The Application Of Real Option Method In Mining Rights Evaluation

Mineral resources are a valuable commodity, human labor and nature of the Creator to create a common product. Mineral resources are of great value, its complexity and diversity as well as a variety of factors to assess the value of mining rights have a broad impact on the mining rights market, so that mining rights valuation has become a very subjective assessment, and to assess staff brought the workload is very challenging. Assessment of mining rights, mining rights are based on people’s perception of value, the economy, geology, mathematics and other scientific techniques integrated use of the mathematical parameters, geological information, and other data to quantify the economic principles, the value of mineral resources were evaluated estimated methodological approach. And according to a variety of factors to assess the object and purpose of the evaluation, such as the degree of influence of geological prospecting, mining rights to use different valuation methods, but also have a significant impact on its results of the assessment. However, mining rights assessment methods include the income approach, market approach and cost approach to assess three kinds of ways, including the discounted cash flow method, the income method, geological factor assessment order method, replacement cost method, a rough estimate methods. Theoretical research and evaluation practice shows that the traditional DCF valuation method for mining rights has some drawbacks, which did not fully reflect the uncertainty in the value of mining rights and the elasticity of demand, it is difficult to ensure that scientific and accurate assessment of mining rights. At the same time, the assessment of the various evaluation parameters to define itself, accurate understanding and control, will affect the results of the assessment of credibility.Based on the above reasons, the issue of mining rights assessment methods chosen worth exploring and attention, this article by referring to historical documents, collect information to assess domestic and foreign mining rights, mining rights assessment analysis of the status quo at home and abroad. Mining rights on the basis of valuation theory, the value of the type of mining rights, mining rights to explore factors that affect valuation. On this basis, further study of the basic methods of mining rights assessment, compare their characteristics and scope of application. These two kinds of evaluation methods of mining rights through discounted cash flow method (DCF) and real options approach (ROA) compared to the limitations of traditional DCF valuation method of mining rights to conduct a detailed analysis, and discusses the real options approach (ROA) used in the mining rights assessment; Finally, the value of L coal mining rights assessment as an example, the establishment of appropriate models, computational analysis to assess the value of L coal mining rights in2014related to economic data, comparative analysis of DCF and real options model results corresponding conclusions, and our assessment of mining rights to select forward reasonable proposals. Conclusions show that the introduction of the mining rights valuation in real option pricing model, more flexible and scientific, can effectively avoid the mining rights valuation risk; DCF method and the mutual use of ROA law that allows mining rights valuation results more reasonable and effective investment projects to improve the accuracy of mining rights, benefits for investors.