Aucerna Connects Webinar Series

We have followed Kosatka Energy through its portfolio journey.  Kosatka has a large set of investment opportunities and a clear strategic vision. In the series, we have seen Kosatka use portfolio analysis to examine their opportunities holistically, improve their valuation of A&D opportunities, identify how to increase value without additional capital investment, and identify and create options for further value. At the end of their journey, we will learn how Kosatka has leveraged portfolio analysis to not only build a strong strategic plan but a plan that is resilient and will see them through uncertain times.

On-Demand Webinars

Aucerna Portfolio Series: Episode Recordings 1 - 6

Presented by: Jeff Morgheim, Industry Consultant, Aucerna

Episode 1

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Episode 2

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Aucerna Webinar assess real value opportunities

Episode 3

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Episode 4

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Episode 5

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Episode 6

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Kosatka Energy

See below for detailed episode recaps!

Episode 1: No Opportunity is an Island – Why Standalone Economics Fail to Measure Value

In this episode, we watched Kosatka Energy use portfolio analysis to examine the value of its investment opportunities.  What Kosatka discovered is that a project’s value is not captured by stand-alone analysis, which is what traditional rank-and-cut approaches use.  In many cases, investment opportunities are not independent from one another.  In other cases, the uncertain outcomes of one investment have a bearing on another.  Kosatka was able to not only incorporate these dependencies in their strategic planning, they were also able to see how a particular project, their North Infill program, contributes to the overall value of the company in allowing it to reallocate resources to achieve the best corporate outcome.

Episode 2: You want how much? – Assess the Real Value of A&D Opportunities

In this episode, we saw that while Kosatka Energy has existing investment opportunities that will meet their strategic goals, they want to consider A&D opportunities that could further improve their value.  We watched how Kosatka used portfolio analysis to evaluate several acquisition opportunities as well as a large divestment opportunity.  By using portfolio analysis, Kosatka had a holistic view of what these opportunities meant for the company and placed them in a more powerful negotiating position with their potential buyers and sellers.

Episode 3: Capital Holding You Back? Maybe it is Constraints – The Value of Removing Constraints

In this episode, we watched Kosatka Energy use portfolio analysis to examine the value of its investment opportunities.  What Kosatka discovered is that a project’s value is not captured by stand-alone analysis, which is what traditional rank-and-cut approaches use.  In many cases, investment opportunities are not independent from one another.  In other cases, the uncertain outcomes of one investment have a bearing on another.  Kosatka was able to not only incorporate these dependencies in their strategic planning, they were also able to see how a particular project, their North Infill program, contributes to the overall value of the company in allowing it to reallocate resources to achieve the best corporate outcome.

Episode 4: Options? Yes, Please! – The Value of Creating Options

In this episode, we learn that Kosatka was unable to agree terms with the West Gamma partner to exit the project.  However, Kosatka was able to identify a way to manage the uncertainties of the West Gamma project by agreeing an option to not develop the second phase of the project if the first phase fell below certain performance expectations.  The ability to create this option to manage the project risks allowed Kosatka to reallocate its resources and grow overall value nearly as much as it would have grown by increasing its capital spend.  We saw that while Kosatka did not get all the value it hoped with a complete exit, it still generated considerable value, maintained the option to stay in the project, and preserve an important relationship.

Episode 5: The View from the Top is the Same – The Value of Creating Multiple Pathways

In this episode, we saw how Kosatka Energy has pulled all the pieces of its portfolio analysis to develop their strategic plan.  However, Kosatka’s journey was not quite completed.  We observed how Kosatka used portfolio analysis to evaluate multiple pathways to achieve its strategic goals.  In this episode, Kosatka asked questions such as:  Are there different strategies that we can follow to meet our goals?  What are the tradeoffs fo those different strategies?  What are the potential risks?  By the end of the episode, Kosatka selected a strategic path by which to steer the company.

Episode 6: What is Our Response? – How to Develop a Response Plan Before an Event Occurs

In our final episode of Kosatka Energy’s portfolio journey, we learn how Kosatka used portfolio analysis to evaluate the impact of uncertain outcomes of the opportunities on their strategic plan.  We see how they ask tough questions such as:  What are the impacts of favorable and unfavorable outcomes for our projects and opportunities?  Can we still meet your objectives if those events occur?  Can we create a response plan?  By the end of the episode, Kosatka confronts the possibility of major risk to one of its investment opportunities and using portfolio analysis, crafts a response plan.  With this final analysis in place, Kosatka was able to present to its shareholders a strategic plan that delivers on the company’s strategic vision and demonstrates resiliency in an uncertain world.

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