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Empirical analysis of scoring auctions for oil and gas leases

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  • Sant'Anna, Marcelo Castello Branco

Abstract

I study a scoring auctions implemented in Brazil to sell oil exploration rights. Differently from most sales of this kind, bidders had to submit a multi-dimensional bid that included a bonus and an exploratory program. A non-linear scoring rule determined the winner. I propose a method to estimate the underlying primitive distribution of tract values and exploration commitment costs. Estimating the distribution of those primitives allows the evaluation of counterfactual revenues in alternative bidding schemes. I find that a first price auction would imply a 9.7% higher revenue from the sales examined.

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  • Sant'Anna, Marcelo Castello Branco, 2017. "Empirical analysis of scoring auctions for oil and gas leases," FGV EPGE Economics Working Papers (Ensaios Economicos da EPGE) 789, EPGE Brazilian School of Economics and Finance - FGV EPGE (Brazil).
    • Handle: RePEc:fgv:epgewp:789
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    References listed on IDEAS

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