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<p>Acknowledgments xi</p> <p>1 An Introduction to Energy Finance and Economics 1<br /><i>Betty J. Simkins and Russell E. Simkins</i></p> <p><b>Part One </b><b>An Overview of Energy Finance and Economics</b></p> <p>2 Geopolitics and World Energy Markets 19<br /><i>Robert W. Kolb</i></p> <p>3 Energy Economics: Past, Present, and Prospects for the Future 49<br /><i>James L. Williams and Betty J. Simkins</i></p> <p>4 Sustainable Energy: Myths and Realities 79<br /><i>Olamide O. Shadiya, Jane A. Talkington, John Mowen, </i><i>Karen High, and Josh L. Wiener</i></p> <p>5 A Brief Introduction to the Petroleum Industry: From Crude Oil and Natural Gas to Petrochemicals and Their Products 107<br /><i>Russell E. Simkins and Kenneth A. Borokhovich</i></p> <p>6 The Economics of Renewable Energy 129<br /><i>Brad Carson</i></p> <p>7 How Our Political Views Affect Our View of Energy Prices 145<br /><i>Sheridan Titman</i></p> <p><b>Part Two </b><b>Financial and Economic Analysis in the Energy Industry</b></p> <p>8 Oil and Gas Accounting 151<br /><i>L. Charles Evans III</i></p> <p>9 Financial Statement Analysis for Oil and Gas Companies and Competitive Benchmarking 181<br /><i>Siamak Javadi, Betty J. Simkins, and Mary E. Wicker</i></p> <p>10 Petroleum Economics, Risk and Opportunity Analysis: Some Practical Perspectives 229<br /><i>David A. Wood</i></p> <p>11 Real Options and Applications in the Energy Industry 253<br /><i>Betty J. Simkins and Kris Kemper</i></p> <p>12 International Petroleum Fiscal System Design and Analysis 269<br /><i>David Johnston</i></p> <p>13 Financing Large Energy Projects 313<br /><i>Stephen V. Arbogast and Praveen Kumar</i></p> <p>14 Financing Bio-Fuels Projects: Case Study Lessons 343<br /><i>Stephen V. Arbogast</i></p> <p><b>Part Three </b><b>Energy Risk Management and Related Topics</b></p> <p>15 Energy Derivatives and Markets 365<br /><i>Craig Pirrong and Mohsen Mollagholamali</i></p> <p>16 Introduction to Energy Risk Management 379<br /><i>Ivilina Popova and Betty J. Simkins</i></p> <p>17 Risks in Trading Energy Commodities 411<br /><i>Divya Krishnan</i></p> <p>18 Carbon Management and Environmental Issues 425<br /><i>Evgenia Golubeva</i></p> <p>19 Hedging and Value in the U.S. Airline Industry 443<br /><i>David A. Carter, Daniel A. Rogers, and Betty J. Simkins</i></p> <p><b>Part Four </b><b>Case Studies</b></p> <p>20 PKO Resources, Inc.: Valuing a Producing Oil and Gas Property 467<br /><i>John D. Martin, J. Douglas Ramsey, and Sheridan Titman</i></p> <p>21 Financial Analysis of the Purchase of a Hybrid Consumer Vehicle 477<br /><i>Don M. Chance, Pratik Dhar, and Betty J. Simkins</i></p> <p>22 ExxonMobil Corp.’s Acquisition of XTO Energy, Inc.: An Exercise in Valuation 491<br /><i>Allissa A. Lee and Betty J. Simkins</i></p> <p>23 Southwest Airlines: The Blended Winglet Project 513<br /><i>Aaron Martin, Daniel A. Rogers, and Betty J. Simkins</i></p> <p>24 Wind Energy Power Company, Inc. (A): Analyzing a Wind Energy Investment 525<br /><i>John D. Martin, J. Douglas Ramsey, and Sheridan Titman</i></p> <p>25 A Case Study on Risk Management: Lessons from the Collapse of Amaranth Advisors LLC 543<br /><i>Ludwig Chincarini</i></p> <p>Index 579</p>

<p><b>BETTY SIMKINS, PhD,</b> is the Williams Companies Professor of Business and a Professor of Finance in the Department of Finance at Oklahoma State University’s (OSU) Spears School of Business. She teaches energy finance, a course that she developed, at both the undergraduate and graduate levels, and also teaches executive education courses on energy finance for companies globally. Her primary area of research is risk management, including energy risk management, and she has published extensively in this area. Simkins has received a number of teaching awards at OSU, including the Regents Distinguished Teaching Award. She currently serves on the Board of Directors for the Financial Management Association, as coeditor of the <i>Journal of Applied Finance</i>, editor of <i>FMA Online</i>, and as past president of the Eastern Finance Association. Simkins worked in the corporate world for ConocoPhillips and Williams Companies.</p> <p><b>RUSSELL SIMKINS</b> is Manager of Proposal Services in the College of Engineering, Architecture, and Technology at Oklahoma State University (OSU) and a licensed Professional Engineer in the state of Oklahoma. He has over thirty years of engineering experience and worked for ConocoPhillips, Fractionation Research Inc., Lubrizol Corporation, Southwest Research Institute, and the U.S. Department of Energy. Simkins has also been active in the engineering profession as a member of various working groups in the Society of Automotive Engineers (SAE), Coordinating Research Council (CRC), and American Society of Testing Materials (ASTM) dealing with fuels and lubricants.</p>

<p>When it comes to the issue of energy finance and economics, there are many opinions out there, but what’s really needed in order to gain a realistic understanding of this field are accurate and unbiased facts. That’s why <i>Energy Finance and Economics</i>, part of the Robert W. Kolb Series in Finance, has been created.</p> <p>Engaging and informative, this reliable guide contains the latest insights regarding the finance and economics of energy based on contributions by practitioners and academics who are experts in these areas. It’s intended to bridge the gap between the scientific and technological foundations of energy and the real-world applications in the fields of finance and economics. <p>Divided into four comprehensive parts—with each chapter containing review questions to help reinforce key concepts—this book offers extensive coverage in the areas of valuation, analysis, and risk management, and includes timely discussions about the future of energy. Page by page, it addresses the most essential issues associated with energy finance and economics, and will help you: <ul><li>Gain valuable knowledge regarding energy supply and demand, industry structure, the myths and realities about sustainable energy, geopolitics and world energy use, and the drivers of energy prices</li> <li>Develop a better sense of value creation and decision-making in the energy industry</li> <li>Understand energy applications for best practices in financial analysis, including accounting standards that apply to oil and gas companies, capital budgeting and risk analysis for energy projects, and the economics of renewables</li><li>Become familiar with the various types of energy derivatives and markets, and utilize key hedging techniques useful to energy risk management</li> <li>Put the field in perspective with practical case studies related to energy financial analysis such as the economics of buying a hybrid vehicle; Southwest Airlines’ decision to retrofit their fleet of jets with blended winglets to save on fuel costs; and the economics of wind energy projects, among others</li> <li>And much more</li></ul> <p>Energy finance is a complex topic, but with this book as your guide, you’ll gain a broad understanding of it, and discover how it can be effectively applied in real-world situations.</p>

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