LONDON, Sept. 21 (UPI) -- A new energy industry study shows that the costs of finding additional reserves of oil and gas have skyrocketed.
"Reserves replacement costs surged 73 percent as increased capital spending did not translate into incremental reserve additions," a study of 200 oil and gas companies found, the Financial Times reported Thursday.
Proven world reserves of oil and gas increased 2 percent to 257.7 billion barrels, while production increased 1 percent just short of 19 billion barrels, John S. Herold from the Houston-based research company Harrison Lovegrove and author of the study.
"They are spending 30 percent more just to stand still," said Rodney Schmidt, managing director at Harrison Lovegrove. "The money has been there, but the barrels have not."
The industry spent more money producing the extra 1 percent, rather than exploration. Companies spent $36 billion on exploration last year. The decline in exploration has been the result of limited access to foreign oil and gas fields. Instead companies have been looking into riskier areas like Mexico and Saudi Arabia, which have typically kept their doors closed to foreign investors.
