{"id":11075,"date":"2021-02-09T15:10:56","date_gmt":"2021-02-09T15:10:56","guid":{"rendered":"https:\/\/www.westwoodenergy.com\/?p=11075"},"modified":"2025-01-13T11:28:58","modified_gmt":"2025-01-13T11:28:58","slug":"commercial-advisory-case-study-private-equity-backed-ep-vehicle","status":"publish","type":"post","link":"https:\/\/www.westwoodenergy.com\/news\/case-studies\/commercial-advisory-case-study-private-equity-backed-ep-vehicle","title":{"rendered":"Commercial Advisory Case Study &#8211; Private Equity-backed E&#038;P Vehicle"},"content":{"rendered":"<h2><strong>Project Brief<\/strong><\/h2>\n<p><span style=\"font-weight: 400;\">The Client was considering a potential investment into a portfolio of mature to ultra-mature UKCS fields. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">The Client required an independent review of the asset portfolio including commercially recoverable resources, cessation of production, potential abandonment cost \/ liabilities and any potential upside that could be delivered through infrastructure synergies and further capital investments. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">The Client also wanted to understand other viable bidders for this asset portfolio, including a view of how inorganic growth aligned with their strategies and how complimentary the fields were to existing portfolios.<\/span><\/p>\n<h2><strong>Our Process<\/strong><\/h2>\n<p><span style=\"font-weight: 400;\">a) Understand the client business<\/span><\/p>\n<ul>\n<li><span style=\"font-weight: 400;\">Assessing the reasons \/ drivers behind the Client\u2019s proposed entry to the UKCS<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Understanding the Client\u2019s strategic goals and associated timeframe to achieve key objectives<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Reviewing perceived Client preferences for specific UKCS basins, and the reasons behind these preferences<\/span><\/li>\n<\/ul>\n<p>b) Understand the Client challenge, questions and problems to solve<\/p>\n<ul>\n<li><span style=\"font-weight: 400;\">Westwood worked with the Client to describe what \u2018good\u2019 looked like from an acquisition perspective<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Understand the drivers behind the potential investment and perceived benefits of acquiring the portfolio \u2013 e.g. stable production \/ cashflows, upside potential, ability to produce hydrocarbons with a lower operating cost than the incumbent E&amp;P Operator etc<\/span><\/li>\n<li><span style=\"font-weight: 400;\">The Client required an assessment of potential portfolio upside, both from further capital investment and from infrastructure synergies<\/span><\/li>\n<li><span style=\"font-weight: 400;\">An understanding of the magnitude of abandonment costs \/ liabilities associated with the portfolio &amp; the impact of this on remaining portfolio value was needed<\/span><\/li>\n<li><span style=\"font-weight: 400;\">The Client required a view on how competitive a bidding process could be, to guide its approach to the proposed transaction<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">c) Assess how we could help<\/span><\/p>\n<ul>\n<li><span style=\"font-weight: 400;\">Westwood proposed a bespoke study, underpinned by the <strong><a href=\"https:\/\/www.westwoodenergy.com\/atlas\">Atlas<\/a><\/strong> database<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Westwood provided a screening of all fields in the UKCS portfolio, including a review of remaining reserves, anticipated cessation of production date, ownership, facilities &amp; associated potential abandonment costs \/ liabilities. In addition, Westwood appraised the upside potential around each field, including a review of local pipeline infrastructure, discoveries and prospects<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Westwood used its extensive network in the <strong><a href=\"https:\/\/www.westwoodenergy.com\/sectors\/exploration-and-production\/northwest-europe\">Northwest Europe E&amp;P<\/a><\/strong> sector to glean insights into the strategy of key E&amp;P Operators that may participate in a bidding process<\/span><\/li>\n<\/ul>\n<h2><strong>The Outcome and Benefit<\/strong><\/h2>\n<p><span style=\"font-weight: 400;\">A bespoke study underpinned by <strong><a href=\"https:\/\/www.westwoodenergy.com\/atlas\">Atlas<\/a><\/strong>. This enabled the Client to:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Gain an in-depth understanding of the remaining value of the asset portfolio net of abandonment liabilities<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Gain an understanding of potential future upside to the asset portfolio, and where this upside may be found (e.g. UKCS infrastructure synergies and further capital investment)<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Gain an informed view on potential competitive bidders, based on careful assessment of the strategy &amp; existing portfolio of a selection of key companies likely to pursue inorganic growth<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">As a result of Westwood\u2019s analysis, the Client was able to confidently commence discussions with the vendor, based on a granular understanding of the strengths, weaknesses and opportunities associated with the UKCS portfolio.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Project Brief The Client was considering a potential investment into a portfolio of mature to&#8230;<\/p>\n","protected":false},"author":3,"featured_media":11141,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[326,350,40,75,48,338,334,336],"tags":[],"class_list":{"0":"post-11075","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-atlas","8":"category-business-division","9":"category-case-studies","10":"category-consultancy","11":"category-news","12":"category-nw-europe-subsectors","13":"category-solutions","14":"category-subsectors"},"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.1 - 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