Standard Oil Company in 1950

KPMG Case Study Prompt

The year is 1950. You are Standard Oil Company of New Jersey (now known as ExxonMobil), a company that excels in the refining and marketing of petroleum products. The success of your company depends, in part, on your ability to maintain adequate levels of petroleum supply.

Following national energy shortages experienced during WWII, it is clear to your company that securing a source of foreign oil is key to maintaining your supply, and hence your market share. You have been approached, separately, by two other petroleum companies to enter into joint ventures.

One company, Gulf, is interested in establishing drilling rights to a large field located in the small Arabian-peninsula nation of Kuwait. They have offered you a large stake in the venture.

A second oil company, Royal Dutch/Shell, has offered you an equally large stake in a venture to establish drilling rights to a large field located on the border of Iran and Iraq.

You do not have the resources to enter into both ventures. Which one do you choose and why?

Case Study Overview

This KPMG case study involves an oil/gas company in the 1950s. The company has 2 offers on the table to enter into strategic partnerships that will provide access to petroleum, critical for the client’s success. Which partnership should the client pursue, with profitability being the ultimate goal?

Use the Profitability Framework as part of your structure to solve the case. Keep in mind to work outside the basic frameworks to build the structure that will give you the best chance at solving the case problem. Don’t try to force a business situation to fit into a framework!

Preparing for a first round interview? This KPMG case study is a good practice case for a first round at KPMG. The case doesn’t have any math diagrams to solve.

KPMG Interview Tips

What does KPMG look for in its case interview candidates? Quant proficiency and attention to detail.

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