Public Lecture: The Outlook for Energy: A View to 2040 By Lynne Taschner, Energy Advisor Corporate Strategic Planning Department, ExxonMobil on March 16, 2018 (13:30-15:30) PTT Auditorium, 2nd Floor, PTT Building 1
2018 Outlook for Energy: A View to 2040 Asia Pacific Energy Outlook Tour March 2018 The Outlook for Energy includes Exxon Mobil Corporation s internal estimates and forecasts of energy demand, supply, and trends through 2040 based upon internal data and analyses as well as publicly available information from external sources including the International Energy Agency. Work on the report was conducted throughout 2017. This presentation includes forward looking statements. Actual future conditions and results (including energy demand, energy supply, the relative mix of energy across sources, economic sectors and geographic regions, imports and exports of energy) could differ materially due to changes in economic conditions, technology, the development of new supply sources, political events, demographic changes, and other factors discussed herein and under the heading Factors Affecting Future Results in the Investors section of our website at www.exxonmobil.com. This material is not to be used or reproduced without the permission of Exxon Mobil Corporation. All rights reserved. #
Global trends continue to evolve Growth from 2016 level Percent 2016 2x GDP +25% demand +1.7 billion people +10% CO 2 emissions -45% CO 2 intensity 3
2018 Outlook for Energy Fundamentals What will the world s energy picture look like in the future? 4
Energy supports living standards 2016 Electricity demand per capita kwh per person Population Half of World population 2016 GDP per capita Thousands of PPP dollars 5
Non-OECD leads economic expansion GDP Trillion 2010$ GDP growth Trillion 2010$ Non-OECD 4.1% AAGR 1.9% AAGR Africa Other AP OECD India Europe United States China 6
Global Urbanization & Major Cities (2040) 2040 Percentage Urban 0-50% 50-75% 75-100% 2010 City 10 million + 2040 City 10 million + Source: United Nations and ExxonMobil estimates 7
Purchasing power expands GDP per capita Thousand PPP$ United States Global middle class Billion people Africa/Middle East Europe OECD China Asia Pacific World India Other AP Non-OECD Africa Latin America Europe North America Source: The Brookings Institution 8
2018 Outlook for Energy Demand Global energy demand will continue to rise through 2040, reflecting its fundamental link to expanding prosperity and better living standards for a growing population worldwide. 9
Developing Economies Dominate Growth Demand by Region Quadrillion BTUs 750 Rest of World 500 Other AP Non-OECD India 250 China OECD 0 1980 1985 1990 1995 2000 2005 2010 2016 2020 2025 2030 2035 2040 10
Energy demand varies by sector End-use energy demand Primary energy demand Quadrillion BTUs Quadrillion BTUs 300 Elec/ Mkt Heat Wind/ Solar 300 250 200 16 25 40 Hydro/ Geo Biomass Nuclear Coal Gas Liquids 250 200 16 25 40 150 150 100 100 50 50 0 0 1 2Industrial 3 4 5 Transportation 6 7 8 9 10 Res/Comm 11 12 13 Electricity 201620252040 Generation 11
Rising prosperity lifts chemicals energy demand Chemicals demand by region Quadrillion BTUs Fuel Feedstock North America Russia/ Caspian Europe Other Asia Latin America Africa Asia Pacific OECD India Middle East Mature Regions China Rest of Asia Pacific Rest of World Emerging Markets 12
Industry undergirds global economic expansion Heavy industry migrates to emerging markets Quadrillion BTUs Heavy industry evolves toward cleaner fuels Growth in Quadrillion BTUs China Mature Regions Rest of Asia Pacific Rest of World Coal Other Oil Gas Electricity/Market heat Mature Regions China Rest of Asia Pacific Rest of World Emerging Markets 13
Transportation Demand Sector Demand MBDOE Demand by Region MBDOE 75 Rail 30 16 25 40 Marine Aviation 50 Commercial 20 Heavy Duty 25 10 U.S. Light Duty 0 2000 2020 2040 0 OECD China India Other AP Non-OECD Rest of World 14
Global fleet increases and diversifies Fleet by type Million cars Efficiency curbs demand growth MBDOE Electric/Plug-in/ Fuel cell Full hybrid Natural gas/lpg Diesel Gasoline 15
Policy and consumer choices impact demand Electric vehicles grow rapidly Million cars Liquids demand remains resilient MBDOE Total liquids demand Plug-in hybrids Battery electrics Light-duty liquids demand Shaded ranges are indicative of potential shifts in demand relative to base Outlook 16
Electricity Demand Continues to Surge Electricity Demand by Region Thousand TWh Electricity Net Delivered by Type Thousand TWh 10 2016 40 China 8 30 Other Renewables 6 4 Other Asia Pacific United States Europe 20 Wind & Solar Nuclear Gas India 2 10 Coal 0 1980 2010 2040 0 2000 2020 2040 Oil 17
Renewables and gas capture growth Change in net delivered electricity 2016-2040 Thousand TWh Wind / Solar share of delivered electricity Share of TWh Solar capacity Wind capacity '40 Solar '16 Wind North America Europe Asia Pacific Middle East Africa World 18
Electricity generation by region highlights diversity Net delivered electricity Thousand TWh '25 '16 '40 Other renewables Wind/Solar Nuclear Gas Coal Oil 19
Policy and technology choices impact outcome Gas demand from electricity generation BCFD Lower nuclear/ coal use Africa Higher wind/solar penetration Middle East Other Asia Pacific India China Latin America North America Russia/Caspian Europe Shaded ranges are indicative of potential shifts in demand relative to base Outlook 20
Global Demand 2040 by fuel Quadrillion BTUs Average Growth / Yr. 2016-2040 0.7% 0.9% 2016 1.3% -0.1% 1.6% Hydro / Geothermal Solar / Wind / Biofuels Biomass Nuclear 21
2018 Outlook for Energy Supply What resources will be available to meet the world s increasing demand for more energy? 22
Liquids Supply World Supply by Type MBDOE 120 Other Liquids Biofuels By Region MBDOE 120 NGLs Other Non-OPEC 80 Tight Oil Oil Sands 80 Russia 40 Deepwater New Conventional Crude and Condensate Development 40 North America Developed Conventional Crude & Condensate OPEC 0 2000 2020 2040 0 2000 2020 2040 23
Gas supply highlights regional diversity Gas demand by supply type BCFD Supply type Share of growth 2016-2040 Production. LNG imports Pipeline imports Local unconventional production Local conventional production Total production Net exports Net imports '00 '16 '25 '40 North America Latin America Africa Europe Russia/ Caspian Middle East Asia Pacific 24
Asia Pacific Natural Gas Demand and Supply Demand by Country BCFD 150 Demand by Sector BCFD 150 Supply by Type BCFD 150 Rest of AP Transportation 100 Korea Japan India 100 Res/Comm 100 LNG SE Asia Industrial Pipeline 50 50 50 Local Unconventional China Electricity Generation Local Conventional 0 2000 2020 2040 0 2000 2020 2040 0 2000 2020 2040 25
LNG trade grows and diversifies Europe and Asia Pacific dominate LNG imports BCFD Asia Pacific Growth Rest of World Air quality management Climate/Energy policy Other Asia Pacific India China Japan/Korea/ Taiwan/Singapor e Europe Climate/Energy policy Gas import diversity Air quality management Chemical feed Climate/Energy policy Fuel supply diversity Backfill declining gas production 26
LNG trade grows and diversifies Europe and Asia Pacific dominate LNG imports BCFD Abundant gas supplies underpin new LNG exports BCFD Asia Pacific Growth Rest of World Other Asia Pacific India Rest of World Africa China North America Japan/Korea/ Taiwan/Singapor e Europe Middle East Asia Pacific 27
2018 Outlook for Energy Emissions The dual challenge of providing reliable, affordable energy to support prosperity and enhance living standards is coupled with the need to do so in ways that reduce impacts on the environment, including the risks of climate change. This is a challenge we take seriously. 28
Energy mix shifts to lower-carbon fuels Global energy mix Percent Energy-related CO 2 emissions peak Billion tonnes Other renewables Wind/Solar Nuclear Gas Middle East Africa Latin America Russia/Caspian Other Asia Pacific Oil China Europe Coal North America 29
Restraining energy-related CO 2 emissions Energy-related CO 2 emissions Billion tonnes 2000 GDP growth CO 2 intensity Energy efficienc y 2016 GDP growth CO 2 intensity Energy efficienc y 2040 30
Technology Contributes to the Fuel Mix Primary energy demand Quadrillion BTUs Other Renewables Nuclear Hydro Unconventional Gas Gas Deepwater, Oil Sands, Tight Oil Oil Coal Biomass Source: Smil, Energy Transitions (1800-1960)
2018 Outlook for Energy Energy matters As the world s population approaches 9 billion people in 2040, we are challenged to help improve living standards everywhere. We expect that progress will be powered by human ingenuity and the energy that helps make better lives possible. 32
Electricity from solar and wind increases about 400 percent Energy powers modern economies and living standards Global energy needs rise about 25%, led by non-oecd nations Natural gas expands role to meet a wide variety of needs Oil plays a leading role to aid mobility and modern products Electricity demand nearly doubles in non- OECD nations Decarbonization of the world s energy system will accelerate 33
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