Research On The Reasonable Sells Of Exploration Rights Prospecting

In the year of 1986, China promulgated the law of "The Mineral Resources Law", and established the mining rights management system. But the exploration right was for free at that time. In resource development, the ownership of government' interests was not be attached importance to. The mineral resources which were explored by the government finally got by some other types of investment subject. This not only caused great loss of state assets, but also encouraged the action of mining waste. State Mineral Resources Regulation 1996 was revised to Transfer the mineral exploration right not for free, whose aim is to consolidate the state ownership and control of mineral resources. Attach such importance to the national construction and reform of prospecting the market only because the right is the logical premise of the exploration of mineral resources and a series of activities relatives. In the process of reform of the primary market to sell the mineral exploration right, the government consults foreign and domestic experience in other industries, so a competitive way to sell the rights has been adopted, but there are many obstacles, specifically manifested until 2007, the auction way to sell the rights share of the total number is still less than 10%.Exploration rights investment has the characteristics of irreversibility and high uncertainty, which created the value of investment opportunities. The traditional method of mining investment decisions taken by a static description of the net cash flow method, which ignores the option value of mining investment, and often underestimate the real value of mining investment projects. sell the rights by the way of auction, failure is inevitable, which is leading to competitive bottlenecks encountered in the work to sell one of the factors.This paper analysis the impact of a variety of market uncertainty based on the auction and option theory, and will be summarize them to two categories:First, the uncertainty caused by the Government basic geological exploration work; second, the uncertainty caused by other factors include market fluctuations, interest rates and so on. The former affected the exploration of whether the potential participants to enter the market, while the latter affected the post-exploration to achieve the prospecting course of business risks and future benefitsThe main work in this paper includes the following aspects:(1) Analysis the role of the mineral exploration right in the national economy status, and generalize the main problems of the development of China's mining industry, illustrates the significance of research and research content.(2) This paper studies the characteristics of the mineral exploration right investment, pointing out that the uncertainties contained in the right, and discussed the shortcomings of traditional methods of the mineral exploration right investment.(3) This paper explores the foundation of the real options theory in the mineral exploration right investment, and Analysis the flexibility of its real options characteristics. At last, this paper presented in the mining investment decision-making in the conditions for the application of real option and should pay attention to problems and to build a real option based on delay in decision-making model.(4) There is a case of research based on the usage of real options theory, whose results shows that the evaluation of real options approach is advanced than the traditional method of mining investment decision-making, and is an ideal way to sell the right combined with the way of auction.