An economic analysis of crude oil exploration in Saskatchewan and Alberta

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Date
2002-08-22Author
Kamsari, Haul
Type
ThesisDegree Level
MastersMetadata
Show full item recordAbstract
The International market of crude oil and natural gas is well established and very competitive. Knowledge about costs is important in helping to understand the current position of producers within the industry. In the eyes of the producers, the lower the costs the more profitable they will become given the price of crude.
This thesis focuses on an economic analysis of crude oil exploration in Saskatchewan and Alberta. In a competitive market, the producers require estimates of finding costs in both regions. The public policies that are designed to encourage crude exploration also rely heavily on reliable estimates of these costs.
The results show that Saskatchewan’s per-unit finding cost is significantly lower than Alberta’s in spite of the geological differences between the two provinces. The finding costs are estimated by using a methodology (Uhler 1979) that has been widely accepted within economic literature of non-renewable resources. The results support the hypothesis that finding costs in both regions are increasing and the argument that these costs will converge in the long-run, except for the last six years of the analysis.
Degree
Master of Arts (M.A.)Department
EconomicsProgram
EconomicsSupervisor
Paus-Jenssen, ArneCommittee
Tran, Kien C.; Furtan, W. Hartley; Bruneau, Joel F.; Bishopp, William D.Copyright Date
August 2002Subject
land
royalties
taxation
finding cost
discovery process
exploration activities
crude oil
oil prices
public policies