Battling the Oil “Death Spiral”: ConocoPhillips vs. Antero Resources Corp.

Authors

  • Jimmy Senteza Drake University
  • Inchul Suh Drake University
  • Toby White Drake University

Keywords:

finance, oil and gas industry, valuation

Abstract

The interplay between global geopolitics and traditional supply and demand in the oil & gas industry is the heart of this fictionalized* case. In the context of falling global crude oil prices, two companies reliant on varying business models in their upstream undertakings are evaluated for inclusion in an investment portfolio. Learners get a deeper understanding of the pertinent value drivers in the valuation of oil & gas businesses and how they are captured. Limitations of employing traditional valuation methods become apparent and the final decision calls for deliberations beyond quantitative considerations.

* All people, places and financial data are fictionalized with the exception of direct quotations from publicly available documents.

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Published

2020-04-17

Issue

Section

Cases