Four oil and gas majors - ExxonMobil, BP, Shell and Total Energies - added over two billion barrels of new reserves to their books in 2023.

The additions - from fresh exploration and engineering extensions built to existing fields - came even as the same four companies reported a decrease in their Net Reserves Balance (NRB) of 1.2 billion barrels.

This apparent contradiction is possible because the Net Reserves Balance, the traditional metric by which oil companies measure their "booked barrels", is not adjusted to the energy transition. Companies are reporting what resources they can produce to shareholders. Net Reserves Balances are a combination of the physical reality on the ground with other considerations, such as the market price of oil making reservoirs more or less likely to be producible for profit, sales and purchases of oil fields from one company to another, and so on. The NRB has been in place in reserves classification systems for nearly a century.

New Resources and Reserves (NRR) take a different starting point - the remaining carbon budgets available to contain global heating. From this perspective what counts is the change in the physical and engineering reality on the ground - and which reserves and resources have been freshly added to the pile. NRR quantifies ongoing exploration in the oil and gas industry, even as all Net Zero scenarios suggest production should be starting to wind down.

The contrast between the two metrics is striking. There are 16 reserves reports in this graphic - one for each year and each company. Twelve out of the 16 have negative Net Reserves Balances for various reasons - in 2020 the price collapse, the impact of the war in Ukraine on management of producing assets in Russia. But in all 16 reports new reserves and resources are added by fresh exploration. Negative NRB therefore gives a misleading picture in terms of how the world is decarbonising.