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Steven Andrews Inteviews Richard Nehring On Global Oil Production Projections

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hatrack Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-09-07 08:11 PM
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Steven Andrews Inteviews Richard Nehring On Global Oil Production Projections
Edited on Tue Oct-09-07 08:12 PM by hatrack

Q: Richard, what is your biggest concern about world oil production going forward?

A: Over the next two decades, adding enough new production. There isnt an immediate resource constraint. But how much of that resource will we be permitted to develop and how much will actually be produced? There is a need to start thinking about a transformation away from oil. Some people think we need to focus on a package of conservation, efficiency, and renewable energy. Others think we need to focus on developing oil production. Well need both. But ultimately we need to rethink whole patterns of energy use. We need to transform the way we use energy and the types we use, not just use less.

Q: What do you assume is the worlds oil depletion rate right now?

A: I pretty much agree with the IEA (International Energy Agency) figure of 4%. That includes recompletions and well work-overs but excludes new wells and new projects.
Its a hard job to determine these depletion rates. We dont know the details. But if its 4%, that means we have to add 3.3 million barrels a day of new production capacity just to keep world production level. Saudi Aramco reports a 2% depletion rate. They were having significant problems with production dropping due to depletion in some key zones, wells watering out, and other factors. Apart from all their new developments projects, to hold the line on this depletion rate, they have a major ongoing effort to maintain their existing production capacity by reworking wells and drilling infill wells in existing fields.

Q: Did the Hedberg conference last fall reach a consensus about reserves and resources?

A: There was no official consensus estimate for anything: discoveries, future potential discoveries, proved reserves, etc. We discussed and debated these and many other factors about supply, but we made no effort to reach a consensus and we didnt reach one. This is in contrast to the comments Ray Leonard made at the ASPO-6 conference about findings at the Hedberg conference. We didnt focus so much on who was right but more on why the estimates of undiscovered resources differ. We explored these differences in great detail. For example. consider Brazil. Petrobras had much lower undiscovered resource estimates than the USGS for their offshore basins. But Petrobras was only evaluating the oil above the salt layer, while the USGS was evaluating the amount both above and below the salt layer. Following a few subsequent discoveries, Petrobras is now more enthusiastic about their subsalt potential.


Q: Where do you think world oil production will be in 2020?

A: I have a hard time seeing us get to 90 million barrels a day by 2020. I can see us getting there, but on a project-by-project basis, I dont know the full quantitative impact that new developments in old fields will have. This is a major unresolved question. I dont know anyone who really has studied and understands it seeing us ever reaching 100 million barrels a day requires a major stretch on my part.


Ed. - please note the last paragraph. What he's saying is that he has "a hard time" seeing us increase production by (approximately) 7 million b/d per year over 12 years.

That is, by 583,000 b/d per year, or about one-eighth of the putative production of Ghawar per year for a little more than a decade, using the entire world as a resource base.
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brokensymmetry Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-09-07 08:38 PM
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