Decline Curve

AAA

DEFINITION of 'Decline Curve'

A method for estimating reserves and predicting production in oil reservoirs and oil fields. The decline curve shows how oil and gas production rates decrease over time.

INVESTOPEDIA EXPLAINS 'Decline Curve'

Most decline curves are based on exponential, hyperbolic or harmonic Arps equations, but tend to have shortcomings such as underestimating reserves, underestimating production rates, or overestimating reservoir performance. The Arps equations were developed in the mid-1900s but are still used today despite their limitations.

RELATED TERMS
  1. Enhanced Oil Recovery - EOR

    Enhanced oil recovery (EOR) is the process of obtaining stranded ...
  2. Estimated Ultimate Recovery - EUR

    A production method commonly used in the oil and gas industry. ...
  3. Rig Utilization Rate

    A ratio used in the oil services industry that measures the amount ...
  4. Barrels Per Day - B/D

    A measure of oil output, represented by the number of barrels ...
  5. Sweet Crude

    A type of oil that meets certain content requirements, including ...
  6. North Sea Brent Crude

    A type of oil that is sourced from the North Sea. This type of ...
Related Articles
  1. Peak Oil: What To Do When The Wells ...
    Economics

    Peak Oil: What To Do When The Wells ...

  2. Oil And Gas Industry Primer
    Active Trading

    Oil And Gas Industry Primer

  3. Uncovering Oil And Gas Futures
    Active Trading

    Uncovering Oil And Gas Futures

  4. Fueling Futures In The Energy Market
    Options & Futures

    Fueling Futures In The Energy Market

comments powered by Disqus
Hot Definitions
  1. Halloween Massacre

    Canada's decision to tax all income trusts domiciled in Canada. In October 2006, Canada's minister of finance, Jim Flaherty, ...
  2. Zombies

    Companies that continue to operate even though they are insolvent or near bankruptcy. Zombies often become casualties to ...
  3. Witching Hour

    The last hour of stock trading between 3pm (when the bond market closes) and 4pm EST. Witching hour is typically controlled ...
  4. October Effect

    The theory that stocks tend to decline during the month of October. The October effect is considered mainly to be a psychological ...
  5. Repurchase Agreement - Repo

    A form of short-term borrowing for dealers in government securities.
  6. Correlation

    In the world of finance, a statistical measure of how two securities move in relation to each other. Correlations are used ...
Trading Center