摘要
Governments in most countries are owners of mineral rights. In order to exploit their natural resources efficiently, states are normally obliged to rely on private mining companies. The government has a challenging task when deciding which exploration opportunities to exercise now through licensing and which blocks to save for future exploration. A large inventory of proven reserves allows scheduling of the production of various deposits more efficiently. But generating proven oil and gas reserves ahead of time entails oil companies and the society incurring extra costs. The value of exploration for petroleum now must be weighted against the value of waiting. This paper uses concepts and methods from option pricing theory to evaluate exploration for deposits of non-renewable resources. Exploration licensing is valued as a compound option, ie as a call option on a call option to develop, with price as the uncertain variable. The Norwegian petroleum licensing framework is used as a background for the specific problem approached, but the problem is familiar to most governments acting as owners of natural resources. Since exploration strategy is the topic of this paper, it is natural to take a look at the many different economic functions exploration serves in order to put the problem in perspective before the model is presented—even though many of the value creating elements are difficult to assess numerically and implement in an economic model.