Slide 18 of 20 1. Market forces (such as prices for oil, costs
of investment, and the pace of technological advance) may smooth
and flatten the sharp peaks of the estimated production
profiles. This graph shows the effect on the estimated peak
production year when the methodology is altered to produce a
rounded peak. (The rounded peak was generated by gradually
decreasing the production growth rate from 2 percent to zero and
then gradually increasing the production decline rate from zero
to 5 percent.) 2. The rounded production peak is estimated by
assuming that both production curves recover the same volume of
conventional oil and both decline at about the same final rate
(5 percent per year.) 3. The rounded peak occurs 7 years earlier
and at a lower production rate than the sharp peak case. 4. This
is generally true - a rounded peak occurs earlier than a sharp
peak for the same resource base and yearly production growth
rate.