Exhaustion

Nothing will be remaining due to the continuous extraction of resources. The resources in the oil wells, mine fields will become nothing due to continuous extraction should be replaced by new exploration. To invest on the new exploration in order to have continuous exploration which requires the depreciation as a charge against the revenues of the fields.

Example, Oil & Natural Gas Corporation Ltd. (ONGC) indulges in the process of new oil exploration projects through research projects. Then the new projects should be identified and invested by huge initial investment outlay through the current revenues out of the existing projects on account of replacement due to depletion of

resources.