, Columnist
The Mysterious Case of Big Oil's Disappearing Barrels
Price gains won't help firms replace lost reserves, but M&A could.
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If you ever find yourself at a cocktail party with a bunch of oil executives, one phrase is a guaranteed mood-killer: "reserve replacement."
Not merely awkward to say, it is the industry's bogeyman. Because in a business chiefly concerned with getting stuff out of the ground, you need to replace that stuff pretty consistently unless you want to, well, eventually run out of stuff.