Fast-Mover Advantages: Speed Capabilities and Entry into the Emerging Submarket of Atlantic Basin LNG

Hawk, Ashton; Pacheco‐de‐Almeida, Gonçalo; Yeung, Bernard

doi:10.2139/ssrn.1988143

Cited by 15 publications

(33 citation statements)

References 52 publications

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“…Studies on option timing focus on a variety of contexts, including technology or R&D investments (e.g., McGrath and Nerkar, 2004;Cuervo-Cazurra and Un, 2010) as well as timing of investments in new markets and new products (e.g., Folta and O'Brien, 2004;Hawk et al, 2013) and highlight factors that prompt (e.g., technical experience, existence of numerous competitors) or deter investments (e.g., market uncertainty).…”

Section: Timing and Optionsmentioning

confidence: 99%

“…These studies suggest that possessing a portfolio of real options or making real option investment decisions improves overall firm value (e.g., Makhija, 2009a, 2009b;Yang et al, 2014). The second perspective focuses on the financial consequences (firm performance) of making a real option decision (e.g., Kumar, 2005;Hawk et al, 2013;Klingebiel and Adner, 2015), while the third part discusses individual performance (Raffiee and Feng, 2014).…”

Section: Real Option Value/performancementioning

confidence: 99%

“…Those real option papers looking at operation management issues include studies investigating the expansion/divestment of existing operations (e.g., Kogut, 1991;Folta and Miller, 2002;Xu et al, 2010), as well as the entry into new industries (Campa, 1994;Folta and O'Brien, 2004;Hawk et al, 2013). Future research might employ real option logic to look at other operation decisions such as those involving product diversity.…”

Section: Individual Performancementioning

confidence: 99%

See 2 more Smart Citations

25 Years of Real Option Empirical Research in Management

Ipsmiller

Brouthers

Dikova

2018

European Management Review

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For several decades, management scholars have extolled the virtues of using real option logic when making decisions under uncertainty. Real option logic suggests that in such situations, firms might be better off deferring or staging investments, reducing potential financial losses, while at the same time securing an option to grow (or abandon) the investment when uncertainty abates. Our analysis of the empirical research published in leading management journals over the past 25 years suggests that while some progress has been made, much more work needs to be done. We still do not have the answers to critical questions such as: Which entrepreneurial/managerial traits impact the identification or exploitation of real options? Do multiple types of uncertainties interact with each other and influence real option decisions? Addressing these and other issues identified in our study can help improve our understanding of the usefulness of real option logic in management.

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Section: Timing and Optionsmentioning

confidence: 99%

Section: Real Option Value/performancementioning

confidence: 99%

Section: Individual Performancementioning

confidence: 99%

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25 Years of Real Option Empirical Research in Management

Ipsmiller

Brouthers

Dikova

2018

European Management Review

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“…The comparable distance for on-shore pipelines is around 2,200 land miles/3,500 km ( Figure 1). LNG supplied about 10% of world gas demand in 2010 and its relative importance is increasing as internationally demand for it grows faster than demand for pipeline gas (Hawk et al, 2013;Kumar et al, 2011). It is possible that due to the maturity of oil fields globally, LNG is going to be one of the main future substitutes for oil, since like oil it can be dispatched to any destination in a tanker provided that the local infrastructure is available.…”

Section: Introductionmentioning

confidence: 99%

Global LNG trade: A comprehensive up to date analysis

et al. 2017

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the importance of liquefied-natural-gas (LNG) in global gas trade has grown steadily over the past decades; the paper focuses on this significant form of energy and provides an exhaustive portrait of its trade internationally. LNG trade flows both regionally and by country are described and the future of trade is forecast. Based on the description of trade flows, the business structure is discussed. The traditional LNG trade on long-term contracts (LTCs) is considered and it is explained how vital these contracts are in distributing the volume and price risks in the industry, furthermore, in securing finance for the LNG projects. The essence of gas market liberalization and its effect on LTCs is considered, it is shown that in liberalized gas markets, risk has migrated to upstream. In the light of this risk redistribution, the suppliers' intent in moving toward vertical integration of the industry is discussed. Next, various types of LNG spot sale in arbitrage and for uncommitted product to LTCs are considered and the biggest spot sale markets are identified. Finally, pricing of LNG for different markets in both LTCs and spot sales is discussed and it is forecast that due to the surge of supply rather than any change in oil prices, the LNG prices are anticipated to decrease globally at least for the next five years.

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“…In economic terms, the equivalent distance for on-shore pipelines is approximately 3,500 km (Michot Foss, 2007). The importance of LNG is rising as demand for it grows faster than demand for pipeline gas (Hawk et al, 2013). LNG is delivered through a supply chain made of four phases: the first is gas extraction from the reserve.…”

Section: Introductionmentioning

confidence: 99%

Spot sale of uncommitted LNG from Middle East: Japan or the UK?

et al. 2016

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the importance of liquefied natural gas (LNG) is rising as demand for it grows rapidly and steadily due to growth in energy demand, the transition to a low carbon economy and the longer distances over which natural gas is now traded. Given its importance, this work proposes an optimization model that assists to decide on when and where LNG should be delivered by coordinating tanker type, assignment and routing, inventory management, contract obligations, arbitrage and uncommitted LNG. The model maximizes the profit mainly by taking advantage of price differences between different markets.The contributions of this work are twofold. First, following the analysis of expenses and revenues, a new mixed integer programming model for LNG liquefaction and shipping is proposed from a corporate finance perspective. Furthermore, a solution approach for it is implemented and tested. Second, the model is used to derive a short term trade policy for the Middle Eastern LNG producers regarding the spot sale of their uncommitted product to Japan or to the UK, namely to: dispatch to whichever market has the higher current spot price, regardless of the variability of the transport expenses.

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Fast-Mover Advantages: Speed Capabilities and Entry into the Emerging Submarket of Atlantic Basin LNG

Cited by 15 publications

References 52 publications

25 Years of Real Option Empirical Research in Management

25 Years of Real Option Empirical Research in Management

Global LNG trade: A comprehensive up to date analysis

Spot sale of uncommitted LNG from Middle East: Japan or the UK?

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