Oil companies are concerned to replace the petroleum reserves they produce in order to maintain their future level of activity. Reserves also represent an important input when analysts value these companies. However, they have to rely on booked reserves, which are subject to measurement errors. Many producer countries want to control their own resources, a goal which can come into conflict with the desire of the international companies for booked reserves. Where oil companies do not own the reserves, they may have insufficient incentives to maximise value – harmonising goals between a resource country and an oil company can be difficult. This chapter discusses the relationship between reserves and financial incentives, and between reserves and valuation. The issues are illustrated throughout with reference to two cases: StatoilHydro’s projects on Shtokman in Russia and Peregrino in Brazil.