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A dynamic model for valuing flexible mining exploration projects under uncertainty

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  • Miranda, Oscar
  • Brandão, Luiz E.
  • Lazo Lazo, Juan

Abstract

Mining ventures are long term irreversible capital investments that operate in a highly uncertain environment and which typically present significant managerial flexibility. It is a well-known fact that due to their option-like characteristics, the value of these managerial flexibilities is not captured by traditional valuation techniques, such as the discounted cash flow method.

Suggested Citation

  • Miranda, Oscar & Brandão, Luiz E. & Lazo Lazo, Juan, 2017. "A dynamic model for valuing flexible mining exploration projects under uncertainty," Resources Policy, Elsevier, vol. 52(C), pages 393-404.
    • Handle: RePEc:eee:jrpoli:v:52:y:2017:i:c:p:393-404
    DOI: 10.1016/j.resourpol.2017.04.002
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    References listed on IDEAS

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