Option value and investment timing: an empirical application to natural gas in Alberta

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dc.contributor.advisorMcKenzie, Kenneth J.
dc.contributor.authorBrown, James R. C.
dc.date.accessioned2005-07-29T22:11:26Z
dc.date.available2005-07-29T22:11:26Z
dc.date.issued1995
dc.descriptionBibliography: p. 48-52.en
dc.description.abstractThis thesis applies a real options approach to the valuation of undeveloped natural gas reserves in Alberta. The real options approach is recommended as an alternative to standard net present value analysis in situations where the investment is irreversible, future cash flows are uncertain, and the firm has operating flexibility to delay investment. Cash flow uncertainty is mcxlelled solely as a function of natural gas price volatility. Standard net present value analysis has several disadvantages in making risky investment decisions. Most prominent is its inability to evaluate the potential benefits from delaying an irreversible investment, thus resulting in non-optimal decision rules. This thesis attempts to econometrically test whether real options theory or discounted cash flow analysis is better able to explain investment behaviour from a statistical point of view.
dc.format.extentx, 91 leaves ; 30 cm.en
dc.identifier.citationBrown, J. R. (1995). Option value and investment timing: an empirical application to natural gas in Alberta (Master's thesis, University of Calgary, Calgary, Canada). Retrieved from https://prism.ucalgary.ca. doi:10.11575/PRISM/12183en_US
dc.identifier.doihttp://dx.doi.org/10.11575/PRISM/12183
dc.identifier.isbn0612042162en
dc.identifier.lccHD 9581 C33 A35 1995en
dc.identifier.urihttp://hdl.handle.net/1880/29825
dc.language.isoeng
dc.publisher.institutionUniversity of Calgaryen
dc.publisher.placeCalgaryen
dc.rightsUniversity of Calgary graduate students retain copyright ownership and moral rights for their thesis. You may use this material in any way that is permitted by the Copyright Act or through licensing that has been assigned to the document. For uses that are not allowable under copyright legislation or licensing, you are required to seek permission.
dc.subject.lccHD 9581 C33 A35 1995en
dc.subject.lcshNatural gas - Alberta
dc.subject.lcshGas industry - Alberta
dc.titleOption value and investment timing: an empirical application to natural gas in Alberta
dc.typemaster thesis
thesis.degree.disciplineEconomics
thesis.degree.grantorUniversity of Calgary
thesis.degree.nameMaster of Arts (MA)
ucalgary.item.requestcopytrue
ucalgary.thesis.accessionTheses Collection 58.002:Box 964 520538274
ucalgary.thesis.notesoffsiteen
ucalgary.thesis.uarcreleaseyen
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