Application and discussion of multi-factor sensitivity analysis in value assessment of areas with low exploration level

With the full implementation of competitive mining rights policies in China, the oil and gas exploration and production market has been fully open, but most of the exploration blocks currently being offered are located in areas with low exploration level. Due to the lack of data and limited understanding in these areas, major oil companies face challenges in evaluating, selecting, and bidding during the process of obtaining mining rights. Against this background, it is particularly crucial for those companies to quickly and effectively assess the value of areas with low exploration level to gain a strategic advantage in block acquisition. This study takes into account the risks in oil and gas exploration, including geological complexity, exploration limitations, development uncertainties, and economic fluctuations. Based on the internationally recognized expected monetary value (EMV) method, the study employed multi-factor sensitivity analysis to identify the key sensitive factors affecting block value assessment. A multiple regression equation was established between the expected revenue per unit of geological resources and the main controlling factors, thereby enabling an effective assessment of the value of areas with low exploration level. The method has been applied to a conventional karstic-fault oil reservoir block in the northern Tarim Basin. This method comprehensively considers geological, exploration, development, and economic risks in oil and gas exploration. Through quantitative multi-factor sensitivity analysis, it determines the key controlling factors and establishes an analogy model. It provides a scientific basis for defining the parameter systems in analogy methods, enabling objective and rapid assessment of expected revenue in areas with low exploration level. It offers strong support for bidding decisions on blocks on offer.