Analysts at Shell are considering how much to bid in a government auction for drilling rights in a new lease area in the Gulf of Mexico. Using forward prices for oil, the analysts have calculated the present value of cash flows from drilling in the area to be $20 million. Based on the company's recent experience in similar auctions, the analysts do not expect Shell to be able to win the auction unless it bids at least $25 million, which implies at best an NPV of negative $5 million.Therefore, the analysts suggest not participating in the auction. However, the CEO is not convinced. In her words, "Our NPV calculation is based on oil forward prices from the futures market.I have found the futures market to be quite unreliable in predicting where oil prices are headed. I think that oil prices will be quite high over the next several years, implying that our present value estimate is too low. I think that a more accurate estimate of the value of cash flows from drilling is $30 million, and we should certainly be willing to pay $25 million to win." Is the CEO's argument valid? Please provide the rationale behind your answer.