Uncertainty in the Oil and Gas Exploratory Process: A Framework for Analysis and Econometric Estimation (Classic Reprint)

How economic incentives shape oil and gas exploration—and how to measure it.

A clear, rigorous framework shows how uncertainty, depletion, and price signals influence where and how explorers drill, and how those decisions affect discoveries and reserves.

This work presents a unified theory of the exploratory process in the petroleum industry. It compares different econometric approaches and explains why separating success ratios from discovery sizes improves estimates. Readers will see how expectations, risk, and inventory dynamics drive decision making and policy implications for natural gas and oil supplies.

• How explorers forecast returns and risk across oil, gas, and hydrocarbons categories
• Why the timing and type of drilling matter for success rates and discovery sizes
• How depletion, prices, and regulatory context influence model structure and data interpretation
• How to estimate relationships that reflect real-world choices and reduce econometric bias

Ideal for readers of energy economics, policy analysis, and econometric modeling who want a practical, testable framework for the exploration process.