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markets actually love assets with stable long term revenues. The more stable the revenue, the lower the discount rate you need to apply to future income streams, and thus the higher the valuation.

For a fully certain income stream, investors are happy with a 3.5% return these days. So the "value" of the whole offshore production could conceivably be equal to 30 times net revenues from annual production...

Wind power

by Jerome a Paris (etg@eurotrib.com) on Thu May 20th, 2010 at 05:40:46 AM EST
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