Our combination of economists, accountants and affiliated industry experts allows us to apply a wide range of expertise in both small and large energy asset valuations in the context of both transactions and disputes.
IEF has extensive experience in valuation and analysis of energy projects around the world. We have worked in cases that involve most areas of the energy industry: oil exploration and production, transportation, gas distribution, electricity networks, conversion of gas to diesel and fertilizer, coal production and conversion to diesel, etc.
Almost all energy valuations and disputes involve understanding energy markets, including oil and gas spot and derivative markets. Our combination of economists, accountants and affiliated industry experts allows us to apply a wide range of expertise in both small and large energy asset valuations in the context of both transactions and disputes. We are confident that, given our experience in the energy sector and with commodity markets can assist clients and lawyers in most energy industry matters.
The following list includes examples of the types of energy industry valuation projects on which we have advised.
- Upstream oil – Appointed to provide expert valuation reports and testimony in an international treaty arbitration claim that involved an oil field in one of the former Soviet Union Republics. Valued the option to delay exploration. Major issues included country risk and oil price forecasting.
- Midstream gas – Profitability assessment of a large gas supply contract between two European gas suppliers.
- Downstream gas – Prepared expert reports in regard to the valuation of losses allegedly borne by a foreign investor in a Caribbean Gas to Liquids (GTL) plant as the valuation expert appointed by the respondent. Addressed complex issues in regard to: adjusting for project feasibility risks, option pricing, Monte Carlo techniques and discount rates.
- Downstream gas – Appointed as a valuation expert for the claimant in an international treaty arbitration against the Bolivarian Republic of Venezuela. Valuation of losses borne by the claimant as a result of expropriation of gas-to-urea plant and offtake agreement.
- Midstream gas – Appointed by state and state-owned enterprises in a series of four contract and investor-state arbitrations that involve disputes over a terminated gas supply agreement between two Middle Eastern countries. Reports and expert evidence has been completed on three of these arbitrations, while the fourth is on-going.
- Upstream and downstream coal – Appointed to value the opportunity to develop a coal mine and a Coal to Liquids (CTL) plant in Western Australia using real options and applying a variant of the Monte Carlo technique.
- Downstream gas – Analysis of financial data to determine the cost of the residual element of a disputed contract covering engineering design work for a LNG plant in the Middle East.
- Electricity production and gas transportation – Financial analysis of the impact of regulatory regime changes on the profitability and value of gas-fired electricity generators and a gas transmission concession in Argentina.
- Electricity transmission – Financial analysis of the impact of tariff regime changes on the profitability and value of an electricity transmission concession in Argentina. Particular emphasis on the regulated asset value.
- Upstream oil – Expert reports on the valuation of an oil exploration and production company in light of allegations that a failed merger in the oil industry harmed the merging parties.
- Gas distribution – Financial assessment of a gas distribution concession in Argentina. Particular emphasis on volumes, ability to pay (given increases in consumer prices), the impact of customer arrears and the appropriate margin.
- Gas transportation – Financial assessment of a gas transportation concession in Argentina. Particular emphasis on volumes (given large swings in consumer prices), the impact of take-or-pay contracts and the appropriate margin.
- Electricity production and distribution – Advice to a Middle Eastern state electricity monopoly on the appropriate cost of capital for electricity pricing.
- Upstream oil – Financial analysis and due diligence of a critical supplier for an oil major. The supplier was one of a small number of potential suppliers for a critical service required by the oil major. The supplier’s balance sheet was relatively weak. As such, assessed the relative risk of extending new contracts to the supplier versus not doing so.
- Corporate governance – Consulting with a state-owned oil company on corporate governance of its insurance operations.
- Gas transportation, storage and distribution – Advised a California energy firm on allegations about manipulation of the gas market.