Study On The Economic Evaluation Of Oil-gas Exploration Projects

Oil and Gas are important non-renewable resources. They are important fundamental materials to social progress and development. In recent years, with the rapid development of national economy, the demand of national resources, especially oil and gas is increasing in geometric growth. Meanwhile, the rate of external dependency is increasing day by day. At present, the situation of the oil-gas exploration is becoming more and more serious. Old oil-field has entered three high-stage, including high-moisture high degree of recovery, high rate of oil extraction. New oil field has limited production. And it is more and more difficult to exploration, thus the exploration cost is getting higher and higher. Oil companies pay less emphasis on economic evaluation of exploration projects. They ignore cost savings while they quicken their speed of exploration and exploitation. It conflicts with the idea of the construction of conservation-minded society. Thus, it is necessary to emphasize economic evaluation to gain more benefits at the expense of less cost.Based on the studies of domestic and foreign scholars, this paper first discusses present situation of the study of economic evaluation of oil and gas exploration project, both home and abroad, summed up the characteristics of each study. Then this paper describes some relevant theories of economic evaluation of oil and gas exploration project, concepts and stages of oil and gas exploration; concepts, stage division and characteristics of oil and gas exploration projects; concepts, tasks, target, characteristics and principles of economic evaluation of oil and gas exploration project. Then this paper describes present methods used in economic evaluation, further discusses each method's weaknesses. Based on this, this paper listed real options as one improved methods of net present value methods, giving a detail account of real options theory. Thus, this paper elaborates its evaluation process, integrated methods of exploration and exploitation. Then this paper descriptive the classification of risks existed in the evaluating process. In the following paper, this paper uses real options and risk analysis results to give positive analysis in order to choose one exploration target among different schemes. Finally this paper draws its conclusion and points out further work for future study.