The Model of Upstream Investment Portfolio in the Mature Regions

Liya R. Artemkina, Natalya Y. Sopilko, Olga Y. Myasnikova, Irina U. Eremina, Nataliya V. Bondarchuk and Sergey V. Shamsheev
Additional contact information
Liya R. Artemkina: Gubkin Russian State University of Oil and Gas (National Research University), 65 Leninsky Prospekt, Moscow, Russia,
Natalya Y. Sopilko: Russian State Social University, Vil gelma Picka, 4, Moscow, Russia,
Olga Y. Myasnikova: Peoples Friendship University of Russia, 6 Miklukho-Maklaya, Moscow, Russia,
Irina U. Eremina: Gubkin Russian State University of Oil and Gas (National Research University), 65 Leninsky Prospekt, Moscow, Russia,
Nataliya V. Bondarchuk: Russian Academy of National Economy and Public Administration under the President of the Russian Federation, Vernadsky Prospect, 84, Moscow, Russia.
Sergey V. Shamsheev: Russian State Social University, Vil gelma Picka, 4, Moscow, Russia,

International Journal of Energy Economics and Policy, 2019, vol. 9, issue 4, 173-180

Abstract: Portfolio models can serve as an assessment tool for the optimal assignment of capital between the potential investment projects in the various conditions for upstream companies. This process is crucial for any company if it wants to balance the short-term goals and seeks to maximize long-term value of the company. The paper aims to present a practical model of forming oil upstream company s portfolio. The unique feature of this model is an individual approach to investment plan forming in a context of three types of projects: exploration, oil production and infrastructure projects. This is due to the individual approach which is used for comparison of all projects by using of universal set of indicators. Suggested model uses the multi-criteria selection mechanism by means of aggregating the key estimating indicators into the final project rank score. In that way the task of forming investment project s portfolio of upstream company is a linear programming problem that is solved by simplex method. In the paper the model forms consolidated investment portfolio that takes into account decision makers preferences in setting of limits for resources.

Keywords: Simplex method; optimizing the investment; project s ranking indicator; decision-making mechanism; optimization model; investment portfolio; upstream company (search for similar items in EconPapers)
JEL-codes: L22 O13 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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