I think there is a world market for maybe 5 computers (Thomas Watson, IBM chairman, 1943) plateau (Irving Fischer, prof of economics, Yale U.

Size: px

Start display at page:

Download "I think there is a world market for maybe 5 computers (Thomas Watson, IBM chairman, 1943) plateau (Irving Fischer, prof of economics, Yale U."

Jean Rogers
6 years ago
Views:

1 The Oil Peak syndrom: Facts and Myths Alain Labastie, 2011 President Society of Petroleum Engineers 1

2 Forecasts by experts or gurus are often unreliable I think there is a world market for maybe 5 computers (Thomas Watson, IBM chairman, 1943) Stocks have reached a permanently high plateau (Irving Fischer, prof of economics, Yale U., 1929) 640K ought to be enough for anybody (Bill Gates, 1981)

3 Outline Historical background Demand trends The role of energy conservation Hydrocarbons Resources & Reserves Climate security vs. Energy security Concluding remarks

4 Historical background Oil peak predictions have been made on a regular basis over the 20th century In 1918, oil peak was predicted for the late 20s In 1972, the Club of Rome predicted a decline of oil production in the 90s It never happened (worldwide basis)

5 Historical background In 1956, Hubbert predicted the oil production from the lower 48 states (USA) to peak between 1965 and 1970 This actually happened in 1970 But the deline is now stopped

6 The decline of oil production in the USA (lower 48 states) (*) Discoveries are registered as per their initially declared sizes and their timing is «forwarded» by 33 years Source : King Hubbert Updated by Jean Laherrere 2009 production (onshore + continental shelf) : Gb

7 The question today As hydrocarbons are present in finite quantity, the question is not if there will be a peak in production The question is: when? 80 years from now 20 years Next year Last year

8 Demand trends 2005 Data Source IEA/Wikimedia

9 Demand trends - China car sales overtook U.S. car sales in January Demand in developping countries - New offer

10 Demand trends: 1.6 billion people have no access to electricity East Asia 224 Others 101 South Asia 706 Africa (Subsahara) 547 (Numbers shown above in millions) Source IEA,2006

11 World primary energy demand in the Reference Scenario Mtoe Oil Coal Gas Biomass Nuclear Hydro Other renewables Source: IEA-WEO Global energy demand grows by 1.6% per year to 2030, by which time fossil fuels account for 80% of the energy mix down slightly on today

12 Demand trends We must expect a strong energy demand during the next decades Hydrocarbons will continue to play a key role, substitution will take a long time in many domains Market flexibility is limited (specially for oil), tensions are likely

13 Energy conservation will play a role Seen in city street Las Vegas by night

14 Energy conservation will play a role Mineral water from the French Alps Picture taken in the Rocky Mountains USA (you can take the same in many places worldwide)

15 Reserves and resources, conventional oil (worldwide) - Oil cumulative production, current = 1.07 Gbbls - Remaining conventional oil reserves = 1.1 Gbbls (ca. 40 years production at today s rate) - Reserves yet to be found = 1.3 Gbbls (ca. 40 years production) - Increasing the average recovery factor from 35% to 45 % = 1.0 Gbbls (ca. 40 years production). This is the target for technology

16 Production trends for the Ekofisk, Varg, Oseberg and Ula fields Oil rate (mill. scm per year) Ekofisk Oil rate (mill. scm per year) 2,5 2 1,5 1 0,5 Varg Oil rate (mill. scm per year) Oseberg Prognosis at PDO Oil rate (mill. scm per year) Actual production Ula Source: Norwegian Petroleum Directorate

17 The resource triangle (after S. Holditch) Small volumes, easy to produce Light/medium oil Conventional gas Heavy oil Tight gas Oil sands Oil shales Gas shales Large volumes, challenging to produce

18 Long term oil supply cost curve Oil price insuring a profitability > 10% $/bbl Oil shales Deep water Ultra deep water Extra Heavy Extra Heavy oil oil Arctic Other Conventional OPEC Middle East Enhanced Recovery Billions of barrels Sources : AIE, Total

19 The production capacity challenge World oil production Mb/d = Million barrels per day Mb/d Increasing Producing demand fields and decline natural decline of producing fields require to 52 Mb/d (~5% of production to 6%/year) between 2005 and 2015 coming from new fields 20 Estimated demand growth (~1% to 1.5%/year) Required capacity increase

20 The production capacity challenge 2008 production: ca. 85 Mbbl/d 2018 production requirement: ca. 95 Mbbl/d Required new production: 45 Mbbl/d ( not 10 Mbbl/d )

21 Resources and reserves Hydrocarbon resources are abundant, may cover needs for one century The challenge is to convert these resources into reserves, then production Easy oil has gone (mostly), this will be challenging and will require a lot of efforts: - Technology - Capital - Staff intensity

22 Various world oil production profile forecasts

23 Oil production forecast Oil production constrained by technology and investments, not by geology (in the mid term) Oil production likely to reach a plateau (ca. 100 Mbbl/d) by 2020 This plateau to stay for a while

24 Climate security is an issue CO 2 concentration in atmosphere (ppm)

25 Share of energy sector in GHG emissions Deforestation 17% Agriculture 14% Other GHG 12,5% Others 5% Transportation 13% Oil & Gas 33,5% Coal 23% Building 8% Industry Power generation 7,5% E&P Refining 5% Power generation & industry 18% End Users = 28,5% Operations = 5% Oil & Gas 33,5% Source : GEC & IEA

26 New fossil fuel sources, more CO 2 emissions Conventional oil 5 10 kg/bbl Extra heavy oil (cold production) w/ upgrading 40 kg/bbl Bitumen (SAGD) w/ upgrading 100 kg/bbl GTL (gas to liquids, Fischer Tropsch process) 150+ kg/bbl BUT CO2 sources are concentrated, much easier to capture

27 The E&P industry is developing technology for CO 2 capture & geological storage: An integrated CCS project at Lacq (France) CO 2 injection CO 2 transportation Gas production CO 2 capture Compression CO 2 injection CO 2 storage m 8 CO 2 Transportation 7 Purification / CO 2 dehydration Commercial gas Utilities Boiler oxycombustion Steam 5 4 Natural gas Lacq gas treatment plant 3 10 Compression 6 Oxygen Production Unit Natural gas inlet 2 CO 2 Rousse reservoir Lacq gas production 4000 m 1 Lacq deep gas reservoir

28 Concluding remarks Oil & gas still a major source of energy beyond the end of the century Oil production likely to reach a plateau by 2020, and stay at this level for a while Limitations are mostly technology and investment, not resources (which are abundant)

29 Consequences (likely) Oil & gas production will become more staff intensive (reversal from the past trend) Paradoxically, this may become a golden age for the oil & gas industry: high price, high technology Logic for oil & gas prices will change: they will be related to those of their substitute (reversal from the past)

30 And, most important The perception by the the general public of what is environmentally acceptable is quickly changing In the future, the issue of energy security will have to go with climate security (together, not opposed)

31 SPE Mission To collect, disseminate, and exchange technical knowledge and to provide opportunities for professionals to enhance their technical and professional competence. 31

32 SPE Today: Global, Diverse Membership 92,000 members in 118 countries 169 member sections 197 student chapters 32

spe.org Discounts on conferences, forums, workshops Visiting lectures by distinguished experts Intangible

33 Member Benefits Tangible Journal of Petroleum Technology (monthly) Membership in Technical Interest Groups, technical sections, geographic sections Discounts on technical papers, books, periodicals Online resources Discounts on conferences, forums, workshops Visiting lectures by distinguished experts Intangible Leadership opportunities Networking Add professional standing to your resume Give back to the industry by sharing knowledge 33

34 SPE Technical Papers 50,000+ SPE technical papers in multisociety library (80,000+ total papers) 1,700 new papers added annually Historical papers back to million downloads per year 125 papers downloaded per hour 34

35 SPE Events 100+ conferences, forums and workshops each year globally To reduce or eliminate travel expense: SPE is placing technical conferences and workshops close to major petroleum operations 35

36 SPE Student Member Growth 2008: 22,400 student members at university chapters in 52 countries 36

37 SPE Accelerates Transition for University Students Student Development Opportunities Regional Student Paper Contests develop paper writing and presentation skills Ambassador Lecturer Program - young professionals visit student chapters to talk about career experiences Special student activities tutoring, field trips, events Networking - interact with practicing professionals Technology resources local section meetings, SPE online resources ementoring and online technical groups connect to professionals globally to get answers to technical and career questions

38 Keys to SPE s Success Respected resource for technical knowledge Diverse, global membership Member-driven Lifelong opportunities for career development Neutral, non-competitive and non-commercial exchange 38

Brunei s Energy Future: a Global Perspective Yves Grosjean General Manager Total E&P Borneo

Brunei s Energy Future: a Global Perspective Yves Grosjean General Manager Total E&P Borneo National Environment Conference, 01 July 2010, The Empire Hotel and Country Club DISCLAIMER and COPYRIGHT RESERVATION