clipped from: www.americanthinker.com   

All oil wells decrease in production.  Each oil well has an “economic limit” defined as the number of barrels of oil per day which is required to keep the well from losing money.  This economic limit determines the life of the well and the proven oil reserves for the well.  The equation for the economic limit of an oil well is the daily operating cost divided by one minus the tax times one minus the royalty times the oil price.  The economic limit of an oil well is determined by entering the daily operating cost, tax, royalty, and oil price into the equation.  A higher tax on oil raises the economic limit, decreasing the life of the well, resulting in decreased proven oil reserves.  With an equivalent loss occurring in each of the half million oil wells in the United States, the loss in proven oil reserves to the United States from an increase in tax on oil can be in the billions of barrels.  Attention Secretary Salazar and Economist Roner!