Abstract:

In recent years, the method of static break even point has widely been applied to investment decision to oil and gas exploitation. On basis of the summarizing research result both home and abroad, the method of break even point extending from static state to dynamic state is explored, and the calculation method of dynamic break even point is achieved. Because break even point is various on different interest rate levels, the method of static break even point can more efficiently analyze investment decision to oil and gas exploitation than static break even point. Finally, then method is applied to economic analysis of oil and gas exploitation investment in a certain oil field in Northwestern China .

Key words: dynamic break even point, oil and gas exploitation, investment decision, economic evaluation