Research On Oil&Gas Assets Valuation During China Company's Overseas M&A Activities

Since more than 20 years for the "go global" strategies implementation,China oil & gas companies have made great progress and improvement in utilizing international capital markets and seeking external economic development.However,with practice in depth on international oil and gas assets M&A activities,traditional investment analysis on behalf of DCF method presents more limitations mainly on its characters of monogamous and inflexibility,which cannot provide quantitative analysis on oil and gas assets valuation and develop measures for mitigating the potential changes occurred during operation of oil and gas assets,especially for conditions when the management facing more possible scenario and decisions should be made under multi-uncertainties exists.Valuation method and its application scope which usually be used for international oil and gas assets M&A has been discussed in this paper and real option method has been introduced into the valuation of potential option value in oil and gas assets,also Monte Carlo simulation methods has been applied for uncertainties quantity evaluation,which provide a positive significant and reference for China oil and gas company taking participate more deeply in international capital market,gearing themselves to the international conventions and transforming the management strategies for adapting to more complex international capital environment and challenges.