Survey says Oil Reserves are not being Replaced

In a report by research consultants Wood Mackenzie, energy companies are not replacing production with new commercial discoveries. According to a six-year survey ending in 2002, nine out of 25 firms surveyed did not replace reserves, including some of the major players in the oil and gas industry.

The stagnation in new commercial discoveries will eventually prove to be a problem with the bigger firms as they try to sustain growth. Five of the nine companies who haven’t replaced reserves are majors or super-majors. Unless the reserves are replaced, exploration cannot continue to be the engine that fuels the companies’ growth.

Wood Mackenzie used BP for an example saying that it would need to add around 1.3 billion barrels a year to sustain its position. “Between them, all the western majors need to find the equivalent of the current remaining reserves in Angola every 15 months or of the UK North Sea every 18 months just to replace production