with examples, Overriding Royalty Interests (ORI);
Distinguish between Mineral Rights, Mineral Interests and Fee
Interests;
Discuss, with examples, the benefits and drawbacks of nonworking
interest;
Distinguish between Non-drilling and Drilling Costs;
Appropriately apportion costs to non-drilling and drilling
operations, respectively;
Explain the basic principles of Successful Efforts Accounting in
Oil and Gas;
Demonstrate mastery of the concepts and issues associated with
exploration and drilling operation; and
Explain, with minor omissions, the processes involved in oil and
gas acquisition, exploration and mining.
Module 3
Demonstrate a heightened understanding of the differing levels of
Financial Reporting Regulation and
Standardization, as they apply to Oil and Gas
Accounting;
Demonstrate a heightened understanding of salient accounting
concepts and governance
Demonstrate a heightened understanding of the differing levels of
regulation and standardization applied to Oil
and Gas accounting;
Deconstruct the role of finance and accounting in an Oil and Gas
Organisation;
Exhibit a heightened understanding of the requirements of
International Financial Reporting Standards;
Demonstrate a heightened ability to analyse their company’s
performance, as an oil and gas player or
regulator;
Demonstrate their
ability to determine the extent to which
financial measurement techniques such as full
cost, successful efforts and reserve recognition
can be used to evaluate oil and gas producing
operations;
Exhibit their ability
to utilise Advanced Financial Measurement
Techniques such as full cost, successful efforts
and reserve recognition are used to evaluate oil
and gas producing operations;
Exhibit their ability to manage risk effectively
in oil and gas project
contracts, averting pitfalls of key contractual
clauses;
Demonstrate the most appropriate contract formulation for
Take-or-pay thresholds, accounting,
transportation agreements, tariffs, reserving
pipeline capacity, respectively;
Determine the roles and interplay of the Governments of
territories containing hydrocarbon reserves,
National Oil Companies, International Oil
Companies, the Major Product Suppliers, the
Engineering & Contracting Companies and the
Service Companies,
Suggest the principal standard form contracts used in the
industry including the North Sea LOGIC/CRINE
standard form contracts and the Association of
Independent Petroleum Negotiators (AIPN)
standard form contracts;
Explain the international dispute resolution framework and
institutions in the context of expert decisions,
mediation arbitration and litigation.
Module 4
Determine to what entity is SFAS 143 applicable;
Identify the results of legally enforceable obligations;
Site examples of AROs where the company is normally legally
obligated;
Know what should be considered in identifying obligating events
that require recognition of an asset retirement
obligation;
Determine the effect of initial recognition of asset retirement
obligation liability;
Learn that ARO must be initially measured based on fair value in
compliance with SFAS No. 143;
Distinguish the traditional approach from Expected cash Flow
Approach;
Define a credit-adjusted risk-free rate;
Explain the concept of market risk premium;
Find out when companies should recognise the changes in the
liability for the retirement asset obligation
resulting from the passage of time or revision
to either the timing or the amount of the
original estimated future cash flows;
Discuss how the changes in the asset retirement obligation due to
the passage of time should be measured;
Learn how accretion expense is computed through the interest
method of allocation.
Know when loss or gain recognised upon settlement of ARO;
Determine how changes due to revised estimates of the amount or
timing of the original undiscounted cash flows
are recognised;
Know how frequently an ARO should be assessed to determine
whether a change in the estimate of the ARO is
necessary;
Determine the effects of the existence of a fund or provision of
assurance by a firm that it will be able to
satisfy its asset retirement obligations;
Explain conditional AROs;
Identify what must be disclosed by a company reporting a
liability for its asset retirement obligations;
Determine the applicability of SFAS No. 144;
Classify assets according to its group;
Define “impairment” in accordance with SFAS no. 144 definition;
Determine whether a long-lived asset to be held and used is
impaired and explain the three-step approach to
recognise and measure an impairment loss;
Cite circumstances that may trigger impairment testing;
Know when a company is requires to test long-lived asset for
recoverability;
Establish how impairment is measured;
Ascertain the accounting and reporting requirements related to
long-lived assets that are to be disposed of
either by sale, abandonment or exchange for
other productive assets;
Determine when long-lived assets to be sold are still classified
as “held for sale”;
Determine inclusions in the term” component of an entity” in
relation to disposal group;
Define the following concepts:
API gravity
BS & W
Btu
Casing head gas
Casing head gas.
City gate
Commingled gas.
Dissolved gas
Field facility
Gas balancing agreement
Gas settlement statement
Gauging
Heater-treater
LACT unit
Local distribution company (LDC)
Mcf
Natural gas
Non-associated gas
Tapping
Thief
Tank strapping
Separator
Explain the importance of the measuring process to the
accountants;
Identify the process in measuring crude oil;
Recognise the importance of run ticket calculation and describe
the process used to complete a run ticket
determine a net volume from a tank run;
Determine the changes in crude oil marketing and differentiate
the marketing adopted in the past with the
present;
Distinguish the process involved in natural gas measurement from
oil measurement;
Know the present method of selling natural gas as distinguish
from the method employed in the past;
View an example of division contract;
Determine the correct division of the revenue from sale of oil
and gas among owners of economic interest
according to the ownership interest shown on the
division order;
Be familiar with the process involved in unitization of
properties;
Determine who is responsible for paying the severance taxes, the
royalty owners and other owners of economic
interest;
Give the step-by-step process in recording oil revenue;
Cite the usual reason of producing companies for exchanging crude
oil;
Know the importance of converting gas measurements to MMBtu and
to Mcf for purposes of recording gas revenue;
Ascertain the appropriate thing to do to allow venting or flaring
of gas;
Determine the condition required to allow selling of unprocessed
natural gas;
Discuss the procedures involved in natural gas processing;
Know the importance of gas storage;
Find out the requirement of contracts with take-or-pay
provisions;
Know when revenue of crude oil and natural gas sales should be
recognised;
Know when, who and how payments to royalty owners and other
owners of economic interest are made;
Discuss about gas imbalances;
Differentiate produces gas imbalances from pipeline gas
imbalances;
Discern how oil and gas are allocated;
Determine what causes payment of minimum royalty;
Enumerate the different nondrilling costs;
Know the accounting treatment for acquisition costs;
Know the tax treatment of costs related to drilling operations;
Specify some typical lease and well equipment;
Categorise the revenue arising from the production and sale of
oil and gas products;
Identify the two important expenses connected with lifting and
treating the oil and gas and differentiate one
from the other;
Enumerate the situations under which losses from unproductive
property may be taken for tax purposes;
Discuss the concept of percentage depletion and give the
circumstances under which it is allowed;
Determine what areas of oil and gas are applicable to “property”;
Know what IDCs are recaptured as ordinary income;
Know how acquisition costs should be treated;
Know how revenue by a lessor as his share of production is
treated;
Cite the importance of joint operations in oil and gas
exploration and production;
Identify the different types of contracts that may be involved in
joint operations;
View a model form of operating agreement;
Define the following terms used in the contract that are
frequently subject to questions or
interpretation:
Affiliate
Agreement
Controllable Material
Equalized Freight
Excluded Amount
Field Office
First level Supervision
Joint Account
Joint Operations
Joint property
Laws
Material
Non-Operators
Offshore Facilities
Off-site
On-site
Operator
Parties
Participating Interest
Participating party
Personal expenses
Railway receiving point
Shore base facility
Supply store
Technical Services
Identify the inclusions in statement and billings to be provided
by the operator to all nonoperators;
Explain “cash calls” or advanced payment by the nonoperators;
Determine the period adjustments to billing or cash advance may
be made;
Determine the period when expenditure audits may be allowed;
Explain the provision on approvals of parties;
Explain the necessity of allocations in the course of joint
operations;
Discuss the following costs that are normally treated as direct
costs in various COPAS accounting procedures:
Rentals and royalties
Labour
Material
Transportation
Services
Equipment and facilities furnished by operator
Affiliates
Damages and losses to joint property
Legal Expense
Taxes and permits
Insurance
Communications
Ecological, Environmental, and Safety
Abandonment and reclamation
Other expenditure
Enumerate the three types of overhead (Indirect Cost);
Differentiate the two methods of computing overhead – Fixed rate
or percentages basis;
Differentiate construction overhead form catastrophe overhead;
Discuss the pricing of joint account material purchases, transfer
and dispositions.
Explain the different special pricing provisions;
Know the importance of maintaining a detailed record of
controllable materials and the conduct of regular
physical inventories;
Determine the situation when special inventory is required;
Identify the different direct charges for purposes of joint
interest accounting;
Explain how proportionate consolidation methods in joint ventures
are done, through:
Booking charges to the joint account: accumulation
of joint costs in operator’s regular account
Booking charges to the joint account: distribution
of joint costs as incurred;
Know what triggers the occurrence of nonconsent
operations; and
Determine how materials purchased are charged.
Modules 5
Determine the three (3) basic methods of conveying
mineral interest;
Distinguish between operating (working) interests
and nonoperating (nonworking) interests;
Differentiate basic working interest and joint
working interest;
Define Basic Royalty Interest (RI), Royalty Interest
(ORI), Production Payment Interest (PPI) and Net
Profits Interest;
Summarise the conveyance rules contained in SFAS No.
19;
Cite the requirements of SFAS No. 153 for “Exchanges
of Nonmonetary Assets”;
Identify the transactions considered as farm-out;
Define the terms farm-in and farm-out;
Discuss the concept of farms-in/farms-out with a
reversionary working interest;
Specify the accounting treatment for a free well
arrangement;
Determine under what situation sole risk arises;
Identify who is considered as a carried interest or
carried party in a sole risk;
Describe a situation considered as a joint venture
under paragraph 47e of SFAS No. 19;
State the effect of pooling and unitization;
Distinguish pooling from unitization;
Give the purpose of unitization;
Compute barrels for pay-out, proved reserves and
proved developed reserves;
Determine what are involved in the sale of oil and
gas property;
Summarise the accounting treatment of the sales of
oil and gas properties;
Discuss the accounting treatment of a sale of the
entire interest in an unproved property;
Specify the special accounting treatment given to
sales of partial interest in an unproved property;
Know when loss and gain are recognised in sales of
an entire interests in a proved property;
Give an example illustrating the accounting
procedure for proved property sales;
Indicate the accounting treatment for sales of
partial interest in proves property;
Know how loss or gain is determined when the entire
working interest in a proved property is sold and a
nonworking interest is retained;
Explain how production payment interest is created;
Discuss the accounting treatment for retained
production payment;
Know what the seller and buyer must do when the
retained production payment is reasonably assured;
Know how the conveyance is treated in case the
retained production payment is not reasonably
assured;
Cite the effect of curved-out production payment to
the working interest owner;
Specify the concept of carved-out production payment
payable in money;
Discuss the concept of carved-out production
payments payable in product or volumetric production
payment;
Compare the treatment of conveyances under
successful efforts and full cost accounting;
Identify the companies required to present
disclosures under SFAS No. 69 and discuss the
applicable rules in such disclosure;
Identify the test in determining whether an
enterprise is having significant oil and gas
producing activities for purposes of the application
of the disclosure requirement;
Enumerate the information required to be disclosed
by publicly traded companies in their annual
financial statements;
Distinguish between deterministic and probabilistic
reserve estimation methodology;
Identify the type of reserve that may be reported
under SFAS No. 69;
Define the term “reserve”;
Compare developed proved reserve and undeveloped
proved reserve;
Explain why SFAS required the use of year-end price
in estimating reserve;
State the purpose of reserve quantity disclosure;
Determine how and what are included in the
disclosure of capitalised cost relating to oil and
gas producing activities;
Cite the importance of disclosing information about
property acquisition, exploration and development
activities;
Give the relevance of the disclosure of the results
of operations for oil and gas producing activities;
Explain the concept of Standardised Measure of
Discounted Future Net Cash Flows Relating to Proved
Oil and Gas Reserve Quantities;
Enumerate the sources of change required to be
reportedly separately if individually significant;
Analyse the reason for changes under the following:
Sales and transfers
Extensions, discoveries, and improved recovery
Estimated future development costs
Development costs incurred during the period that reduce future
development costs
Revision Quantity
Accretion of discount;
Give examples of payment considered as fiscal system;
Explain concessionary system and give the obligations and rights
of parties therein;
Identify the owner of the tile the oil or gas under the
concessionary system;
Identify the parties in a concessionary agreement;
Determine the extent of the participation if the government in
concessionary agreements;
Describe the applicable rules under the contractual system;
Identify the role of the government in a contractual system;
Know what triggered the existence of production sharing contract
(PSC);
Specify the common feature of concessionary agreements and PSC;
Define a signing or signature bonus and production bonus;
Explain why the inclusion of royalty provision is considered as
an interesting feature of production sharing
contracts;
Know how some PSC’s allowed the government to participate in oil
and gas projects;
Enumerate the information required to be specified under the
contract relative to cost recovery;
Enumerate the common order of cost recovery;
Explain what constitute profit oil or profit gas;
Explain capital uplifts, ringfencing, domestic market obligation
and royalty holidays and tax holidays;
Distinguish between risk service contracts and nonrisk service
contracts;
View a model form of international joint operating agreement;
Differentiate recoverable and non-recoverable costs;
Differentiate financial accounting and contract accounting;
Enumerate the issues to be resolved to compute entitlement
reserves;
State the importance of reporting the company’s net prove
reserves separately;
Explain the relevance of International Financial Reporting
Standards (IFRS) in addressing accounting issues in
the upstream oil and gas industry;
Give the difference between the financial statements of an oil
and gas industry with the other industries;
Identify the primary source of data necessary to compute most of
the ratios unique to oil and gas companies;
Cite the different purposes in evaluating financial statements
and other reports;
Determine the relevance of benchmarking in the oil and gas
industry;
Specify the functions of reserve replacement ratio;
Specify the function of reserve life ratio;
Define gross wells and net wells;
Determine the use of ratio of net wells to gross wells;
Know how average reserves per well ratio evaluate a company’s
future profitability;
Compute the daily production per well;
Identify the basis of reserve cost ration;
Determine what makes calculating and using the finding cots per
BOE (based on energy content) ratio difficult;
Know the basic formula for computing BOE;
Distinguish DD&A from lifting costs;
Be familiar with the formula for computing value of proved
reserve additions per BOE;
Know the importance for maximising the value added ratio;
Enumerate the different ratios that are frequently used in the
financial statement analysis;
Determine the formula for the following:
Current ratio
Quick ratio
Working capital
Debt to stockholders equity
Debt to assets
Times interest earned
Net income to sales
Return on stockholder’s equity
Return on assets
Cash flow from operations to sales
Price/earnings ratio
Price/cash flow ration
Programme Contents, Concepts and Issues
Module 1
Strategic Management, Project Management, Organisational Analysis
and Design Course
M1 – Part1: Organisational Analysis an Internal View
Definition
of Organisation
Organisational Objectives,
The Collegium
Organisational Tasks
Division of Work/Labour
Delegation of Role, Task, Power, Authority in a
Project Management and General Organisational
Setting
Responsibility for Task Performance in an
Organisation-Wide Context and Project Setting
Organisational Accountability: Internal and External
Internal Accountability: Worker Accountability to
Team Managers and Project Leaders
Authority
Two Facets of Authority
The Second Facet of Authority
Traditional Authority
Legitimate Authority
Professional Authority
Power
M1 – Part 2:
Organisational Analysis: A Strategic View
External Organisational Accountability
Accountability to Owners/Sponsors
Accountability to Clients/Users/Customers
Accountability to Creditors
Accountability to Sector or Industry
Accountability to the State – Government, Generally; Regulatory Authorities (E.g.
Office of Fair Trading, Competition Commission,
Trading Standards, Sector Regulators, City
Regulators
M1 –
Part 3: Organisational Analysis: A Strategic View
Organisational Internal Analysis:
Organisational Strengths and Weaknesses Analysis
Organisational External Analysis: Opportunities and
Threats Analysis
Strengths, Weaknesses, Opportunities and Threats
(SWOT) Analysis
External Global Analysis; Local, National, Global
Analyses of PEST Factors or LONGPEST Analysis
Political, Economic, Social, Technological,
European, Legal Analysis or PESTEL Analysis
M1 –
Part 4: Methods of Data Gathering
Questionnaire, Interview and Scalar Checklist Design
Information Gathering: Documentary Analysis, Conversation
Analysis and Interviewing,
Levels of Participant Observation
The Complete Participant As Observer: Making ‘Detached
Observations’
Information Processing: Data Analysis and Interpretation
M1 –
Part 5: The Individual in a Dynamic Environment
Individual Strengths and Weaknesses Analysis
Work Pressure as a ‘Stressor’
Dealing with Work Pressure
Time Management and ‘Accounting Throughput’
Pragmatic Assertiveness: Improving Your Ability to
Question and Challenge
M1 –
Part 6: Encouraging Lateral Thinking
Brainstorming,
Forced Associations,
Metaphors,
Analogies
M1 –
Part 7: An Introduction to Strategic Management
Strategy: A Definition
The ‘Strategy Process’
What Makes Effective Strategy?
Defining Strategic Management
Three Core Areas of Strategic Management
Strategic Analysis
Strategic Development
Strategy Implementation
Three Elements of the Strategic Decision
Five Key Elements to Strategy
Levels of Strategy:
Corporate Level
Business Level
What Makes “Good” Strategy?
Two Main Test Areas for Strategy
Application-Related
Academic Rigour
Prescriptive Model of Business Strategy
Emergent Model of Business Strategy
What Is Green Strategy and Where Does It Fit In?
Why Do Companies Fail?
M1 –
Part 8: Analysing the Strategic Environment
Analysis of the Main Elements of the Environment
Analysing the Strategic Environment
The Ten Basic Analytical Tools
Steps in Taking the Analytical Tools
Customer Profiling
Segmentation and Positioning
Analysing the Strategic Environment: The Ten Basic
Analytical Tools
How Do We Analyse The Strategic Environment?
Five Political Trends That Have Affected Strategic
Management
Government and Industrial Policy
M1 –
Part 9: Strategy Dynamics: Prescriptive Purpose
Delivered Through Mission, Objectives and Ethics
What Is Strategy Dynamics?
Various Approaches of Strategy Dynamics
Understanding the Organisation’s Purpose
Developing the Purpose of the Organisation
Identifying a Vision for the Future
Coping With Stakeholder Power
Developing Corporate Governance, Ethics and
Corporate Social Responsibility (CSR)
What is Corporate Governance?
Ethics and CSR
Developing The Organisation’s Mission and Objectives
How to Formulate A Mission Statement
“What’s The Difference between Visions, Mission and
Objectives?”
How to Develop Objectives
Mission and Objectives: Prescriptive and Emergent
Approaches
Purpose and Quality Issues
Total Quality Management (TQM)
Project Totality: A Systems View of Project
Management
M1 –
Part 10: Project Life Cycle
Planning – Conceptualisation, Analysis, Proposal,
Justification, Agreement
Doing – Start-Up, Execution, Completion, Hand Over
Checking – Review
Acting – Feedback
Development of a Project Life Cycle, Project Brief
and Proposal
The Management of Change
The Systems Approach to Project Management
The Requirements of Successful Project Management
Balancing Costs and Benefits
Managing the Planning Process
Critical Incident Analysis
Project Control Mechanism
The Value Chain: Adding Value to Processes, Products
and Processes
Project Decision-Making
Project Coordination: The 5 Bases of Co-Ordination
Developing A CATWOE Focus of Project Management
M1 –
Part 11: Project Management: Approaches and
Methodologies
An Introduction to Structured Systems Analysis and
Design Method (SSADM)
Feasibility Study
Project Definition and Profile
Deciding on Analytical and Project Approach
Analytical Toolkit
Project Methodologies – Iterative Through to
Waterfall
Joint Application Design (JAD)
Process Re-Engineering
RUP
Rapid Application Development (RAD)
Process Mapping/Modelling
CASE
Facilitation/Workshop
Data Modelling
Strategy
Creativity Reviewing
The Bigger Picture
Objectivity
Testing Techniques
Prototyping
Cause and Effect Analysis
Root Cause Analysis
M1 –
Part 12: Motivating Workers in a Project Setting
Directing or Leading
The Concept of Motivation
Theories of Motivation
Equitable Reward Systems
Designing an Effective Motivation Strategy
The Collectivist vs. the Individualist Perspective
of Motivation
Common Trends in Motivation Theories
M1 –
Part 13: Organisational Design: Structuring and
Restructuring Organisations
An Introduction to Organisational Design: Approaches
to Organisational Design - Classical, Neo-Classical
and Contingency Approaches
Organisational Structure: Internal and External
Relationships. Vertical and Horizontal Relationships
Lines of Authority and Accountability
The Functional Structure
The Divisional Structure and Its Internal
Relationships
Basis of Divisionalisation
The Divisional Structure Compared with the
Functional Structure on the Basis of Communication,
Co-Ordination, Autonomy, Control and Flexibility
The Organisation of the Matrix Structure
Decision-Making and Communication Patterns in
Functional, Divisional and Matrix Structures
Compared
Module 2
Upstream Oil and Gas Accounting and Contracts: Oil and Gas Operation,
Mineral Rights, Leases and Successful Efforts
Accounting
M2 - Part 1:
Upstream Oil and Gas Operations
Introducing the Oil And Gas Industry
Brief History of the U.S. Oil and Gas Industry
Origin of Petroleum
Anticline
Exploration methods and procedures
3-D Seismic
4-D Seismic
Acquisition of mineral interests in property
Mineral Rights
Mineral Interests
Fee Interests
Overriding Royalty Interests (ORI)
Retained ORI production payment Interest (PPI)
Dutch Carved-out production payment
Carved-out net profits interest created from working interest
Net profits interest created from mineral interest
Oil, Gas and Mineral Lease Provisions
Lease bonuses
Royalty provision
Primary term
Delay Rental Payment
Shut-In payment
Right to Assign Interest
Right to free use of resources for lease operations
Option payment
Offset Clause
Addressing problems and issues associated with upstream oil and
gas operation.
M2 - Part 2: Introduction to Oil and Gas Accounting
(1)
Oil and Gas Drilling Operations
BOP (blowout preventer)
Bottom-hole pressure
Bottom-hole pump
Drill string
Rat hole
Mouse hole
Drilling platform
Drilling rig
Proved area
Drill stem test
Derek and Derek Hands
Cracking
Field
Christmas tree
Sedimentary rock
Seismic exploration
Development well Flowing well
Injection well
Offset well
Stratigraphic Well
M2 - Part 3: Introduction to Oil and Gas Accounting
(2)
Stratigraphic Test Well or
Exploratory well
Service well
Dry hole
Dual completion
Dry natural gas
natural and artificial lifts
Oil and Gas production and Sales
Some State and US Federal Oil and Gas Drilling Regulation
Maximum Efficiency Drilling Rate (MER)
The Concept of Peak Oil
Historical cost accounting methods
Historical Development of accounting methods and current status
Introduction to successful efforts accounting
Chart accounts for successful efforts company
Oil and Gas subsectors – Upstream, Mid-Stream and Downstream
Horizontal, Vertical and Full Integration within the Oil and Gas
Industry.
Addressing Problems associated with Oil and Gas Accounting
M2 - Part 4: Nondrilling Exploration Costs –
Successful Efforts
Introduction to Full Cost (FC) Accounting
Distinguishing between Non-drilling and Drilling Costs
Cost of Identifying areas that might warrant exploration
Cost of topographical, geological and geophysical studies
Cost of carrying and retaining undeveloped properties
Dry hole contribution
Cost of drilling and equipping exploratory well
Cost of drilling exploratory type Stratigraphic test well
Successful Efforts– Exploration Cost
Accounts for a full cost company
G&G costs
Reconnaissance survey
Detailed Survey
Shooting Rights
Obtaining G & G Permits
Exchanging C & G Studies for Property Interest
M2 - Part 5: Acquisition Costs of Unproved Property
– Successful Efforts
Carrying and retaining costs
Delayed Rental Property Taxes
Legal cost for title defense
Clerical and record-keeping costs
Test-well contributions
Dry hole contribution
Bottom-hole contribution
Support equipment and facilities
Problems
Offshore and International operations
Purchase in fee (Fee Purchase)
Internal costs
Options to lease
Delinquent taxes and mortgage payment
M2 - Part 6: Acquisition Costs of Unproved Property
– Successful Efforts
Successful Efforts Acquisition Costs
Internal Costs
Options to lease
Delinquent tax and Mortgage Payments
Top Leasing
Amortization
Amortization of exploration and development costs of proved
developed reserves
Impairment
Disposition of capitalized costs – impairment of unproved
properties
Disposition of capitalized costs – surrender or abandonment of
property
Post balance sheet events
Disposition of capitalized costs – reclassification of an
unproved property
Land department
Addressing Issues and Problems in unproved property acquisition
costs
Module 3
Advanced Oil and Gas Accounting: International Petroleum Accounting
(1)
M3 - Part 1: Accounting Concepts
The Money Measurement Concept
The Entity Concept
The Going Concern Concept
The Dual Aspect Concept
The Accounting Period Concept
Materiality (Proportionality) Concept
The Conservatism Concept
Consistency Concept
The Realization Concept
The Matching Concept
The Cost Concept
M3 - Part 2: Financial Governance and
Standardization Institutions
Financial Accounting Standard Board (FASB)
The Security and Exchange Commission (SEC).
Accounting Standards Board (ASB)
International Accounting Standards Committee (IASC)
International Accounting Standards Committee
Foundation (IASCF)
International Financial Reporting Standards (IFRS)
Industry Specific Oil and Gas Accounting Standards
Generally Acceptable Accounting Principles (GAAP)
for Oil and Gas Producing Activities
Oil Industry Accounting Committee (OIAC)
M3 - Part 3: Drilling Development Costs – Successful
Efforts
Income
tax accounting for drilling costs
IDC vs. Equipment
Intangible Drilling Costs (IDC)
Up to an including the installation of Christmas Tree
Prior to Drilling
G & G
Preparation of Site
During Drilling
Drilling contractor’s charges
Drilling mud, chemicals, cement, supplies
Fuel
Wages
Well testing
At Target depth and during completion
Well testing
Perforating and cementing
Swabbing, acidizing and fracturing
Labour related to the installation of subsurface equipment
Plugging and abandoning cost – for dry wells
After Christmas tree – following completion
Removal of Drilling Rig
Restoration of land and damages paid to surface owner
Wells other than Exploration and development Wells
Intangible costs for extending well (see lists 1 & 2, above)
Intangible costs incurred in drilling water supply and injection
wells
Intangible costs incurred in drilling water and injection – where
water well is being used to for exploration and
development well or for injection.
Financial accounting for drilling and development costs
Well classification
Exploratory well
Service well
Stratigraphic test well
Proved developed oil and gas reserves
Proved undeveloped reserves
Successful Efforts, exploration costs
Exploratory drilling costs
Development drilling costs
Stratigraphic test wells
AFE’s and drilling contracts
Special drilling operations and problems
Workovers
Damaged or lost equipment and materials
Fishing and side tracking
Abandonment of portions of wells
Additional development costs
Development costs
Costs of gaining access and preparing well location for drilling
Costs of drill and equip development well, development-type
Stratigraphic test well
Cost of acquiring , constructing and installing production
facilities, e.g. lease
Support equipment and facilities
Drilling and development seismic
Post-balance sheet events
Accounting for suspended well costs
Interest capitalization
Offshore and international operations
Problems and Issues Associated with Successful Efforts Accounting
for Drilling Development Cost
M3 - Part 4: Proved Property Cost Disposition –
Successful Efforts
Costs of Property
Cost of lease and well equipment
Cost disposition through amortization
Reserves owned or entitled to
DD&A calculation
DD&A on a field-wide basis
DD&A when oil and gas reserve are produced jointly
Estimated future dismantlement, site restoration, and abandonment
costs
Exclusion of costs or reserves
Depreciation of support equipment and facilities
Cost disposition – nonworking interests
Revision of DD&A rates
Cost disposition through abandonment or retirement of proved
property
Successful efforts impairment
Problems
M3 - Part 5: Full Cost Accounting
Principles of Full Cost Oil and Gas Accounting
Disposition of capitalized costs
Inclusion of estimated future development expenditures
Inclusion of estimated future decommissioning costs
Exclusions of costs
Impairment of unproved properties costs
Abandonment of properties
Reclassification of properties
Support equipment and facilities
DDA&A under successful efforts versus full cost
Reserves in place – purchase
Interest capitalization
Limitation on capitalized costs – a ceiling
Asset retirement obligations
Deferred taxes
Income tax effects
Assessment of the ceiling test
SFAS No. 144 and Full Cost Ceiling Cost
Post-balance sheet events and the ceiling test
Problems and Issues associated with Full Cost Accounting
M3 - Part 6: Accounting For Production Activities
(1)
Accounting treatment
Cost of production versus inventory
Recognition of inventories
Lower-of-cost-or-market valuation
Accumulation and allocation of costs
Individual production costs
Secondary and Tertiary recovery
Gathering systems
Saltwater disposal systems
Tubular goods
Severance taxes
M3 - Part 7: Accounting For Production Activities
(2)
Production cost statements
Joint interest operations
Decision to complete a well
Project analysis and investment decision making
Payback method
Accounting rate of return
Net present value method
Internal rate of return
Profitability index
Problems and Issues associated with Accounting For Production
Activities
Module 4
Advanced Oil and Gas Accounting: International Petroleum Accounting
(2)
M4 - Part 1: Accounting For Asset Retirement
Obligations and Asset Impairment
Accounting For Asset Retirement Obligations
Scope Of SFAS No. 143
Legally Enforceable Obligations
Obligating Event
Asset Recognition
Initial Measurement – Fair Value
Traditional Approach
Expected Cash Flow Approach
Credit-Adjusted Risk-Free Rate
Market Risk Premiums
Subsequent Recognition and Measurement
Changes Due to the Passage of Time
Interest Method of Allocation
Funding and Assurance Provisions
Gain or Loss Recognition Upon Settlement
Changes Due to the Revisions in Estimates
Reassessment
Funding And Assurance Provision
Conditional AROs
Reporting And Disclosures
Accounting for the Impairment and Disposal of
Long-Lived Assets
Scope
Asset Groups
Long-Lived Assets to be Held and Used
Indications of Impairment
Testing For Recoverability
Measuring Impairment
Long-Lived Assets To Be Disposed of:
Long-Lived Assets To Be Disposed of Other Than by
Sale
Long-Lived Assets To Be Disposed of By Sale
Disposal Groups
Impairment For Full Cost Companies
Problems and Exercises Associated With Accounting
for Asset Retirement Obligations and Asset
Impairment
M4 - Part 2: Accounting For Revenue from Oil and Gas
Sales
Definitions
API Gravity
BS & W
Btu.
Casing Head Gas
Casing Head Gas.
City Gate
Commingled Gas.
Dissolved Gas
Field Facility
Gas Balancing Agreement
Gas Settlement Statement
Gauging
Heater-Treater
LACT Unit
Local Distribution Company (LDC).
Mcf
Natural Gas
Non-Associated Gas
Tapping
Thief
Tank Strapping
Separator
Measurements and Sale of Oil and Natural Gas
Crude Oil Measurement
Run Ticket Calculation
Crude Oil Sales
Natural Gas Measurement
Natural Gas Sales
Standard Division Order
Determination Of Revenue
Utilizations
Oil And Gas Revenue
Recording Oil Revenue
Crude Oil Exchanges
Recording Gas Revenue
Vented or Flared Gas
Non-Processed Natural Gas
Natural Gas Processing
Stored Natural Gas
Take-Or-Pay Provisions
Timing of Revenue Recognition
Revenue From Crude Oil
Revenue From Natural Gas
Revenue Reporting To Interest Owners
Additional Topics
Gas Imbalances
Producer Gas Imbalances
Pipeline Gas Imbalances
Allocation of Oil and Gas
Minimum Royalty – An Advance Revenue to Royalty
Owners
Addressing Problems and Issues Associated with
Accounting for Revenue from Oil and Gas Sales
M4 - Part 3: Pertinent Oil and Gas Tax Accounting
Lessee’s Transactions
Non-Drilling Costs
Acquisitions Costs
Drilling Operations
Equipment Costs
Production Operations
Losses From Unproductive
Percentage Depletion
Property
Recapture of IDC and Depletion
Lessor’s Transactions
Acquisition Costs
Revenue
Addressing Problems And Issues Associated With
Basic Oil And Gas Tax Accounting
M4 - Part 4: Joint Interest Accounting
Joint Operations
Joint Venture Contracts
The Joint Operating Agreement
The Accounting Procedure
General Provisions: Accounting Procedure -
Definitions
Affiliate
Agreement
Controllable Material
Equalized Freight
Excluded Amount
Field Office
First Level Supervision
Joint Account
Joint Operations
Joint Property
Laws
Material
Non-Operators
Offshore Facilities
Off-Site
On-Site
Operator
Parties
Participating Interest
Participating Party
Personal Expenses
Railway Receiving Point
Shore Base Facility
Supply Store
Technical Services
Statements and Billings
Advances and Payments by Parties
Adjustments
Expenditure Audits
Approval by Parties
General Matters
Amendments
Affiliates
Direct Charges
Rentals and Royalties
Labour
Material
Transportation
Services
Equipment and Facilities Furnished by Operator
Affiliates
Damages and Losses To Joint Property
Legal Expense
Taxes And Permits
Insurance
Communications
Ecological, Environmental, and Safety
Abandonment and Reclamation
Other Expenditures
Overhead
Overhead – Drilling and Producing Operations
Technical Services
Overhead – Fixed Rate Basis
Overhead – Percentage Basis
Overhead – Major Constructions and Catastrophe
Amendment of Overhead Rates
Material Purchases, Transfers, and Dispositions
Direct Purchases
Transfers
Pricing
Freight
Taxes
Condition
Other Pricing Provisions
Dispositions And Surplus
Special Pricing Provisions
Premium Pricing
Shop-Made Items
Mill Rejects
Inventories of Controllable Material
Directed Inventories
Non-Directed Inventories
Operator Inventories
Non-Operator Inventories
Special Inventories
General Provisions
Definitions
Statements and Billings
Advances and Payments by the Parties
Adjustments
M4 - Part 5: Joint Interest Accounting: Direct
Charges, Materials, Offshore Operations and Audits
Direct Charges
Account
Direct Costs
Rentals and Royalties
Labor, Materials and Supplies
Transportation
Services
Exclusively Owned Equipment and Facilities of The Operator
Affiliates
Damages and Losses
Legal Expenses
Taxes, Licenses, Permits, Etc
Insurance
Communications
Ecological and Environmental Costs
Abandonment and Reclamation
Offices, Camps, and Miscellaneous Facilities
Other Costs
Pricing of Joint Account Material Purchases, Transfers and
Dispositions
Charges To Joint Interest Accounting
Booking Charges to the Joint Account: Accumulation of Joint Costs
in Operator’s Regular Account
Booking Charges to the Joint Account: Distribution of Joint Costs
as Incurred
Non-Consent Operations
Accounting for Materials
Offshore Operations
Joint Interest Audits
Module 5
Advanced Oil and Gas Accounting: International Petroleum Accounting
(3)
M5 - Part 1: Conveyancing For Oil and Gas Operation
Mineral interests
Types of interest
Basic Working Interests (WI)
Joint Working Interest
Basic Royalty Interest (RI)
Overriding Royalty Interest (ORI)
Production Payment Interest (PPI)
Net profit Interest
Conveyances: General Rules
Conveyances: Exchange and Poolings
Farm – ins/farm outs
Farm – ins/farm outs with a reversionary working
interest
Free wells
Carried interests or sole risk
Joint venture operations
Poolings unitizations
Unitizations
Participation Factors
Computation of Barrels for payout
Computation of proved Reserves
Computation of proved developed reserves
Conveyances: Sales
Unproved property sales
Sales of entire interest in unproved property
Sales of partial interest in unproved property
Proved property sales
Sales and purchases of a partial interest in proved property
Sales of working interest in a proved property with retention of
nonworking interest
Conveyances: production payments
Retained production payments
Retained production payments payable in money – reasonably
assured
Retained production payments payable in money – not reasonably
assured
Carved-out production payments payable in product or
volumetric production payment (VPP)
Conveyances-full cost
Problems and Issues associated with Conveyance
M5 - Part 2: Oil and Gas Disclosures
Required disclosures
Illustrative example
Proved reserve quantity information
Reserve definitions
Proved reserves
Proved developed reserves
Proved undeveloped reserves
Use of end-of-year prices
Reserve quantity disclosure
Capitalized costs relating to oil and gas producing
activities
Costs incurred for property acquisition,
exploration, and development activities
Results of operations for oil and gas producing
activities
Standardized measure of discounted future net cash
flows relating to proved oil and gas reserve
quantities
Future cash inflows
Future development and production cost
Future income tax expenses
Future cash flows
Discount
Changes in the standardized measure of discounted
future net cash flows relating to proved oil and gas
reserve quantities
Analysis of reasons for changes in value of
standardized measure 12/31/XB
Sales and transfers, net of production costs
Changes from extensions, discoveries, and improved
recovery
Changes in estimated future development costs
Development costs incurred during the period that
reduce future development costs
Analysis of changes in development costs
Revision Quantity
Accretion of discount
Conclusion
Problems and issues that address Oil and Gas
Disclosures
M5 - Part 3: Accounting For International Petroleum
Operations
Petroleum fiscal systems
Concessionary systems
Concessionary agreements with government
participation
Contractual systems
Government involvement in operations
Government participation
Back in
Production sharing contracts
Signature and production bonuses
Royalties
Government participation
Cost recovery
Profit Oil
Other terms and fiscal incentives
Service Contracts
Joint operating agreements
Recoverable and non-recoverable costs
Financial accounting issues
Financial accounting versus contract accounting
International accounting standards
Problems
M5 - Part 4: Analysis of Oil and Gas Companies’
Financial Statements
Contractual systems
Government involvement in operations
Production sharing contracts
Signature and production bonuses
Royalties
Government participation
Cost recovery
Profit oil
Other terms and fiscal incentives
Capital uplifts
Ringfencing
Domestic market obligation
Royalty holidays and tax holidays
Service contracts
Joint operating agreements
Financial Accounting Issues
Financial accounting VS Contract Accounting
Disclosure of proved reserves – SFAS No. 69
Disclosure of reserves
International Accounting Standards
M5 - Part 5: Analysis of Oil and Gas Companies’
Financial Statements
Source of Data
Historical cost-based
Future value-based
Production
Productive wells and acreage
Undeveloped acreage
Drilling activity
Present activities
Delivery commitments
Comparing financial reports
Reserve ratios
Reserve replacement ratio
Reserve life ration
Net wells to gross wells ratio
Average reserves per well ratio
Average daily production per well
Reserve cost ratios
Finding costs ratios
Lifting costs per BOE
DDA&A per BOE
Reserve value ratios
Value of proved reserve additions per BOE
Value added ratio
Financial ratios
Liquidity ratios
Current ratio
Quick ratio
Working capital
Financial strength ratios:
Debt to stockholder’s equity
Debt to assets
Times interest earned
Profitability ratios
Net income to sales
Return on stockholder’s equity
Return on assets
Cash flow from operations to sales
Price/earnings ratio
Price/cash flow ratio
