Project Ranking in Petroleum Exploration

Abstract

Project ranking based on project value is an essential management task for organizations that face resource bottlenecks. Project value focuses on the hard elements of projects that can be expressed in monetary terms. In the petroleum exploration business, however, there is also soft information, like effects on corporate liquidity, advantages of compliance with the strategic goals, or learning potential and organizational development, which may change the ranking hierarchy. The aim of this research is to provide a solution for incorporating industry-based selected soft data in the project ranking process. The process is illustrated with a case study. We took the structured system of criteria identified from the petroleum industry.

KEYWORDS:

• project portfolio selection
• project ranking
• industry specific criteria
• project management
• Analytic Hierarchy Process
• petroleum exploration

Author contributions

TamÁs Tóth, Ph.D., works for the Department of Finance at the Eötvös Loránd University. His fields of research are corporate finance, taxation, risk management, project portfolio optimization, and advanced financial modeling. He gives lectures at intermediate and advanced levels for both entrants and adult practitioners. In addition to his academic duties, he is the senior financial advisor of many industrial research projects.

ZoltÁn SebestyÉn, Ph.D., is an associate professor of Production and Operations Management and Project Management in the Department of Management and Corporate Economics at Budapest University of Technology and Economics. His research fields are focused mainly on interdisciplinary aspects of project management (change management, finance, quality). He was a co-editor of the local edition of the Harvard Business Review.

Imre SzilÁgyi is an exploration geologist and petroleum economist with 20 years of oil business management experience. He holds an M.Sc. in geology from Eötvös Loránd University and an MBA (finance) from the Budapest University of Technology and Economics. He has filled various senior management and advisory positions with the E&P Division of MOL Hungarian Oil and Gas Plc. His key positions included MOL’s exploration director, managing director of MOL Oman, and chief geoscientist. He currently works as master instructor of petroleum geosciences and exploration at Eötvös Loránd University. He is Honorary Associate Professor in the Faculty of Earth Science and Engineering, Miskolc University.