Metals and energy finance
20 - 24 November 2017
- Duration: 1 day, 2 days, 3 days or 5 days
1 day - £750
2 days - £1500
3 days - £2025
5 days - £3375
- Contact us
This new course was successfully launched in November 2016. Given the design component it involves, financial engineering should be considered equal to conventional engineering. By adopting this complementary approach, financial models can be used to identify how and why timing is critical in optimizing return on investment and to demonstrate how financial engineering can enhance returns to investors.
Metals and Energy Finance capitalizes on this approach, and identifies and examines the investment opportunities offered across the extractive industry’s cycle, from exploration through evaluation, pre-production development, development and production.
The course is made up with 3 modules:
There are some notable similarities between mineral and petroleum projects. Both are based on depleting resources and therefore companies are under constant pressure to replace reserves. The products are commoditised and globally traded on both spot and futures markets as well as being based on long-term contracts (iron ore, coal and gas supplies). These are products that have low demand elasticity, are capital intensive, require long development lead times and are associated with high technical and commercial risk. There are also environmental compliance and regulatory burdens associated with the development of all natural resource projects.
Thus course covers many of the concepts delivered as part of the MSc Metals and Energy Finance degree. This is a joint Faculty of Engineering and Business School programme and the structure of this course is based on its teaching modules. This course is based on the book Metals and Energy Finance published by Imperial College Press which is part of World Scientific which is an advanced textbook on the Evaluation of Mineral and Energy Projects.
The aim of the course is to develop strategic approaches for evaluating projects at the prefeasibility stage. Delegates will be provided with the training needed to establish an independent valuation of mineral projects. The course also aims to cover the underlying accountancy, financial and technical principles which apply to mineral projects, and to demonstrate how these influence the way a financial model is constructed. Particular attention will be given to the treatment of the key independent variables, such as grade, and dependent variables, such as grade-tonnage relationships, and the way these influence the rate of mining, associated costs and optimisation of the net present value of a project. The distinction between technical appraisal and financial engineering will also be addressed and the reason why discounted cash flow models need to be integrated correctly into financial accounts explained. This will be linked to concepts of shareholder value and the role of gearing to maintain an efficient balance sheet.
Day 1 is devoted to the principles behind Cash Flow modelling for both mineral and petroleum projects and is optional
A copy of the book Metals and Energy Finance will be provided as part of the course pack which will include copies of all PowerPoint slides used in the delivery. Please click here to view the book.
Who should attend?
The course will be of particular interest to all professionals involved in mining finance within the minerals industry and related financial services and investment communities. This includes those associated directly with the appraisal, financing, and developing of mining projects such as geologists and engineers with a technical orientation, as well as financial services sectors including mining analysts, fund and asset managers, brokers, investment bankers and accountants.
IC-MinEval and IC-CoalEval
In the workshop sessions use will be made in the workshop sessions of the IC-MinEval software, an Excel™-based spreadsheet programme automating all stages required to produce models for a wide range of mineral projects. The functionality of IC-MinEval will be delivered over the internet through the Software as a Service (SAAS) system with InfoMine (http://software.infomine.com/). Delegates will be expected to have their own laptop computers available and will be provided with wireless access to the Business School's internet. They will need to have administrative rights for their laptops, as there will be the need to install ActiveX to access the system. Delegates will be given access to SaaS a few days before the start of the course. (Delegates with AppleMac and Firefox internet browsers may need some support). Delegates all have access to the functionality of IC-MinEval through SaaS for a further three weeks after the course. Access beyond that will be available on subscriptions.
Participants will be able to retain digital copies of the spreadsheets that they generate during the course. It produces a Balance Sheet and Profit and Loss account from the cash flows, with tax provisions linked to the Profit and Loss account. Output modules include the base case discount cash flows, as well as key financial ratios and performance indicators such as NPV, IRR payback and maximum cash exposure. Sensitivity analysis can be undertaken on key variables.