Research On Investment Evaluation And Strategy Of Overseas Oil And Gas Assets Based On Quantitative Risk Assessment

The petroleum industry has its own characteristics of "high investment,high yield and high risk".In the current and shortly future,the economic evaluation and risk management of overseas oil and gas exploration and development projects will be asked for higher standards.The reasons are following:the external environment facing by overseas investment is becoming increasingly complex;all kinds of internal and external risks are gradually increasing;in the past two decades,the external dependence of China’s petroleum has increased at a higher rate than expected;domestic oil companies are quickening up the extension of overseas markets;and after years of mining,the difficulties of petroleum exploration and development are growing with each passing day.At present,the economic evaluation method of oil companies,led by the three state-owned oil companies is still the traditional discounted cash flow,while ignoring the high uncertainty characteristics of oil and gas exploration and development projects.In addition,although China’s oil companies have introduced the advanced risk analysis methods conceptually,the standard using rules are still blank.Apparently,all of discussed above illustrates that the methods using by domestic firms are already unable to adapt to the technical supporting for projects’ investment decision-making in the new situation.Based on the research status quo,the research results of this paper are mainly as follows:firstly,this article fully analyzed the necessity and opportunities of Chinese petroleum enterprises’ overseas investments,and the overseas strategic layout of the three major state-owned oil companies.In the background of that,the risk evaluation results form by using expert scoring method of "The Belt and Road" country’s oil and gas cooperation has been made.Secondly,make an actual investment in oil and gas field development project as an example,the @Risk software based on the Monte Carlo principle is used to carry out economic data prediction,economic evaluation analysis,and risk quantification.Furthermore,the probability calculation results covering whole process,and the statistic data graph are also formed.The @Risk software not only keeps the rational part theory of the discounted cash flow method,but also makes up for its shortcomings in the uncertain investment decision-making,enhances the accuracy of the prediction,and realizes multi-factor sensitivity analysis.This method provides theoretical support for the strategic choice of the decision-making,and proves that the Monte Carlo simulation has good applicability for economic evaluation of Chinese Petroleum Companies’ overseas oil and gas exploration and development project.Finally,this paper proposes the reasonable and scientific methods of economic evaluation should be able to make strategic decisions results with the decision makers’risk attitude fully reflected,make the decision makers get a chance to consider the overall interests included related strategic interests of the potential value,and leave space for the realization of "flexible management" in fact.