Authors

• Ahmad Jafari Samimi ¹
• Toraj Dehghani ²

¹ Professor in Economics,Mazandaran University

² Ph.D. student in Economics

Abstract

In this paper we study one of the most important challenges facing the Iranian Oil authorities: The allocation of natural gas reserves to different uses like exports, petrochemical plants, and injection to oil reserves for enhancing recovery factor. The results show that in the ranking of the project groups on the basis of expected net present value and risk index, the export projects group has a greater value and risk than gas injection projects group and petrochemical group. In choosing the portfolios on the efficient frontier, the amount of gas allocated to export projects should be less if we aim the lower risk than the situation with higher values and risk. However, the amount of gas allocated to injection and petrochemical projects groups will decrease as the risk and value of portfolios increase. Also, the results show that the more risk lover the investor, the higher the amount of gas allocated to gas export projects group.  

Keywords

• Portfolio Management
• expected present value
• efficient frontier
• dynamic programming model
• risk tolerance
• certainty equivalent
• preference analysis