The Efficiency of Joint Ventures in the Extractive Industry

The research studies economic effects of engagement in joint ventures for extractive industries’ enterprises. The study investigates the matter both on the level of individual mineral deposits and on the level of mining companies owning them. The main part of the work is structured in three chapters. First chapter is dedicated to the literature review and provides theoretical explanation for the creation of value trough joint ventures. Second chapter covers the statistical analysis of the data from companies reports and market data. The sample is comprised of a number publicly traded mining companies and deposits managed by them. Main methods used for the empirical part are linear and logistic regressions. Third chapter is focused on the practical use of the conclusions from the previous two in the strategic investment planning for metals and mining companies. The final conclusion is that joint ventures are not a more economically efficient form of field ownership and are usually used either for legislative reasons or in cases where the development of a field by a single participant is not economically feasible.