U.S. reserve replacement costs for the 50 largest producers soared 73% to $8.20 per barrel of oil equivalent (BOE) in 2001, while reserve replacement rates plunged 40% to 141% of oil production and 34% to 152% of gas production, reports John S. Herold Inc. in its annual analysis. "Reserve replacement costs were the second highest in the last five years, falling below only the dreadful figures recorded in 1998," says Nicholas D. Cacchione, senior vice president and research director for the Norwalk, Connecticut-based independent research and consulting firm. Finding and development costs jumped 73% to $8.99 per BOE, while proved acquisition costs rose 49% to $6.53 per BOE. Capital spending for the 50 companies, meanwhile, dropped 13.4% to $43.5 billion as a 35% surge in exploration and development costs was more than offset by a dramatic 58% plunge in proved acquisition spending. BP Plc was the biggest U.S. spender at $4 billion, down 70% from its $12.7 billion of domestic E&P outlays in 2000.
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