How are supermajors replacing reserves?

The combined proved reserves for the five supermajors declined 31% from ~80bnboe at end-2018 to ~55bnboe at end-2023. bp saw the largest decline in proved reserves, from ~20bnboe to ~7bnboe, largely reflecting its Russian exit.

On aggregate, the supermajors replaced 48% of production organically in the past five years, referring to additions from extensions & discoveries and improved recovery. ExxonMobil achieved the highest organic replacement ratio at 80%. Chevron was the largest net buyer of reserves, adding ~2.2bnboe, including major purchases of Noble in 2020 and PDC in 2023.

At the end of 2023, ExxonMobil reported booked reserves equivalent to more than 12 years of its production, whilst BP currently has a reserves to production ratio of less than eight years. If the supermajors intend to maintain the current level of reserves, additional M&A can be expected.

Westwood’s latest Wildcat research note looks at how supermajors have been replacing reserves over the past five years, and what it could mean for the future of exploration.

Wildcat subscribers can access the report here.

KeyFacts Energy Industry Directory: Westwood Global Energy