MCFA is a woman-owned small business which specializes in reducing facilities costs. We apply our expertise in all the phases of facilities development: planning, implementation, and maintenance.

UBS Energy, LLC

Client:

UBS Energy, LLC

Project Location:

Santa Barbara, California

Issue:

Determine feasibility of potential loan repayment by an oil and gas company

Project Duration:

1 month

Solution

Performed a due diligence assessment of the oil and gas company’s assets and operations

Summary

An oil and gas company located in southern California desired additional funds in the form of a loan from UBS Energy LLC (UBS) to expand and improve its business operations. Payback of the loan would be based on a volumetric production payment (VPP) arrangement where UBS, through the VPP, would hold a royalty interest in the oil and gas company’s reserves and and receive specified quantities of oil and gas from the company on a regular basis.

As the VPP arrangement was predicated on the company’s proposed oil and gas expansion plan, UBS contracted MCFA in conjunction with EPIC Energy Resources (EPiC) to perform an operational due diligence assessment of the company’s oil and gas expansion plan; current operational conditions; historical performance; health, safety, and environmental conditions; and regulatory compliance issues. Personnel from both MCFA and EPiC performed site visits to the oil and gas company’s primary location and a majority of their leases, conducted interviews with on-site personnel, reviewed all documentation made available for review, and researched documentation not made available for review.

At the conclusion of these actions, the MCFA and EPiC team collaborated to produce a wide-reaching due diligence assessment of the oil and gas company’s assets and operations. This assessment enabled UBS to make an informed and educated decision as to whether entering into a VPP arrangement with this particular company would be a wise or a risky financial venture.

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