Energy Investment Banking Interview
Questions and Answers | Latest
Version | 2025/2026 | Correct & Verified
What does energy investment banking primarily focus on?
✔✔ Advising energy companies on financing, mergers, and asset transactions
What types of companies are covered in energy investment banking?
✔✔ Oil, gas, power, utilities, and renewable energy companies
What is upstream in the energy sector?
✔✔ Exploration and production of oil and gas
What does midstream energy involve?
✔✔ Transportation, storage, and processing of hydrocarbons
What is downstream energy?
✔✔ Refining and distribution of oil and gas products
Why are commodity prices important in energy valuation?
✔✔ They directly affect revenue and cash flow
What is a reserve in oil and gas?
1
,✔✔ Estimated recoverable hydrocarbons
What does “proved reserves” mean?
✔✔ Reserves with high certainty of being produced
What is PV-10?
✔✔ Present value of future cash flows discounted at 10%
Why is PV-10 commonly used in energy valuation?
✔✔ It standardizes comparison of oil and gas assets
What is decline rate in oil production?
✔✔ The rate at which well output decreases over time
What is a type curve?
✔✔ An average production profile for similar wells
What is a drilling program?
✔✔ A planned schedule of new wells
Why is capital expenditure important in energy models?
✔✔ It determines production growth and cash requirements
2
, What is lifting cost?
✔✔ Cost to produce one barrel of oil equivalent
What is breakeven oil price?
✔✔ Price at which revenue equals total costs
What is EBITDA used for in energy banking?
✔✔ Measuring operating performance and valuation
Why is debt capacity important for energy companies?
✔✔ Energy projects are capital-intensive
What is reserve life index (RLI)?
✔✔ Years reserves will last at current production
What is commodity hedging?
✔✔ Locking in future prices to reduce risk
Why do energy companies hedge prices?
✔✔ To stabilize cash flows
3
Questions and Answers | Latest
Version | 2025/2026 | Correct & Verified
What does energy investment banking primarily focus on?
✔✔ Advising energy companies on financing, mergers, and asset transactions
What types of companies are covered in energy investment banking?
✔✔ Oil, gas, power, utilities, and renewable energy companies
What is upstream in the energy sector?
✔✔ Exploration and production of oil and gas
What does midstream energy involve?
✔✔ Transportation, storage, and processing of hydrocarbons
What is downstream energy?
✔✔ Refining and distribution of oil and gas products
Why are commodity prices important in energy valuation?
✔✔ They directly affect revenue and cash flow
What is a reserve in oil and gas?
1
,✔✔ Estimated recoverable hydrocarbons
What does “proved reserves” mean?
✔✔ Reserves with high certainty of being produced
What is PV-10?
✔✔ Present value of future cash flows discounted at 10%
Why is PV-10 commonly used in energy valuation?
✔✔ It standardizes comparison of oil and gas assets
What is decline rate in oil production?
✔✔ The rate at which well output decreases over time
What is a type curve?
✔✔ An average production profile for similar wells
What is a drilling program?
✔✔ A planned schedule of new wells
Why is capital expenditure important in energy models?
✔✔ It determines production growth and cash requirements
2
, What is lifting cost?
✔✔ Cost to produce one barrel of oil equivalent
What is breakeven oil price?
✔✔ Price at which revenue equals total costs
What is EBITDA used for in energy banking?
✔✔ Measuring operating performance and valuation
Why is debt capacity important for energy companies?
✔✔ Energy projects are capital-intensive
What is reserve life index (RLI)?
✔✔ Years reserves will last at current production
What is commodity hedging?
✔✔ Locking in future prices to reduce risk
Why do energy companies hedge prices?
✔✔ To stabilize cash flows
3
