Relying solely on traditional drilling technology to estimate the world's proven Oil Reserves denies the likelihood that billionsof barrels of unfound oil lay just outside the industry's technological reach. With substantial financial and legal assistance andgovernment support to develop newer technologies like Deep-Water Drilling (DWD), the major oil companies and the USWhite House are confident that new fields can be brought into production that should increase supplies and stabilize or lowerenergy prices. Each new find, they estimate, will help increase the world's proven oil reserves allowing investors andconsumers to feel more optimistic about providing for their future energy needs. It is also hoped that this new technology willlead to safer, more economic and environmentally appealing exploration and production methods (Belhaj, et al). Pertinent questions arise as to what impact BP's tragic oil spill may have on the future of Deep-Water Drilling and on thefuture of energy prices? Does industry have the technology to successfully and economically exploit fields using DWD? Whatrole should governments play in regulating dangerous, environmentally unsound drilling practices? Should regulations beallowed to impede progress? Identifying DWD as having a major influence on cost and being a critical parameter in any energy equation, the authorsanswer these questions and present two models that pessimistically and realistically describe the future role of DWD in placeslike China, India and Brazil over the next 50 years - places with growing populations and economies, but little governmentoversight. Conclusions are reached with a discussion about the need for DWD in the current economic slowdown in advanced economiesthat have witnessed decreased oil demand and why traditional models affecting energy prices have been unsuccessful inpredicting the current high energy prices.
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