 Measuring fossil fuel reserves: A simulation and review of the U.S. Securities and Exchange Commission approachDavid Vicknair, Michael Tansey and Thomas E. O'Brien Resources Policy, 2022, vol. 79, issue C Abstract: In its modernization of its reporting requirements, the U.S. Security and Exchange Commission (SEC) defined measures of oil and gas reserves which exaggerated price changes leading to volatile financial reporting of reserves. To predict future prices they defined “current prices” on the basis of a deterministic 12 month rolling average. They defined reserves to be “economically producible” based on a lagging measure, “current prices,” which converted a geophysical measure of fossil fuel formations into a price index of oil and gas prices. A simulation using actual crude oil prices from 2013 to 2021 pits these measures against a proposed measure, the expected economic resource amount, that accounts for uncertain outcomes, probabilistically weights price behavior, and eliminates false signals. Fitting into current SEC reporting procedures, the design provides a flexible platform upon which the SEC can accommodate the changing needs of the energy company stockholders and stakeholders. Keywords: Reserve accounting; Fossil fuels; Energy economics; Oil and gas; Regulation (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jrpoli:v:79:y:2022:i:c:s0301420722004718 DOI: 10.1016/j.resourpol.2022.103028 Access Statistics for this article Resources Policy is currently edited by R. G. Eggert More articles in Resources Policy from Elsevier |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.