Oil reserves Development in world oil consumption

Oil reserves

Development in world oil consumption

World proved reserves

Reporting of reserves can not always be trusted

Projecting future discoveries

Real discovery trend and production

“Peak oil”

Discoveries and production USA “Lower 48”

Discoveries and production Norway

Norway and UK creaming curves

Discoveries and production Saudi Arabia

Saudi Arabia: Ghawar ‘Ain Dar/Shedgum Area / Arab D resource depletion state 2004

Ghawar and the world

• Ghawar has produced about 60% of all Saudi Arabian oil from 1951-2004 and still accounts for some 50% of the Saudi production

• When Ghawar output declines, Saudi production will most likely have peaked

• After peak in Saudi Arabia it is difficult to envisage a global increase in conventional oil production

Russian production and growth rate

Oil discoveries and production world total

All petroleum

IEA demand growth prediction

New production to satisfy demand

Composition of energy demand

Monthly production of cars in China

Developing countries’ consumption in perspective

Summary

• 90% of world oil reserves are not audited

• Consumption has exceeded new discoveries since 1980

• Today 25% of the consumption is replaced by discoveries

• Modern seismic was developed after 1960

• Peak discovery world wide happened in the 1960s

Summary contn.

• US (Lower 48) production peaked in 1971; predicted by King Hubbert in 1954

• Norway production peaked in 2001; 2005 production below NPD estimate

• Oil production outside OPEC and FSU seems to have peaked

• Creaming curve for back dated reserves for regular oil indicated total global reserves of 2 trillion barrels

• Approximately 1 trillion barrels is consumed to date

Summary contn.

• IEA is a demand focussed agency, with limited emphasis on resources

• BP is not auditing the reserves reported in their annual statistical reports

• USGS reported resources in the Arctic has uncertainties equal to the estimates for undrilled basins

• With the exception of the Arctic and the Antarctic and a few politically closed areas, the oil and gas potential is understood

Summary contn.

• The Ghawar field found in 1948 has produced 60% + of Saudi oil, is now producing approx. 5 million bopd and is approaching its tail.

• When Ghawar peaks, Saudi will have peaked and so will the world.

• Indications are that the OPEC “swing production is about to be exhausted

Summary contn.

• Peak means that production can no longer be increased; we have then produced about half of the oil

• After peak the price of oil will be market driven