Valuation Of Overseas Oil And Gas Companies Based On Discounted Cash Flow Method

As one of the hot areas of overseas mergers and acquisitions for Chinese companies,a reasonable value assessment for overseas companies in the oil and gas industry has become a hot issue for asset assessment and investment experts.In this context,based on the theoretical knowledge and methodological model of enterprise value assessment,this paper improves the traditional company's free cash flow discounted method according to the characteristics of overseas oil and gas companies,aiming to provide reference suggestions for the valuation of overseas oil and gas companies.Firstly,this paper reviews the theories and methods related to enterprise value assessment at home and abroad,and analyzes the applicability and limitations of existing oil and gas company valuation methods—the company's free cash flow discounted method.Then,according to the financial status,asset situation and macro market environment of the three factors affecting the value of overseas oil and gas companies,the improvement scheme of the traditional discounted cash flow method is proposed.The specific improvement is from the two aspects of the forecasting method of operating income and the quantitative introduction of non-financial indicators,to obtain the improved discounted cash flow method.Finally,Seplat Petroleum Development Company,a representative oil and gas exploration and development company in Nigeria,was selected for example application.The valuation results of the discounted cash flow method before and after improvement are compared,the company's market value is also compared with the valuation results,and the valuation result of the discounted cash flow discounted method after improvement is more reasonable.