Oil and natural gas Peak Oil and ERoEl V Filip Černoch cerno ch@m ail .muni, cz CENTER FOR ENERGY STUDIES Modern 7bn people world Solar Energy CENTER FOR ENERGY STUDIES World total primary energy supply by fue (1971-2015) 16 000 Coal2 Hydro J_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_I_L 1971 m 1330 1385 1990 1995 3000 3005 3010 3015 Oil Natura gas BioFuels and waste Nuclear Other1 Note: Peat and oil shale aggregated with coal. CENTER FOR ENERGY STUDIES Peak Oil • A point in time when the maximum rate of extraction is reached and only decline in production is expected. •Based on Marion King Hubbert's (1903-1989) models (Shell, US Gelogical Survey). •Presentation in San Antonio in 1956 predicting U.S. oil peak for 1970. •Concept is being criticized for „Malthusian perspective". CENTER FOR ENERGY STUDIES Peak Oil concept 1850 1870 1890 1910 1930 1956 1970 1990 2007 2030 2050 year CENTER FOR ENERGY STUDIES Early peak" predictions Peak oil date Source and date of forecast 2006-2007 Bakhtiari f2004^ 2006 on Simmons (2006) After 2007 Skrebowski f2004^ Soon after 2007 World Enerp-v Council f2007^ 2009-2031 Sorrell et al. f2009^ Before 2010 Goodstein f2004^ Around 2010 Campbell f2005N) Possibly 2010 Klare f2004^ 2010 Aleklett et al. f2010^ After 2010 Skrebowski (2005) 2006-2017 Hiro f2007^ Soon after 2010 De Margerie. C. Total S.A. (Walt. 2010^ 2008-2012 De Almeida and Silva f2009^ 2012-2017 Koppelaar. 20 and Koppelaar. 2006 2008-2018 Robelius f2007^ 2014 Nashawi et al. f2010^ 2015 Shell f2008^ „Late peak" predictions Peak oil date Not before 2017 After 2020 After 2020 2020 or beyond 2035 2020 (for oil and gas) 2025 or later 2035 Not before 2035 No visible peak No peak but 54.2 years of global production Teak oil theories have been abandoned' 'Oil demand ... reaching a long plateau in the 2040s' Source and date of forecast CERA (2008) Hayward, T., BP (Macalister. 2010) CERA (Jackson and Esser. 2004) TEA (2010) Shell (2011) Davis (2003) CERA (Jackson. 2006) EIA (2010) Maugeri (2012) BP (2012) Mountains Scenario Oceans Scenario (Shell. 2013) Was Hubbert right? •Easily accessible oil and gas deposits are being depleted. •Decreasing discovery rate (fields 'too big to miss'). •But predicted peak repeatedly increased and postponed. • How to explain this contradiction? CENTER FOR ENERGY STUDIES Was Hubbert right? •Economic perspective — „oil reserves are the amount of oil that is minable at today's prices using existing technology" (proven, probable and possible reserves). • E&P in extreme conditions. •New techniques of extraction (unconventional oil and gas). •Increasing recovery rate - from 22% in 80s to 35% today. CENTER FOR ENERGY STUDIES US oil production since 1965 12.0 6.0 1965 1 968 1 971 1974 1 977 1 980 1 983 1 986 1 989 1 992 1 995 1 998 2 0 01 2 0 04 2 0 07 2 010 20Ü Data source: BP Statistical Review of World Energy 2014 © Robert Rapie CENTER FOR ENERGY STUDIES New areas of exploration - deep waters Wells drilled in excess of 1000 feet as deep (first in 1975), 5000 and more (1986) as ultra-deep. Gulf of Mexico, Brazil, West Africa. Reserve billion barrels: Onshore Offshore Deepwater 213 Mote: Figures are a representative sample of tile world's major oilfields in billion of barrels, source: world Energy Outlook 2010 © OECD/Iinternational Energy Agency 2010 CENTER FOR ENERGY STUDIES Location of deepwater drilling oil fields Gutfof Msxico UK Mauritania • India # Brazil / Ivory Coast nigeria a EquatoriaI Guinea Angola % a Congo « Indonesia é 1> Deepwaier uevelopnent areas "Golden Triangle' K under af deepwater cil fields belowMOm Source: Petraleun Economist CENTER FOR ENERGY STUDIES New areas of exploration - deep waters Traditional onshore drilling. •Limited impacts — considerable experience, physically limited possibility of spillage. •Impacts similar to mining operations in non-energy industry — land use, water and air pollution, dust, noise, transportation damages of habitats. • Long history of regulation in the EU and USA. CENTER FOR ENERGY STUDIES New areas of exploration - deep waters Offshore drilling • Complicated technology and hostile environment increase the risk of accidents and their impact. • Oil spillages in the water (lm3 = spillage up to lkm2). •Increase in a number of off-shore installations accompanied by more stringent regulation (2010 Gulf of Mexico - Directive 2013/30/EU on safety of offshore oil and gas operations). CENTER FOR ENERGY STUDIES High profile oil spills from offshore blowouts Date of incident Location incident and Spillage Details (Estimated figures) insured loss(S) 2S.1.69-12.2.69 Santa Barbara, California 80,000 -100,000 barrels Not available 3.6.79 - 23.3.80 IxtocWell, Mexico 3.3 million barrels 22,000.000 22.4.77-30.4.77 Ekofisk Norwegian Sector, North sea 202,381 barrels 6,887,000 1980 Funiwa Niger Delta, Nigeria 200,000 barrels 53,554,000 2.10.80-10.10.80 Arabian Gulf 100,000 barrels 1,300,000 21.8.09-3.11.09 Timor Sea, Australia/ Indonesia 28,800 barrels of condensate oil 425.000,000 20.4.10-15.7.10 Gulf of Mexico 4.9 million barrels, plus 11 fatalities and 17 injuries 2,560,000,000 Adapted from Willis Energy Loss Database and American Petroleum institute Analysis of US Oil Spillage 2009 CENTER FOR ENERGY STUDIES Transport of oi • One of the biggest threats in ship transportation — oil spill. Intentional (terorism, piracy) and unintentional (accident, collision,, running ashore, failure of the ship) accidents. • Risk is significantly higher in highly frequent areas — in 1995-2005 in Turkish Straits 269 accidents. •To stop VLCC or ULCC tanker 14 minutes and 3km are needed. • In 70s there were 25,2 leaks annually, in 80s 9,3 leaks, in 90s 7,8 and after 2000 3,4 leaks annually. • But with increasing capacity of tankers the oil spills are more severe with increasing environmental impacts. CENTER FOR ENERGY STUDIES il spills during the maritime transport of oi 35 30 1970-79: 24.5 spills per year on average 1980 89: 9.4 spills per year on average 1990-99: 7.7 spills per year on average s 2000 09: 3.2 spills per year on average 2010-15: 1.8 spills per year on average 1970 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012 2015 Annual number of spills to U.S. waters from facilities and pipelines, 1980 - 2004 3.000 # # & & # ^ # ^