The world’s biggest oil companies are failing to get value for money when they explore for new reserves, according to research by Wood Mackenzie, the energy consultant.

The report shows the commercial value of oil and gas discovered over the past three years by the 10 largest listed energy groups is running well below the amount they have spent on exploration.

The findings come at a time when international oil groups are considering how far to boost exploration budgets after years of falling investment. It also comes at a time when oil prices are reaching record highs as a result of soaring demand and limited surplus supplies.

Companies are spending record levels on developing known fields in regions such as the US Gulf of Mexico, west Africa and the Caspian Sea, which should guarantee production growth until 2008.

But Robert Plummer, corporate analyst at Wood Mackenzie, said: “After that they will need more discoveries to maintain growth . . . the problem is exploration has not been generating returns.”

Royal Dutch/Shell said last month it would lift yearly exploration spending to $1.5bn, up from a five-year average of $1.2bn, as it looks to boost stagnant oil production and recover from its reserves overboooking scandal. BP has also talked about “re-loading” on exploration after a period of being focused heavily on development.

Wood Mackenzie says the top-10 oil groups spent about $8bn combined on exploration last year, but this only led to commercial discoveries with a net present value of slightly less than $4bn. The previous two years show similar, though less dramatic, shortfalls.

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Mr Plummer said: “These figures will improve as more of the technical reserves discovered in these years are commercialised and initial reserve estimates are upgraded, but the value added through exploration for 2001-2003 is running well below the average for 1996-2000.”

The years 2001-2003 also saw a decline in reserves found by the top-10 oil groups after the discovery in 2000 of the vast Kashagan field in Kazakhstan.

While 2003 was inflated by a large gas discovery in Brazil by Petrobras, equivalent to 6bn barrels of oil, the trend of commercial discoveries has been downwards for three years.

Wood Mackenzie says it expects combined production at the companies to rise by 3.5 per cent yearly between now and 2008, driven by development spending on existing oil and gas fields which has risen from $34.6bn in 1998 to a record $49.5bn in 2003.

During the same period, exploration spending among the group of 10 companies fell from $11bn to $8bn, as capital discipline became the most important factor following a period of low oil prices.

Mr Plummer said even though “companies have been slow to react”, exploration spending is likely to rise on the back of record oil prices. However, “a number of constraints will continue to act on exploration performance, the most important of which is being access to material opportunities”.

The findings reflect the fears of some companies, who claim they need greater access to Opec nations to boost reserves. Thierry Desmarest, chief executive of Total, the French oil group, recently told the FT that oil companies could not discover enough new oil to ensure supply meets demand in coming years.