there any reasons to anticipate that Apache Corporation’s acquisition of MW Petroleum might be a positive net present value activity for Apache, for Amoco? Explain. This looks like an attractive deal for both parties. Amoco does many things well, but managing smaller, marginally productive oil and gas fields apparently isn’t one of them. This is a chance to unload some properties that because of their high cost structure, Amoco can’t manage profitably. Apache, on the other hand, has low costs
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there any reasons to anticipate that Apache Corporation’s acquisition of MW Petroleum might be a positive net present value activity for Apache, for Amoco? Explain. This looks like an attractive deal for both parties. Amoco does many things well, but managing smaller, marginally productive oil and gas fields apparently isn’t one of them. This is a chance to unload some properties that because of their high cost structure, Amoco can’t manage profitably. Apache, on the other hand, has low costs and
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The rationale of an Apache acquisition of MW Petroleum is plausible, yet there are outstanding concerns. By completing a deal, Apache stands to benefit from several aspects. First, MW isa large company which has more than double Apache’s reserves and it includesproperties that are well-suited to Apache’s operating capabilities. Moreover, on behalf of MW, Amoco operated fields accounting for approximately 80% of MW’s production. Such high operating percentage would promise Apache significant cost-saving
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REAL OPTION VALUATION: MW PETROLEUM I. Company background and description on each of 4 projects In 1991, Amoco Corporations, a conglomerate of petroleum and chemical corporations, decided to divest some of their smaller properties and when further cuts were needed, they looked to divest the middle section of assets in its marginal curve. As a result, they formed MW Petroleum, a free-standing exploration company that was even as large as some of independent oil companies. It operated exploration
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Management at Apache Corporation Outline Factual information Major Risks and Their Classification Measurement of Risks Goal and Value of Risk Management Tools for Risk Management Sources: “Risk Management at Apache", by Lisa Meulbroek and Puja Malhotra. Harvard Business School Case \# 9-201-113, revised on Aug 27, 2001. HBS 9-201113-PDF-ENG. Go to http://hbsp.harvard.edu/product/cases and search with Apache or 9-201113. “2013 Annual Report” filed by Apache and “Investor Day
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Question 1 – Enron Case: A. Fixed volume at fixed price. – Production companies who use the natural gas as a material in producing their final product. By fixing the price, they insure themselves from increasing prices and can forecast and meet their budgeted costs as well as budgeted profit margins. B. Fixed volume at price tied to a natural gas index. – Speculators who will engage in risky financial transactions in an attempt to profit from fluctuations in the market value of
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FI 4320, Spring 2005 Cases and Readings in Corporate Finance [pic] [pic] [pic] [pic] Instructor Professor David C. Nachman Office: RCB 1239 Phone: 651-1696 email: dnachman@gsu.edu Office Hours: W 10:00 am – 2:00 pm, or by appointment Prerequisites FI 4000 CSP: 1, 2, 4, 6 Course Description This course focuses on financial policy-making through case analyses, contemporary readings from the professional literature, and problem solving. The emphasis in the course is on
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FI 8320, Spring 2005 Cases and Readings in Corporate Finance [pic] [pic] [pic] [pic] Instructor Professor David C. Nachman Office: RCB 1239 Phone: 651-1696 email: dnachman@gsu.edu Office Hours: W 10:00 am – 2:00 pm, or by appointment Prerequisites FI 8000 CSP: 1, 2, 6 Course Description This course focuses on financial policy-making through case analyses, contemporary readings from the professional literature, and problem solving. The emphasis in the course is on investment
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Finance 725 Spring 2006 J. E. Hodder Corporation Finance Course Schedule Tuesday, January 17: Introduction Thursday, January 19: Clarkson Lumber Company Reading: Note on Financial Analysis a. How is the company's financial performance? (Examine appropriate financial ratios.) b. Why has Clarkson Lumber borrowed increasing amounts despite its consistent profitability? c. How has Mr. Clarkson met the financing needs of
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11/4/2013 Well Integrity: Hydraulic Fracturing & Well ConstructionWhat are the Factual Risks? George E. King Apache Corporation SPE Webinar 5 November 2013 History • Invented in era of 1943 to 1947 by Standard Oil of Indiana (Stanolin => Pan American => Amoco). • Fully commercial by 1954. • First multi-fractured deviated wells in 1975. • Million pound sand jobs in mid 1970’s • Million gallon fracs in mid 1980’s. • Horizontal multi-fractured shale wells in 1988. • Over 1 million
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