43 APPENDIX Table 9. Oil and Gas Projects Valuation. Project Name Options Analyzed S (MM$) I (MM$) NPV (MM$) V RO (MM$) ENPV (MM$) Return to Risk 1 ERP Technology Defer 27 12 15 18 33 4.7 2 Solar Energy Panels (Urban) Abandon 150 100 150 7 157 0.1 3 Solar Energy Panels (Rural) Abandon 150 100 150 6 156 0.1 4 Transportation Company Acquisition Expand 400 Not Specified 400 247 645 1.8 5 LNG Asset Contraction Contraction 600 Not Specified 600 155 755 0.5 6 Petrochemical A Expansion, Contraction, Abandon 300 Not Specified 300 76 377 0.9 7 Petrochemical B Expansion, Contraction, Abandon 300 Not Specified 300 80 380 0.9 8 Hydroelectric Plant Continue 650 540 110 18 128 0.5 9 Downstream Project Continue 120 Not Specified 120 5 125 0.2 10 Drilling Asset Contraction Contraction 125 Not Specified 125 38 163 0.7 11 Wind Energy Transmission Continue 435 Not Specified 435 43 478 0.2 12 Outsourcing Oil Logistic Contraction 100 Not Specified 100 3 103 0.1 13 Offshore Oil & Gas Exploration Expand 500 Not Specified 500 51 551 0.3 14 Offshore Oil & Gas Exploration JV Expand 500 Not Specified 500 86 586 0.5 15 Oil Product R&D Growth 50 30 20 27 47 3.0 16 LNG Transportation Expand 750 Not Specified 750 325 1075 1.2 44 17 Oil Waste Water EOR Expansion, Contraction, Abandon 85 Not Specified 85 16 101 0.6 18 Crude Oil Refinery Continue 1230 798 432 18 449 0.1 19 Oil Transportation Abandon 78 56 78 5 83 0.2 20 Diesel Storage Leasing Expand 150 Not Specified 150 7 157 0.1 This Research Offshore Gas Development & Production Expansion, Contraction, Abandon 264 97 167 203 370 2.5 Notes: the portfolio of projects listed in No. 1 – 20 are derived from multiple firms (Hernandez-Perdomo, Mun, and Rocco 2017). 45 Underlying Asset 522 487 455 455 425 425 397 397 397 371 371 371 346 346 346 346 323 323 323 323 302 302 302 302 302 282 282 282 282 282 264 264 264 264 264 264 246 246 246 246 246 230 230 230 230 230 215 215 215 215 201 201 201 201 187 187 187 175 175 175 163 163 153 153 143 133 Figure 13. Underlying Asset Value Calculation - Base Scenario. 46 Development Phase 2 11 12 13 14 15 16 17 18 19 20 828 771 Expand 717 Develop 717 667 Develop 666 Expand 620 Develop 620 Develop 619 576 Develop 576 Develop 575 Expand 535 Develop 535 Develop 534 Develop 534 497 Develop 497 Develop 496 Develop 496 Expand 461 Develop 461 Develop 461 Develop 460 Develop 460 428 Develop 428 Develop 427 Develop 427 Develop 427 Expand 397 Develop 397 Develop 396 Develop 396 Develop 395 Develop 395 368 Develop 367 Develop 367 Develop 366 Develop 366 Expand Develop 340 Develop 340 Develop 339 Develop 339 Develop 339 Develop 315 Develop 314 Develop 314 Develop 313 Expand Develop 291 Develop 290 Develop 290 Develop 289 Develop 268 Develop 268 Develop 267 Expand Develop 247 Develop 247 Develop 246 Develop 228 Develop 227 Expand Develop 209 Develop 209 Develop 192 Expand Develop 176 Expand Figure 14. ENPV in Development Phase 2 - Base Scenario. 47 Development Phase 1 1 2 3 4 5 6 7 8 9 10 800 743 Develop 689 Develop 688 639 Develop 638 Develop 592 Develop 591 Develop 591 548 Develop 548 Develop 547 Develop 508 Develop 507 Develop 506 Develop 506 470 Develop 469 Develop 468 Develop 468 Develop 434 Develop 433 Develop 433 Develop 432 Develop 431 401 Develop 400 Develop 400 Develop 399 Develop 398 Develop 370 Develop 369 Develop 369 Develop 368 Develop 367 Develop 367 340 Develop 340 Develop 339 Develop 338 Develop 338 Develop Develop 313 Develop 312 Develop 311 Develop 311 Develop 310 Develop 287 Develop 286 Develop 286 Develop 285 Develop Develop 263 Develop 262 Develop 262 Develop 261 Develop 240 Develop 240 Develop 239 Develop Develop 219 Develop 219 Develop 218 Develop 199 Develop 199 Develop Develop 181 Develop 180 Develop 164 Develop Develop 148 Develop Figure 15. ENPV in Development Phase 1 - Base Scenario. 48 Underlying Asset 586 551 517 517 485 485 455 455 455 427 427 427 401 401 401 401 377 377 377 377 354 354 354 354 354 332 332 332 332 332 312 312 312 312 312 312 292 292 292 292 292 275 275 275 275 275 258 258 258 258 242 242 242 242 227 227 227 213 213 213 200 200 188 188 176 166 Figure 16. Underlying Asset Value Calculation – Optimized Trajectory Scenario. 49 Development Phase 2 11 12 13 14 15 16 17 18 19 20 785 734 Expand 686 Develop 686 642 Develop 641 Expand 600 Develop 599 Develop 599 560 Develop 560 Develop 559 Expand 523 Develop 523 Develop 522 Develop 522 489 Develop 488 Develop 488 Develop 487 Expand 456 Develop 456 Develop 455 Develop 455 Develop 454 425 Develop 425 Develop 425 Develop 424 Develop 424 Expand 397 Develop 396 Develop 396 Develop 395 Develop 395 Develop 395 369 Develop 369 Develop 369 Develop 368 Develop 368 Expand Develop 344 Develop 343 Develop 343 Develop 342 Develop 342 Develop 320 Develop 319 Develop 319 Develop 318 Expand Develop 297 Develop 297 Develop 296 Develop 296 Develop 276 Develop 275 Develop 275 Expand Develop 256 Develop 255 Develop 255 Develop 237 Develop 237 Expand Develop 219 Develop 219 Develop 203 Expand Develop 187 Expand Figure 17. ENPV in Development Phase 2 - Optimized Trajectory Scenario. 50 Development Phase 1 1 2 3 4 5 6 7 8 9 10 757 706 Develop 658 Develop 658 614 Develop 613 Develop 572 Develop 571 Develop 570 532 Develop 532 Develop 531 Develop 496 Develop 495 Develop 494 Develop 494 461 Develop 460 Develop 460 Develop 459 Develop 429 Develop 428 Develop 427 Develop 427 Develop 426 398 Develop 397 Develop 397 Develop 396 Develop 395 Develop 370 Develop 369 Develop 368 Develop 368 Develop 367 Develop 366 342 Develop 341 Develop 341 Develop 340 Develop 339 Develop Develop 316 Develop 316 Develop 315 Develop 314 Develop 314 Develop 292 Develop 291 Develop 291 Develop 290 Develop Develop 269 Develop 269 Develop 268 Develop 267 Develop 248 Develop 247 Develop 247 Develop Develop 228 Develop 227 Develop 227 Develop 209 Develop 208 Develop Develop 191 Develop 191 Develop 175 Develop Develop 159 Develop Figure 18. ENPV in Development Phase 1 - Optimized Trajectory Scenario. 51 Underlying Asset 511 478 447 447 418 418 390 390 390 365 365 365 341 341 341 341 319 319 319 319 298 298 298 298 298 279 279 279 279 279 261 261 261 261 261 261 244 244 244 244 244 228 228 228 228 228 213 213 213 213 199 199 199 199 186 186 186 174 174 174 163 163 152 152 142 133 Figure 19. Underlying Asset Value Calculation - Extended Reach Trajectory Scenario. 52 Development Phase 2 11 12 13 14 15 16 17 18 19 20 821 765 Expand 712 Develop 711 663 Develop 662 Expand 617 Develop 616 Develop 616 574 Develop 573 Develop 573 Expand 534 Develop 533 Develop 533 Develop 532 496 Develop 496 Develop 495 Develop 495 Expand 461 Develop 461 Develop 460 Develop 460 Develop 459 428 Develop 428 Develop 427 Develop 427 Develop 426 Expand 398 Develop 397 Develop 397 Develop 396 Develop 396 Develop 395 Develop 368 Develop 368 Develop 368 Develop 367 Develop 367 Expand Develop 341 Develop 341 Develop 340 Develop 340 Develop 340 Develop 316 Develop 315 Develop 315 Develop 315 Expand Develop 292 Develop 292 Develop 291 Develop 291 Develop 270 Develop 269 Develop 269 Expand Develop 249 Develop 249 Develop 248 Develop 230 Develop 229 Expand Develop 211 Develop 211 Develop 194 Expand Develop 178 Expand Figure 20. ENPV in Development Phase 2 - Extended Reach Trajectory Scenario. 53 Development Phase 1 1 2 3 4 5 6 7 8 9 10 793 737 Develop 685 Develop 684 636 Develop 635 Develop 590 Develop 589 Develop 588 547 Develop 546 Develop 546 Develop 507 Develop 506 Develop 505 Develop 505 469 Develop 469 Develop 468 Develop 467 Develop 434 Develop 434 Develop 433 Develop 432 Develop 432 402 Develop 401 Develop 400 Develop 400 Develop 399 Develop 371 Develop 371 Develop 370 Develop 369 Develop 369 Develop 368 Develop 342 Develop 341 Develop 341 Develop 340 Develop 339 Develop Develop 315 Develop 314 Develop 313 Develop 313 Develop 312 Develop 289 Develop 289 Develop 288 Develop 287 Develop Develop 265 Develop 265 Develop 264 Develop 263 Develop 243 Develop 242 Develop 242 Develop Develop 222 Develop 221 Develop 221 Develop 202 Develop 202 Develop Develop 184 Develop 183 Develop 167 Develop Develop 151 Develop Figure 21. 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