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The impact of project flexibility on project choice and capital structure
This research highlights the value of Real Options Analysis (ROA) as a process in the evaluation of an oil extraction project in Sub-Saharan Africa. It shows the benefits it can bring to not only the final project evaluation but also to the project design selection process. The research then extends...
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| Other Authors: | |
| Format: | Thesis |
| Language: | English |
| Published: |
Research of GSB
2018
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| _version_ | 1867613252244996097 |
|---|---|
| access_status_str | Open Access |
| author | Forbes, Shaun |
| author2 | Gilbert, Evan |
| author_browse | Forbes, Shaun Gilbert, Evan |
| author_facet | Gilbert, Evan Forbes, Shaun |
| author_sort | Forbes, Shaun |
| collection | Thesis |
| description | This research highlights the value of Real Options Analysis (ROA) as a process in the evaluation of an oil extraction project in Sub-Saharan Africa. It shows the benefits it can bring to not only the final project evaluation but also to the project design selection process. The research then extends the application of ROA by developing and applying a framework which incorporates the fact that project flexibility has a positive impact on the projects value in the face of downside risk. ROA, by virtue of its explicit cash flow volatility modelling provides a framework for a consideration of the optimal level of project debt. In this case it suggests that the project can carry more debt than would have been acceptable if the more traditional NPV method was used in its evaluation. |
| format | Thesis |
| id | oai:open.uct.ac.za:11427/29011 |
| institution | University of Cape Town (South Africa) |
| language | eng |
| last_indexed | 2026-06-10T12:33:10.259Z |
| license_str | Not specified — see source repository |
| provenance_str_mv | Harvested via OAI-PMH from UCTD — University of Cape Town Open Access Repository |
| publishDate | 2018 |
| publishDateRange | 2018 |
| publishDateSort | 2018 |
| publisher | Research of GSB |
| publisherStr | Research of GSB |
| record_format | dspace |
| source_str | UCTD — University of Cape Town Open Access Repository |
| spelling | oai:open.uct.ac.za:11427/29011 The impact of project flexibility on project choice and capital structure Forbes, Shaun Gilbert, Evan Development Finance This research highlights the value of Real Options Analysis (ROA) as a process in the evaluation of an oil extraction project in Sub-Saharan Africa. It shows the benefits it can bring to not only the final project evaluation but also to the project design selection process. The research then extends the application of ROA by developing and applying a framework which incorporates the fact that project flexibility has a positive impact on the projects value in the face of downside risk. ROA, by virtue of its explicit cash flow volatility modelling provides a framework for a consideration of the optimal level of project debt. In this case it suggests that the project can carry more debt than would have been acceptable if the more traditional NPV method was used in its evaluation. 2018-11-06T14:03:38Z 2018-11-06T14:03:38Z 2013 Master Thesis Masters MCom http://hdl.handle.net/11427/29011 eng application/pdf Research of GSB Faculty of Commerce University of Cape Town |
| spellingShingle | Development Finance Forbes, Shaun The impact of project flexibility on project choice and capital structure |
| thesis_degree_str | Master's |
| title | The impact of project flexibility on project choice and capital structure |
| title_full | The impact of project flexibility on project choice and capital structure |
| title_fullStr | The impact of project flexibility on project choice and capital structure |
| title_full_unstemmed | The impact of project flexibility on project choice and capital structure |
| title_short | The impact of project flexibility on project choice and capital structure |
| title_sort | impact of project flexibility on project choice and capital structure |
| topic | Development Finance |
| url | http://hdl.handle.net/11427/29011 |
| work_keys_str_mv | AT forbesshaun theimpactofprojectflexibilityonprojectchoiceandcapitalstructure AT forbesshaun impactofprojectflexibilityonprojectchoiceandcapitalstructure |