Case Solution

Assumptions taken
300.00 upto 2010

600.00 2011 to 2019
1500.00 2020 to 2044
Oil Price 65.00 per bbl
Operating Expense 7.50% of slaes
Capex (m$) 100 per year from 2008 to2038
Depreciation, Depletion, Amortization 3090.91
Initial Investement (m$) 136000
salvage value (m$) 30000.00
WACC 8.24%
NWC (%of slaes) 10%
Tax 40%
Year 2007 2008 2009
0 1 2
Production (million barrels per day) 0 0.3 0.3
Total Revenue (million $) 0 7020 7020
Operating Expense 0 526.5 526.5
Depreciation, Depletion, Amortization 0 3091 3091
EBIT 0 3403 3403
Capex 0 -100 -100
Depreciation, Depletion, Amortization 0 3,091 3,091
CNWC
Salvage value
Cashflow to Project -136000 6,394 6,394
Project IRR 11.55%
As IRR is 10.33%, IOC will receive 90% of profit oil
Total cost ( overall life ) 209769
Oil cost to IOC 5616 5616
Oil Profit to IOC 1263.6 1263.6
Total Received 6879.6 6879.6
Total Exp 426.5 426.5
Net Receive before tax 6453.1 6453.1
Tax 2581.24 2581.24
Net Received After Tax 3871.86 3871.86
Cumulative net Received after tax 3871.86 7743.72
Cost Ramained Recovered 209769 205897.14 202025.28
Cost Recovered by 2028
After This IOC receive (%of cost oil) 55%
Production (Barrels per day)
Year 2007 2008 2009
Actual total Revenue 6879.6 6879.6
Total Exp 426.5 426.5
Net Income before tax 3,362 3,362
Tax @ 40% 1345 1345
Net income after tax 2,017 2,017
Capex 0 100 100
CNWC 0 0 0
cashflow to IOC -136000 5,208 5,208
Discount Factor 1 0.92 0.85
PV of cashflow -136000 4812 4445
Cumulative Cashflow 0 5,208 10,416
PV of Cashflow 140594
Initial Investment -136000
NPV 4594
real option value 23.07
NPV with real option 4616.72
IRR (Financing rate 9%, Investment rate 8%) 8.47%
MIRR 8.20%
Upto Payback 80% of oil Based on IRR 90%
After payback 55% of oil
2010 2011 2012 2013 2014 2015 2016 2017
3 4 5 6 7 8 9 10
0.3 0.6 0.6 0.6 0.6 0.6 0.6 0.6
7020 14040 14040 14040 14040 14040 14040 14040
526.5 1053 1053 1053 1053 1053 1053 1053
3091 3091 3091 3091 3091 3091 3091 3091
3403 9896 9896 9896 9896 9896 9896 9896
-100 -100 -100 -100 -100 -100 -100 -100
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
-702 0 0 0 0 0 0
6,394 12,185 12,887 12,887 12,887 12,887 12,887 12,887
5616 11232 11232 11232 11232 11232 11232 11232
1263.6 2527.2 2527.2 2527.2 2527.2 2527.2 2527.2 2527.2
6879.6 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2
426.5 1655 953 953 953 953 953 953
6453.1 12104.2 12806.2 12806.2 12806.2 12806.2 12806.2 12806.2
2581.24 4841.68 5122.48 5122.48 5122.48 5122.48 5122.48 5122.48
3871.86 7262.52 7683.72 7683.72 7683.72 7683.72 7683.72 7683.72
11615.58 18878.1 26561.82 34245.54 41929.26 49612.98 57296.7 64980.42
198153.42 190890.9 183207.2 175523.46 167839.7 160156 152472.3 144788.6
IOC's share of cost Oil IOC's share of Profit Oil
2010 2011 2012 2013 2014 2015 2016 2017
6879.6 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2
426.5 1655 953 953 953 953 953 953
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
3,362 9,013 9,715 9,715 9,715 9,715 9,715 9,715
1345 3605 3886 3886 3886 3886 3886 3886
2,017 5,408 5,829 5,829 5,829 5,829 5,829 5,829
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
100 100 100 100 100 100 100 100
0 -702 0 0 0 0 0 0
5,208 7,897 9,020 9,020 9,020 9,020 9,020 9,020
0.79 0.73 0.67 0.62 0.57 0.53 0.49 0.45
4107 5753 6071 5609 5182 4787 4423 4086
15,625 23,522 32,542 41,562 50,582 59,602 68,622 77,642
2018 2019 2020 2021 2022 2023 2024 2025 2026
11 12 13 14 15 16 17 18 19
0.6 0.6 1.5 1.5 1.5 1.5 1.5 1.5 1.5
14040 14040 35100 35100 35100 35100 35100 35100 35100
1053 1053 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3091 3091 3091 3091 3091 3091 3091 3091 3091
9896 9896 29377 29377 29377 29377 29377 29377 29377
-100 -100 -100 -100 -100 -100 -100 -100 -100
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
0 0 -2106 0 0 0 0 0 0
12,887 12,887 30,262 32,368 32,368 32,368 32,368 32,368 32,368
11232 11232 28080 28080 28080 28080 28080 28080 19305
2527.2 2527.2 6318 6318 6318 6318 6318 6318 14215.5
13759.2 13759.2 34398 34398 34398 34398 34398 34398 33520.5
953 953 4638.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5
12806.2 12806.2 29759.5 31865.5 31865.5 31865.5 31865.5 31865.5 30988
5122.48 5122.48 11903.8 12746.2 12746.2 12746.2 12746.2 12746.2 12395.2
7683.72 7683.72 17855.7 19119.3 19119.3 19119.3 19119.3 19119.3 18592.8
72664.14 80347.86 98203.56 117322.86 136442.16 155561.46 174680.76 193800.06 212392.86
137104.9 129421.1 111565.44 92446.14 73326.84 54207.54 35088.24 15968.94
2018 2019 2020 2021 2022 2023 2024 2025 2026
13759.2 13759.2 34398 34398 34398 34398 34398 34398 33520.5
953 953 4638.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
9,715 9,715 26,669 28,775 28,775 28,775 28,775 28,775 27,897
3886 3886 10667 11510 11510 11510 11510 11510 11159
5,829 5,829 16,001 17,265 17,265 17,265 17,265 17,265 16,738
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
100 100 100 100 100 100 100 100 100
0 0 -2106 0 0 0 0 0 0
9,020 9,020 17,086 20,456 20,456 20,456 20,456 20,456 19,929
0.42 0.39 0.36 0.33 0.30 0.28 0.26 0.24 0.22
3775 3488 6104 6751 6237 5762 5324 4919 4427
86,662 95,682 112,768 133,224 153,680 174,135 194,591 215,047 234,976
2027 2028 2029 2030 2031 2032 2033 2034 2035
20 21 22 23 24 25 26 27 28
1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5
35100 35100 35100 35100 35100 35100 35100 35100 35100
2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3091 3091 3091 3091 3091 3091 3091 3091 3091
29377 29377 29377 29377 29377 29377 29377 29377 29377
-100 -100 -100 -100 -100 -100 -100 -100 -100
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
0 0 0 0 0 0 0 0 0
32,368 32,368 32,368 32,368 32,368 32,368 32,368 32,368 32,368
19305 19305 19305 19305 19305 19305 19305 19305 19305
14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5
33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5
2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5
30988 30988 30988 30988 30988 30988 30988 30988 30988
12395.2 12395.2 12395.2 12395.2 12395.2 12395.2 12395.2 12395.2 12395.2
18592.8 18592.8 18592.8 18592.8 18592.8 18592.8 18592.8 18592.8 18592.8
230985.66 249578.46 268171.26 286764.06 305356.86 323949.66 342542.46 361135.26 379728.06
2027 2028 2029 2030 2031 2032 2033 2034 2035
33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5
2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
27,897 27,897 27,897 27,897 27,897 27,897 27,897 27,897 27,897
11159 11159 11159 11159 11159 11159 11159 11159 11159
16,738 16,738 16,738 16,738 16,738 16,738 16,738 16,738 16,738
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
100 100 100 100 100 100 100 100 100
0 0 0 0 0 0 0 0 0
19,929 19,929 19,929 19,929 19,929 19,929 19,929 19,929 19,929
0.21 0.19 0.18 0.16 0.15 0.14 0.13 0.12 0.11
4090 3779 3491 3225 2980 2753 2543 2350 2171
254,905 274,834 294,763 314,692 334,622 354,551 374,480 394,409 414,338
2036 2037 2038 2039 2040 2041 2042 2043 2044
29 30 31 32 33 34 35 36 37
1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5
35100 35100 35100 35100 35100 35100 35100 35100 35100
2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3091 3091 3091 3091 3091 3091 3091 3091 3091
29377 29377 29377 29377 29377 29377 29377 29377 29377
-100 -100 -100 0 0 0 0 0 0
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
0 0 0 0 0 0 0 0 0
30000.00
32,368 32,368 32,368 32,468 32,468 32,468 32,468 32,468 62,468
19305 19305 19305 19305 19305 19305 19305 19305 19305
14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5
33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5
2532.5 2532.5 2532.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
30988 30988 30988 30888 30888 30888 30888 30888 30888
12395.2 12395.2 12395.2 12355.2 12355.2 12355.2 12355.2 12355.2 12355.2
18592.8 18592.8 18592.8 18532.8 18532.8 18532.8 18532.8 18532.8 18532.8
398320.86 416913.66 435506.46 454039.26 472572.06 491104.86 509637.66 528170.46 546703.26
2036 2037 2038 2039 2040 2041 2042 2043 2044
33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5
2532.5 2532.5 2532.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
27,897 27,897 27,897 27,797 27,797 27,797 27,797 27,797 27,797
11159 11159 11159 11119 11119 11119 11119 11119 11119
16,738 16,738 16,738 16,678 16,678 16,678 16,678 16,678 16,678
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
100 100 100 0 0 30000.00 0 0 30000.00
0 0 0 0 0 0 0 0 2808
19,929 19,929 19,929 19,769 19,769 49,769 19,769 19,769 52,577
0.10 0.09 0.09 0.08 0.07 0.07 0.06 0.06 0.05
2006 1853 1712 1569 1449 3371 1237 1143 2808
434,267 454,197
Assumptions taken
300.00 upto 2010
600.00 2011 to 2019
1500.00 2020 to 2044
Oil Price 65.00 per bbl
Operating Expense 0.08 of slaes
Capex (m$) 10000.00% per year from 2008 to2038
Depreciation, Depletion, Amortization 3090.91 on Assets
WACC 8.24%
NWC (%of slaes) 10%
Tax 30%
KazaMunaiGas Share of Profit 16.67%
0 1 2
Year 2007 2008 2009
Production (million barrels per day) 0 0.3 0.3
Total Revenue (million $) 0 7020 7020
Operating Expense 0 526.5 526.5
Depreciation, Depletion, Amortization 0 3091 3091
EBIT 0 3403 3403
Capex 0 -100 -100
CNWC
Salvage value
Cashflow to Project -136000 6,394 6,394
Project IRR 11.54%
Oil cost to IOC 5616 5616
Oil Profit to IOC 1263.6 1263.6
Total Received 6879.6 6879.6
Total Exp 426.5 426.5
Net Receive before tax 6453.1 6453.1
Tax 1935.93 1935.93
Net Received After Tax 4517.17 4517.17
Cumulative net Received after tax 4517.17 9034.34
Cost Ramained Recovered 209769 205251.83 200734.66
After This IOC receive 55% of cost oil
KazmunaiGas get 16.67%
Actual total Revenue 6879.6 6879.6
Total Exp 426.5 426.5
Net Income before tax 3,362 3,362
Tax @ 30% 1009 1009
Net income after tax to IOC 1,961 1,961
Capex 0 100 100
CNWC 0 0 0
cashflow to IOC -136000 5,152 5,152
Discount Factor 1 0.92 0.85
PV of cashflow -136000 4760 4398
Cumulative Cashflow 0 5,152 10,304
NPV 2444
IRR 8.36%
MIRR 8.15%
Upto Payback 80% of oil Based on IRR 90%
After payback 55% of oil
3 4 5 6 7 8 9 10
2010 2011 2012 2013 2014 2015 2016 2017
0.3 0.6 0.6 0.6 0.6 0.6 0.6 0.6
7020 14040 14040 14040 14040 14040 14040 14040
526.5 1053 1053 1053 1053 1053 1053 1053
3091 3091 3091 3091 3091 3091 3091 3091
3403 9896 9896 9896 9896 9896 9896 9896
-100 -100 -100 -100 -100 -100 -100 -100
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
-702 0 0 0 0 0 0
6,394 12,185 12,887 12,887 12,887 12,887 12,887 12,887
5616 11232 11232 11232 11232 11232 11232 11232
1263.6 2527.2 2527.2 2527.2 2527.2 2527.2 2527.2 2527.2
6879.6 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2
426.5 1655 953 953 953 953 953 953
6453.1 12104.2 12806.2 12806.2 12806.2 12806.2 12806.2 12806.2
1935.93 3631.26 3841.86 3841.86 3841.86 3841.86 3841.86 3841.86
4517.17 8472.94 8964.34 8964.34 8964.34 8964.34 8964.34 8964.34
13551.51 22024.45 30988.79 39953.13 48917.47 57881.81 66846.15 75810.49
196217.49 187744.6 178780.2 169815.87 160851.5 151887.2 142922.9 133958.5
KazmunaiGas get 16.67%
6879.6 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2
426.5 1655 953 953 953 953 953 953
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
3,362 9,013 9,715 9,715 9,715 9,715 9,715 9,715
1009 2704 2915 2915 2915 2915 2915 2915
1,961 5,258 5,667 5,667 5,667 5,667 5,667 5,667
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
100 100 100 100 100 100 100 100
0 -702 0 0 0 0 0 0
5,152 7,746 8,858 8,858 8,858 8,858 8,858 8,858
0.79 0.73 0.67 0.62 0.57 0.53 0.49 0.45
4063 5644 5962 5508 5089 4701 4344 4013
15,456 23,203 32,061 40,919 49,777 58,635 67,492 76,350
11 12 13 14 15 16 17 18 19
2018 2019 2020 2021 2022 2023 2024 2025 2026
0.6 0.6 1.5 1.5 1.5 1.5 1.5 1.5 1.5
14040 14040 35100 35100 35100 35100 35100 35100 35100
1053 1053 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3091 3091 3091 3091 3091 3091 3091 3091 3091
9896 9896 29377 29377 29377 29377 29377 29377 29377
-100 -100 -100 -100 -100 -100 -100 -100 -100
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
0 0 -2106 0 0 0 0 0 0
12,887 12,887 30,262 32,368 32,368 32,368 32,368 32,368 32,368
11232 11232 28080 28080 28080 28080 28080 28080 19305
2527.2 2527.2 6318 6318 6318 6318 6318 6318 14215.5
13759.2 13759.2 34398 34398 34398 34398 34398 34398 33520.5
953 953 4638.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5
12806.2 12806.2 29759.5 31865.5 31865.5 31865.5 31865.5 31865.5 30988
3841.86 3841.86 8927.85 9559.65 9559.65 9559.65 9559.65 9559.65 9296.4
8964.34 8964.34 20831.65 22305.85 22305.85 22305.85 22305.85 22305.85 21691.6
84774.83 93739.17 114570.82 136876.67 159182.52 181488.37 203794.22 226100.07 247791.67
124994.2 116029.8 95198.18 72892.33 50586.48 28280.63 5974.78 -16331.07
13759.2 13759.2 34398 34398 34398 34398 34398 34398 33520.5
953 953 4638.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
9,715 9,715 26,669 28,775 28,775 28,775 28,775 28,775 27,897
2915 2915 8001 8632 8632 8632 8632 8632 8369
5,667 5,667 15,556 16,785 16,785 16,785 16,785 16,785 16,273
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
100 100 100 100 100 100 100 100 100
0 0 -2106 0 0 0 0 0 0
8,858 8,858 16,641 19,975 19,975 19,975 19,975 19,975 19,464
0.42 0.39 0.36 0.33 0.30 0.28 0.26 0.24 0.22
3707 3425 5945 6593 6091 5627 5199 4803 4324
85,208 94,066 110,707 130,683 150,658 170,633 190,609 210,584 230,048
20 21 22 23 24 25 26 27 28
2027 2028 2029 2030 2031 2032 2033 2034 2035
1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5
35100 35100 35100 35100 35100 35100 35100 35100 35100
2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3091 3091 3091 3091 3091 3091 3091 3091 3091
29377 29377 29377 29377 29377 29377 29377 29377 29377
-100 -100 -100 -100 -100 -100 -100 -100 -100
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
0 0 0 0 0 0 0 0 0
32,368 32,368 32,368 32,368 32,368 32,368 32,368 32,368 32,368
19305 19305 19305 19305 19305 19305 19305 19305 19305
14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5
33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5
2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5
30988 30988 30988 30988 30988 30988 30988 30988 30988
9296.4 9296.4 9296.4 9296.4 9296.4 9296.4 9296.4 9296.4 9296.4
21691.6 21691.6 21691.6 21691.6 21691.6 21691.6 21691.6 21691.6 21691.6
269483.27 291174.87 312866.47 334558.07 356249.67 377941.27 399632.87 421324.47 443016.07
33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5
2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
27,897 27,897 27,897 27,897 27,897 27,897 27,897 27,897 27,897
8369 8369 8369 8369 8369 8369 8369 8369 8369
16,273 16,273 16,273 16,273 16,273 16,273 16,273 16,273 16,273
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
100 100 100 100 100 100 100 100 100
0 0 0 0 0 0 0 0 0
19,464 19,464 19,464 19,464 19,464 19,464 19,464 19,464 19,464
0.21 0.19 0.18 0.16 0.15 0.14 0.13 0.12 0.11
3995 3690 3410 3150 2910 2689 2484 2295 2120
249,511 268,975 288,439 307,902 327,366 346,829 366,293 385,756 405,220
29 30 31 32 33 34 35 36 37
2036 2037 2038 2039 2040 2041 2042 2043 2044
1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5
35100 35100 35100 35100 35100 35100 35100 35100 35100
2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3091 3091 3091 3091 3091 3091 3091 3091 3091
29377 29377 29377 29377 29377 29377 29377 29377 29377
-100 -100 -100 0 0 0 0 0 0
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
0 0 0 0 0 0 0 0 0
25000.00
32,368 32,368 32,368 32,468 32,468 32,468 32,468 32,468 57,468
19305 19305 19305 19305 19305 19305 19305 19305 19305
14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5
33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5
2532.5 2532.5 2532.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
30988 30988 30988 30888 30888 30888 30888 30888 30888
9296.4 9296.4 9296.4 9266.4 9266.4 9266.4 9266.4 9266.4 9266.4
21691.6 21691.6 21691.6 21621.6 21621.6 21621.6 21621.6 21621.6 21621.6
464707.67 486399.27 508090.87 529712.47 551334.07 572955.67 594577.27 616198.87 637820.47
33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5
2532.5 2532.5 2532.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
27,897 27,897 27,897 27,797 27,797 27,797 27,797 27,797 27,797
8369 8369 8369 8339 8339 8339 8339 8339 8339
16,273 16,273 16,273 19,458 19,458 19,458 19,458 19,458 19,458
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
100 100 100 0 0 25000.00 0 0 25000.00
0 0 0 0 0 0 0 0 2808
19,464 19,464 19,464 22,549 22,549 47,549 22,549 22,549 50,357
0.10 0.09 0.09 0.08 0.07 0.07 0.06 0.06 0.05
1959 1810 1672 1789 1653 3221 1411 1304 2690
424,683 444,147
real option value 0.00 real option value 0.00 real option value 0.00 real option value 0.00
NPV with real option 0.00 NPV with real option 0.00 NPV with real option 0.00 NPV with real option 0.00
real option value 0.00 real option value 0.00 real option value 0.00 real option value 0.00 real option value
NPV with real option 0.00 NPV with real option 0.00 NPV with real option 0.00 NPV with real option 0.00 NPV with real option
0.00 real option value 0.00 real option value 0.00 real option value 0.00 real option value 0.00
0.00 NPV with real option 0.00 NPV with real option 0.00 NPV with real option 0.00 NPV with real option 0.00
real option value #REF! real option value #REF! real option value #REF! real option value #REF! real option value
NPV with real option #REF! NPV with real option #REF! NPV with real option #REF! NPV with real option #REF! NPV with real option
#REF!
#REF!
300.00 upto 2010
600.00 2011 to 2019
1500.00 2020 to 2044
Oil Price 65.00 per bbl Upto Payback
Operating Expense 7.50% of slaes After payback
Depreciation, Depletion, Amortization 3090.91
Initial Investement (m$) 136000.00
salvage value (m$) 25000
WACC 8.24%
NWC (%of slaes) 8.00%
Tax 30%
KazaMunaiGas Share of Profit 8%
Royalty payment to Kazakh 0.15
0 1 2 3
Year 2007 2008 2009 2010
Production (million barrels per day) 0 0.3 0.3 0.3
Total Revenue (million $) 0 7020 7020 7020
Operating Expense 0 526.5 526.5 526.5
Depreciation, Depletion, Amortization 0 3091 3091 3091
EBIT 0 3403 3403 3403
Capex 0 -100 -100 -100
Depreciation, Depletion, Amortization 0 3,091 3,091 3,091
CNWC
Salvage value
Cashflow to Project -136000 6,394 6,394 6,394
Project IRR 11.55%
Total cost ( overall life ) 209769.00
Oil cost to IOC 5616 5616 5616
Oil Profit to IOC -4580.55 -4580.55 -4580.55
Total Received 1035.45 1035.45 1035.45
Total Exp 427 427 427
Net Receive before tax 608.95 608.95 608.95
Tax 182.685 182.685 182.685
Net Received After Tax 426.265 426.265 426.265
Cumulative net Received after tax 426.265 852.53 1278.795
Cost Ramained Recovered 209769.00 209342.74 208916.47 208490.21
IOC's share of cost Oil
Assumptions taken
Actual total Revenue 1035.45 1035.45 1035.45
Total Exp 427 427 427
Operating Expense 0 527 527 527
Net Income before tax 82 82 82
Tax @ 30% 25 25 25
Net income after tax to IOC 53 53 53
Operating Expense 0 527 527 527
Capex 0 -100 -100 -100
CNWC 0 0 0 0
cashflow to IOC -136000.00 479 479 479
Discount Factor 0.988193135 1.00 1.00 1.00
PV of cashflow -134394 479 479 479
Cumulative Cashflow 0 479 959 1,438
NPV -63999
NPV with real option -63975.75
IRR 1.78%
MIRR 1.81%
80% of oil Based on IRR 90%
55% of oil
4 5 6 7 8 9 10
2011 2012 2013 2014 2015 2016 2017
0.6 0.6 0.6 0.6 0.6 0.6 0.6
14040 14040 14040 14040 14040 14040 14040
1053 1053 1053 1053 1053 1053 1053
3091 3091 3091 3091 3091 3091 3091
9896 9896 9896 9896 9896 9896 9896
-100 -100 -100 -100 -100 -100 -100
3,091 3,091 3,091 3,091 3,091 3,091 3,091
-561.6 0 0 0 0 0 0
12,325 12,887 12,887 12,887 12,887 12,887 12,887
11232 11232 11232 11232 11232 11232 11232
-9161.1 -9161.1 -9161.1 -9161.1 -9161.1 -9161.1 -9161.1
2070.9 2070.9 2070.9 2070.9 2070.9 2070.9 2070.9
1515 953 953 953 953 953 953
556.3 1117.9 1117.9 1117.9 1117.9 1117.9 1117.9
166.89 335.37 335.37 335.37 335.37 335.37 335.37
389.41 782.53 782.53 782.53 782.53 782.53 782.53
1668.205 2450.735 3233.265 4015.795 4798.325 5580.855 6363.385
208100.80 207318.27 206535.74 205753.21 204970.68 204188.15 203405.62
KazmunaiGas get 50%
2070.9 2070.9 2070.9 2070.9 2070.9 2070.9 2070.9
1515 953 953 953 953 953 953
1,053 1,053 1,053 1,053 1,053 1,053 1,053
-497 65 65 65 65 65 65
-149 19 19 19 19 19 19
-319 42 42 42 42 42 42
1,053 1,053 1,053 1,053 1,053 1,053 1,053
-100 -100 -100 -100 -100 -100 -100
-562 0 0 0 0 0 0
73 995 995 995 995 995 995
1.00 1.00 1.00 1.00 1.00 1.00 1.00
73 995 995 995 995 995 995
1,511 2,506 3,500 4,495 5,489 6,484 7,479
11 12 13 14 15 16 17
2018 2019 2020 2021 2022 2023 2024
0.6 0.6 1.5 1.5 1.5 1.5 1.5
14040 14040 35100 35100 35100 35100 35100
1053 1053 2632.5 2632.5 2632.5 2632.5 2632.5
3091 3091 3091 3091 3091 3091 3091
9896 9896 29377 29377 29377 29377 29377
-100 -100 -100 -100 -100 -100 -100
3,091 3,091 3,091 3,091 3,091 3,091 3,091
0 0 -1684.8 0 0 0 0
12,887 12,887 30,683 32,368 32,368 32,368 32,368
11232 11232 28080 28080 28080 28080 28080
-9161.1 -9161.1 -22902.75 -22902.75 -22902.75 -22902.75 -22902.8
2070.9 2070.9 5177.25 5177.25 5177.25 5177.25 5177.25
953 953 4217 2533 2533 2533 2533
1117.9 1117.9 959.95 2644.75 2644.75 2644.75 2644.75
335.37 335.37 287.985 793.425 793.425 793.425 793.425
782.53 782.53 671.965 1851.325 1851.325 1851.325 1851.325
7145.915 7928.445 8600.41 10451.735 12303.06 14154.385 16005.71
202623.09 201840.56 201168.59 199317.27 197465.94 195614.62 193763
2070.9 2070.9 5177.25 5177.25 5177.25 5177.25 5177.25
953 953 4217 2533 2533 2533 2533
1,053 1,053 2,633 2,633 2,633 2,633 2,633
65 65 -1,673 12 12 12 12
19 19 -502 4 4 4 4
42 42 -1,073 8 8 8 8
1,053 1,053 2,633 2,633 2,633 2,633 2,633
-100 -100 -100 -100 -100 -100 -100
0 0 -1,685 0 0 0 0
995 995 -226 2,540 2,540 2,540 2,540
1.00 1.00 1.00 1.00 1.00 1.00 1.00
995 995 -226 2540 2540 2540 2540
8,473 9,468 9,243 11,783 14,323 16,864 19,404
18 19 20 21 22 23 24 25 26
2025 2026 2027 2028 2029 2030 2031 2032 2033
1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5
35100 35100 35100 35100 35100 35100 35100 35100 35100
2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3091 3091 3091 3091 3091 3091 3091 3091 3091
29377 29377 29377 29377 29377 29377 29377 29377 29377
-100 -100 -100 -100 -100 -100 -100 -100 -100
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
0 0 0 0 0 0 0 0 0
32,368 32,368 32,368 32,368 32,368 32,368 32,368 32,368 32,368
28080 28080 28080 28080 28080 28080 28080 28080 28080
-22902.8 -22902.8 -22902.8 -22902.8 -22902.8 -22902.8 -22902.8 -22902.8 -22902.8
5177.25 5177.25 5177.25 5177.25 5177.25 5177.25 5177.25 5177.25 5177.25
2533 2533 2533 2533 2533 2533 2533 2533 2533
2644.75 2644.75 2644.75 2644.75 2644.75 2644.75 2644.75 2644.75 2644.75
793.425 793.425 793.425 793.425 793.425 793.425 793.425 793.425 793.425
1851.325 1851.325 1851.325 1851.325 1851.325 1851.325 1851.325 1851.325 1851.325
17857.04 19708.36 21559.69 23411.01 25262.34 27113.66 28964.99 30816.31 32667.64
191912 190061 188209 186358 184507 182655 180804 178953 177101
5177.25 5177.25 5177.25 5177.25 5177.25 5177.25 5177.25 5177.25 5177.25
2533 2533 2533 2533 2533 2533 2533 2533 2533
2,633 2,633 2,633 2,633 2,633 2,633 2,633 2,633 2,633
12 12 12 12 12 12 12 12 12
4 4 4 4 4 4 4 4 4
8 8 8 8 8 8 8 8 8
2,633 2,633 2,633 2,633 2,633 2,633 2,633 2,633 2,633
-100 -100 -100 -100 -100 -100 -100 -100 -100
0 0 0 0 0 0 0 0 0
2,540 2,540 2,540 2,540 2,540 2,540 2,540 2,540 2,540
1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00
2540 2540 2540 2540 2540 2540 2540 2540 2540
21,944 24,485 27,025 29,565 32,106 34,646 37,186 39,727 42,267
27 28 29 30 31 32 33 34 35
2034 2035 2036 2037 2038 2039 2040 2041 2042
1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5
35100 35100 35100 35100 35100 35100 35100 35100 35100
2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3091 3091 3091 3091 3091 3091 3091 3091 3091
29377 29377 29377 29377 29377 29377 29377 29377 29377
-100 -100 -100 -100 -100 0 0 0 0
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
0 0 0 0 0 0 0 0 0
32,368 32,368 32,368 32,368 32,368 32,468 32,468 32,468 32,468
28080 28080 28080 28080 28080 28080 28080 28080 28080
-22902.8 -22902.8 -22902.8 -22902.8 -22902.8 -22902.8 -22902.8 -22902.8 -22902.8
5177.25 5177.25 5177.25 5177.25 5177.25 5177.25 5177.25 5177.25 5177.25
2533 2533 2533 2533 2533 2633 2633 2633 2633
2644.75 2644.75 2644.75 2644.75 2644.75 2544.75 2544.75 2544.75 2544.75
793.425 793.425 793.425 793.425 793.425 763.425 763.425 763.425 763.425
1851.325 1851.325 1851.325 1851.325 1851.325 1781.325 1781.325 1781.325 1781.325
34518.96 36370.29 38221.61 40072.94 41924.26 43705.59 45486.91 47268.24 49049.56
175250 173399 171547 169696 167845 166063 164282 162501 160719
5177.25 5177.25 5177.25 5177.25 5177.25 5177.25 5177.25 5177.25 5177.25
2533 2533 2533 2533 2533 2633 2633 2633 2633
2,633 2,633 2,633 2,633 2,633 2,633 2,633 2,633 2,633
12 12 12 12 12 -88 -88 -88 -88
4 4 4 4 4 -26 -26 -26 -26
8 8 8 8 8 -61 -61 -61 -61
2,633 2,633 2,633 2,633 2,633 2,633 2,633 2,633 2,633
-100 -100 -100 -100 -100 0 0 0 0
0 0 0 0 0 0 0 0 0
2,540 2,540 2,540 2,540 2,540 2,571 2,571 2,571 2,571
1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00
2540 2540 2540 2540 2540 2571 2571 2571 2571
44,808 47,348 49,888 52,429
36 37
2043 2044
1.5 1.5
35100 35100
2632.5 2632.5
3091 3091
29377 29377
0 0
3,091 3,091
0 0
25000.00
32,468 57,468
28080 28080
-22902.8 -22902.8
5177.25 5177.25
2633 2633
2544.75 2544.75
763.425 763.425
1781.325 1781.325
50830.89 52612.21
158938 157157
5177.25 5177.25
2633 2633
2,633 2,633
-88 -88
-26 -26
-61 -61
2,633 2,633
0 0
0 0
2,571 2,571
1.00 1.00
2571 2571
real option value 0.00 real option value 0.00 real option value 0.00
NPV with real option 0.00 NPV with real option 0.00 NPV with real option 0.00
real option value 0.00 real option value #REF! real option value #REF! real option value #REF! real option value
NPV with real option 0.00 NPV with real option #REF! NPV with real option #REF! NPV with real option #REF! NPV with real option
#REF! real option value #REF!
#REF! NPV with real option #REF!
Assumptions taken
Production (Barrels per day) 300.00 upto 2010
600.00 2011 to 2019
1500.00 2020 to 2044
Oil Price 65.00 per bbl Upto Payback
Operating Expense 7.50% of slaes After payback
Depreciation, Depletion, Amortization 3090.91 on Assets
WACC 8.24%
NWC (%of slaes) 8%
Tax 30%
KazaMunaiGas Share of Profit 8.33%
Payment to Kazakh Government (m$) 7000.00
0 1 2 3
Year 2007 2008 2009 2010
Production (million barrels per day) 0 0.3 0.3 0.3
Total Revenue (million $) 0 7020 7020 7020
Operating Expense 0 526.5 526.5 526.5
Depreciation, Depletion, Amortization 0 3091 3091 3091
EBIT 0 3403 3403 3403
Capex 0 -100 -100 -100
CNWC
Salvage value
Cashflow to Project -136000 6,394 6,394 6,394
Project IRR 11.55%
Oil cost to IOC 5616 5616 5616
Oil Profit to IOC 1263.6 1263.6 1263.6
Total Received 6879.6 6879.6 6879.6
Total Exp 426.5 426.5 426.5
Net Receive before tax 6453.1 6453.1 6453.1
Tax 1935.93 1935.93 1935.93
Net Received After Tax 4517.17 4517.17 4517.17
Cumulative net Received after tax 4517.17 9034.34 13551.51
Cost Ramained Recovered 209769 205251.83 200734.7 196217.49
IOC's share of cost Oil
Compensation to govt
Actual total Revenue 6879.6 6879.6 6879.6
Total Exp 426.5 426.5 426.5
Net Income before tax 3,362 3,362 3,362
Tax @ 30% 1009 1009 1009
Net income after tax to IOC 2,157 2,157 2,157
Capex 0 100 100 100
CNWC 0 0 0 0
cashflow to IOC -143000 5,348 5,348 5,348
Discount Factor 1 0.92 0.85 0.79
PV of cashflow -143000 4941 4565 4218
Cumulative Cashflow 0 5,348 10,697 16,045
NPV 5061
IRR 8.48%
MIRR 8.20%
80% of oil Based on IRR 90%
55% of oil
4 5 6 7 8 9 10 11 12
2011 2012 2013 2014 2015 2016 2017 2018 2019
0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6
14040 14040 14040 14040 14040 14040 14040 14040 14040
1053 1053 1053 1053 1053 1053 1053 1053 1053
3091 3091 3091 3091 3091 3091 3091 3091 3091
9896 9896 9896 9896 9896 9896 9896 9896 9896
-100 -100 -100 -100 -100 -100 -100 -100 -100
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
-561.6 0 0 0 0 0 0 0 0
12,325 12,887 12,887 12,887 12,887 12,887 12,887 12,887 12,887
11232 11232 11232 11232 11232 11232 11232 11232 11232
2527.2 2527.2 2527.2 2527.2 2527.2 2527.2 2527.2 2527.2 2527.2
13759.2 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2
1514.6 953 953 953 953 953 953 953 953
12244.6 12806.2 12806.2 12806.2 12806.2 12806.2 12806.2 12806.2 12806.2
3673.38 3841.86 3841.86 3841.86 3841.86 3841.86 3841.86 3841.86 3841.86
8571.22 8964.34 8964.34 8964.34 8964.34 8964.34 8964.34 8964.34 8964.34
22122.73 31087.07 40051.41 49015.75 57980.09 66944.43 75908.77 84873.11 93837.45
187646.3 178681.9 169717.59 160753.3 151788.9 142824.6 133860.2 124895.9 115931.6
Compensation to govt
13759.2 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2 13759.2
1514.6 953 953 953 953 953 953 953 953
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
9,154 9,715 9,715 9,715 9,715 9,715 9,715 9,715 9,715
2746 2915 2915 2915 2915 2915 2915 2915 2915
5,874 6,234 6,234 6,234 6,234 6,234 6,234 6,234 6,234
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
100 100 100 100 100 100 100 100 100
-561.6 0 0 0 0 0 0 0 0
8,503 9,425 9,425 9,425 9,425 9,425 9,425 9,425 9,425
0.73 0.67 0.62 0.57 0.53 0.49 0.45 0.42 0.39
6195 6344 5861 5415 5002 4622 4270 3945 3644
24,548 33,973 43,399 52,824 62,249 71,674 81,099 90,524 99,949
13 14 15 16 17 18 19 20 21
2020 2021 2022 2023 2024 2025 2026 2027 2028
1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5
35100 35100 35100 35100 35100 35100 35100 35100 35100
2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3091 3091 3091 3091 3091 3091 3091 3091 3091
29377 29377 29377 29377 29377 29377 29377 29377 29377
-100 -100 -100 -100 -100 -100 -100 -100 -100
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
-1684.8 0 0 0 0 0 0 0 0
30,683 32,368 32,368 32,368 32,368 32,368 32,368 32,368 32,368
28080 28080 28080 28080 28080 28080 19305 19305 19305
6318 6318 6318 6318 6318 6318 14215.5 14215.5 14215.5
34398 34398 34398 34398 34398 34398 33520.5 33520.5 33520.5
4217.3 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5
30180.7 31865.5 31865.5 31865.5 31865.5 31865.5 30988 30988 30988
9054.21 9559.65 9559.65 9559.65 9559.65 9559.65 9296.4 9296.4 9296.4
21126.49 22305.85 22305.85 22305.85 22305.85 22305.85 21691.6 21691.6 21691.6
114963.94 137269.79 159575.64 181881.49 204187.34 226493.19 248184.79 269876.39 291567.99
94805.06 72499.21 50193.36 27887.51 5581.66 -16724.19
34398 34398 34398 34398 34398 34398 33520.5 33520.5 33520.5
4217.3 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
27,090 28,775 28,775 28,775 28,775 28,775 27,897 27,897 27,897
8127 8632 8632 8632 8632 8632 8369 8369 8369
17,383 18,464 18,464 18,464 18,464 18,464 17,901 17,901 17,901
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
100 100 100 100 100 100 100 100 100
-1684.8 0 0 0 0 0 0 0 0
18,889 21,655 21,655 21,655 21,655 21,655 21,092 21,092 21,092
0.36 0.33 0.30 0.28 0.26 0.24 0.22 0.21 0.19
6748 7147 6603 6100 5636 5207 4685 4329 3999
118,839 140,494 162,149 183,804 205,460 227,115 248,207 269,299 290,392
22 23 24 25 26 27 28 29 30
2029 2030 2031 2032 2033 2034 2035 2036 2037
1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5
35100 35100 35100 35100 35100 35100 35100 35100 35100
2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3091 3091 3091 3091 3091 3091 3091 3091 3091
29377 29377 29377 29377 29377 29377 29377 29377 29377
-100 -100 -100 -100 -100 -100 -100 -100 -100
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
0 0 0 0 0 0 0 0 0
32,368 32,368 32,368 32,368 32,368 32,368 32,368 32,368 32,368
19305 19305 19305 19305 19305 19305 19305 19305 19305
14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5
33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5
2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5
30988 30988 30988 30988 30988 30988 30988 30988 30988
9296.4 9296.4 9296.4 9296.4 9296.4 9296.4 9296.4 9296.4 9296.4
21691.6 21691.6 21691.6 21691.6 21691.6 21691.6 21691.6 21691.6 21691.6
313259.59 334951.19 356642.79 378334.39 400025.99 421717.59 443409.19 465100.79 486792.39
33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5
2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5 2532.5
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
27,897 27,897 27,897 27,897 27,897 27,897 27,897 27,897 27,897
8369 8369 8369 8369 8369 8369 8369 8369 8369
17,901 17,901 17,901 17,901 17,901 17,901 17,901 17,901 17,901
3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091 3,091
100 100 100 100 100 100 100 100 100
0 0 0 0 0 0 0 0 0
21,092 21,092 21,092 21,092 21,092 21,092 21,092 21,092 21,092
0.18 0.16 0.15 0.14 0.13 0.12 0.11 0.10 0.09
3695 3414 3154 2914 2692 2487 2298 2123 1961
311,484 332,576 353,668 374,760 395,853 416,945 438,037 459,129 480,221
31 32 33 34 35 36 37
2038 2039 2040 2041 2042 2043 2044
1.5 1.5 1.5 1.5 1.5 1.5 1.5
35100 35100 35100 35100 35100 35100 35100
2632.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3091 3091 3091 3091 3091 3091 3091
29377 29377 29377 29377 29377 29377 29377
-100 0 0 0 0 0 0
3,091 3,091 3,091 3,091 3,091 3,091 3,091
0 0 0 0 0 0 0
25000.00
32,368 32,468 32,468 32,468 32,468 32,468 57,468
19305 19305 19305 19305 19305 19305 19305
14215.5 14215.5 14215.5 14215.5 14215.5 14215.5 14215.5
33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5
2532.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
30988 30888 30888 30888 30888 30888 30888
9296.4 9266.4 9266.4 9266.4 9266.4 9266.4 9266.4
21691.6 21621.6 21621.6 21621.6 21621.6 21621.6 21621.6
508483.99 530105.59 551727.19 573348.79 594970.39 616591.99 638213.59
33520.5 33520.5 33520.5 33520.5 33520.5 33520.5 33520.5
2532.5 2632.5 2632.5 2632.5 2632.5 2632.5 2632.5
3,091 3,091 3,091 3,091 3,091 3,091 3,091
27,897 27,797 27,797 27,797 27,797 27,797 27,797
8369 8339 8339 8339 8339 8339 8339
17,901 19,458 19,458 19,458 19,458 19,458 19,458
3,091 3,091 3,091 3,091 3,091 3,091 3,091
100 0 0 25000.00 0 0 25000.00
0 0 0 0 0 0 2246.4
21,092 22,549 22,549 47,549 22,549 22,549 49,795
0.09 0.08 0.07 0.07 0.06 0.06 0.05
1812 1789 1653 3221 1411 1304 2660
Assumptions taken
Initial Investment to Expand 2500
Expand started by 2025 to 2044
Price per bbl 60
WACC 8.47%
Time until the option expires (t) 19
18 19 20
2025 2026 2027
Cashflow (m$) Best -2500 600 600
Base -2500 350 350
Worst -2500 200 200
at 2025 at 2008 Probability
PV of cashflow Best $3,093.93 716.63 30%
Base $1,511.58 350.12 50%
Worst ($144.06) -33.37 20%
Expected NPV
Year
Probability
Best 30%
Base 50%
Worst 20%
21 22 23 24 25 26 27 28
2028 2029 2030 2031 2032 2033 2034 2035
600 600 600 600 600 600 600 700
450 450 450 450 450 450 450 450
250 250 250 250 250 250 250 300
Probability Adjusted NPV Probability Return Rf 5.00%
214.99 30% 28.67% t 19
175.06 50% 14.00% X/K 2500
-6.67 20% -1.33% 0.173
383.38 15.335% Var 0.030
S 383.38
d1 -0.852923
Standrad Deviation 0.173 d2 -1.605470
Variance 0.030 0.386741
N(d1) 0.20
N(d2) 0.054
V 23.07
^(
29 30 31 32 33 34 35 36 37
2036 2037 2038 2039 2040 2041 2042 2043 2044
700 700 700 700 700 700 650 650 650
500 500 500 500 500 500 500 500 500
300 300 300 300 300 250 250 250 250
12250
8800
4950
Capital Structure
Rf 5.00%
Beta 1.10
Rm 9.50% Sources Amount (m $) Weight
Ke 9.95% Equity 40800 30%
Add: Risk Premium 2.00% Debt 95200 70%
Adjusted Ke 11.95% Total 136000 100%
Cost of Debt 6.65%
base
Cost Weighted cost
11.95% 3.59%
6.65% 4.66%
0.00% 8.24%
base

Case Solution

Transféré par

Informations du document

Titre original

Copyright

Formats disponibles

Partager ce document

Partager ou intégrer le document

Options de partage

Avez-vous trouvé ce document utile ?

Ce contenu est-il inapproprié ?

Droits d'auteur :

Formats disponibles

Case Solution

Transféré par

Droits d'auteur :

Formats disponibles

Assumptions taken

300.00 upto 2010

Vous aimerez peut-être aussi