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The AAPG/Datapages Combined Publications Database

AAPG Bulletin

Abstract


Volume: 49 (1965)

Issue: 9. (September)

First Page: 1561

Last Page: 1561

Title: Geologist's Role in Economics of Finding Oil in Mid-Continent Area: ABSTRACT

Author(s): R. C. Clinton

Article Type: Meeting abstract

Abstract:

The Mid-Continent geologist must become involved with the economics of oil-finding. Because the fields being found today are smaller, the development risk is greater. We must compensate by improving our technique of selecting exploratory drill-sites.

The costs of overhead, equipment, travel, promotion, geophysical work, etc. are increasing at a fairly steady rate. Drilling costs, however, are about the same because they have increased in certain areas and decreased in others. The price of oil remains the same, but the net price paid to the oil-finder is reduced by an increase in taxes and service fees for oil-gathering. The over-all cost of selecting and preparing an exploratory prospect for drilling has nearly doubled in the last 5 years.

The tax burden has now become so great that it seems necessary to incorporate tax savings in drilling and development programs to realize a profit comparable with other businesses. A larger number of geologists may be required to represent oil "deals" for sale to the general public, particularly to those in high tax brackets. Therefore, the geologist must be completely familiar with the Securities Act of 1933.

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Copyright 1997 American Association of Petroleum Geologists