218 PETROLEUM TECHNOLOGY, ECONOMICS, AND POLITICS
Studies that predict the timing of the hypothetical peak in oil
production (assuming no further discoveries of giant oil fields) use
different estimates of how much oil remains in the ground, and
these differences explain some of the wide ranges of these predictions. Estimates of how much oil remains in the ground are highly
uncertain because much of this data is self-reported and unverified
by independent auditors; many parts of the world have yet to be
fully explored for oil; and there is no comprehensive assessment
of oil reserves from nonconventional sources. This uncertainty surrounding estimates of oil resources in the ground comprises the
uncertainty surrounding estimates of proven reserves as well as
uncertainty surrounding expected increases in these reserves and
estimated future oil discoveries.
According to current estimates, more than three-quarters of the
world's oil reserves are located in OPEC countries. The bulk of
OPEC oil reserves is located in the Middle East, with Saudi Arabia,
Iran and Iraq contributing 41.8% to the OPEC total. OPEC member
countries have made significant contributions to their reserves in
recent years by adopting best practices in the industry. As a result,
OPEC proven reserves currently stand at 934.7 billion 900 billion
barrels while non-OPEC reserves, including Russia, are on the
order of 303.1 billion barrels (BP, 2008).
There has been surprise at the OPEC estimates of proven reserves
(Campbell and Laherrère, 1998) since OPEC estimates increased
sharply in the 1980s, corresponding to a change in OPEC's quota
rules that linked a member country's production quota in part
to its remaining proven reserves. Indeed, companies that are not
subject to the federal securities laws in the United States and their
related liability standards, include companies wholly owned by
various OPEC member countries where the majority of reserves
are located.
In addition, many OPEC countries' reported reserves remained
relatively unchanged during the 1990s, even as they continued
high levels of oil production. For example, estimates of reserves in
Kuwait were unchanged from 1991 to 2002, even though the country produced more than 8 billion barrels of oil over that period and
did not make any important new oil discoveries. The potential disbelief in the data reported by OPEC is problematic with respect to
predicting the timing of a peak in oil production because OPEC
holds most of the world's current estimated proven oil reserves.
On the basis of reserve estimates as of December 2007, of the
Studies that predict the timing of the hypothetical peak in oil
production (assuming no further discoveries of giant oil fields) use
different estimates of how much oil remains in the ground, and
these differences explain some of the wide ranges of these predictions. Estimates of how much oil remains in the ground are highly
uncertain because much of this data is self-reported and unverified
by independent auditors; many parts of the world have yet to be
fully explored for oil; and there is no comprehensive assessment
of oil reserves from nonconventional sources. This uncertainty surrounding estimates of oil resources in the ground comprises the
uncertainty surrounding estimates of proven reserves as well as
uncertainty surrounding expected increases in these reserves and
estimated future oil discoveries.
According to current estimates, more than three-quarters of the
world's oil reserves are located in OPEC countries. The bulk of
OPEC oil reserves is located in the Middle East, with Saudi Arabia,
Iran and Iraq contributing 41.8% to the OPEC total. OPEC member
countries have made significant contributions to their reserves in
recent years by adopting best practices in the industry. As a result,
OPEC proven reserves currently stand at 934.7 billion 900 billion
barrels while non-OPEC reserves, including Russia, are on the
order of 303.1 billion barrels (BP, 2008).
There has been surprise at the OPEC estimates of proven reserves
(Campbell and Laherrère, 1998) since OPEC estimates increased
sharply in the 1980s, corresponding to a change in OPEC's quota
rules that linked a member country's production quota in part
to its remaining proven reserves. Indeed, companies that are not
subject to the federal securities laws in the United States and their
related liability standards, include companies wholly owned by
various OPEC member countries where the majority of reserves
are located.
In addition, many OPEC countries' reported reserves remained
relatively unchanged during the 1990s, even as they continued
high levels of oil production. For example, estimates of reserves in
Kuwait were unchanged from 1991 to 2002, even though the country produced more than 8 billion barrels of oil over that period and
did not make any important new oil discoveries. The potential disbelief in the data reported by OPEC is problematic with respect to
predicting the timing of a peak in oil production because OPEC
holds most of the world's current estimated proven oil reserves.
On the basis of reserve estimates as of December 2007, of the