2007 年 13 巻 p. 109-118
This paper demonstrates the application of option-based analysis in the case of a crude oil exploration project. We show that the traditional Net Present Value (NPV) does not capture all the opportunity values. Despite a negative NPV of forecasted cash flows, the projects inherent flexibility and strategic potential justify its undertaking. The Real Option analysis helps to gain a better understanding of the relative importance to project value of various elements of operating flexibility. This paper presents the possibilities and implications of applying option-based analysis for crude oil exploration in Vietnam. We demonstrate the results of an interview survey with company executives of The Nippon Oil Exploration Limited.