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The marginal cost of extracting light crude oil in australia and the analysis of specific policy issues
Author(s) -
Thampapillai Dodo J.,
Kolednik Rudi
Publication year - 1990
Publication title -
international journal of energy research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.808
H-Index - 95
eISSN - 1099-114X
pISSN - 0363-907X
DOI - 10.1002/er.4440140402
Subject(s) - crude oil , marginal cost , context (archaeology) , economics , production (economics) , light crude oil , economic analysis , natural resource economics , econometrics , petroleum engineering , agricultural economics , engineering , microeconomics , geography , chemistry , archaeology , organic chemistry
The paper illustrates a method to derive the long run marginal cost (LMRC) of extracting light crude oil in Australia. This LMRC function is then used in the evaluation of domestic crude oil production operations in the context of changing world oil prices. The criterion for evaluation is economic rent. This criterion is applied in terms of two social objectives, namely economic efficiency and import reduction.