Oil Peak – A Geologist’s
View
Francis Harper, BP plc
Energy Institute, November 2004
How long will current reserves last?
Reserve Adds:
35
15 years
• Exploration
• Reserves Growth
• Nonconventionals
1000 bn bbl
Production (bn bbl)
30
25
10 years
21 years
31 years
20
15
10
5
10% Decline
5% Decline
3% Decline
1.5% Up, 5% down
0
A 40 year supply?
25 bn bbl
p.a.
10
20
30
Years
40
50
60
Exploration
100
Discovered
Produced
90
80
70
60
50
40
30
20
10
0
1950
1960
1970
1980
1990
• Reversal in discovery decline largely due to
the deepwater exploration theme – will this
continue?
• Is Kashagan unique or are there other
supergiants?
• Are the peak years of ’99 and ’00
anomalous?
Data based on those of IHS Energy
2000
• Decreasing trend in volumes
found from the early 60’s (peak)
to the early ’90’s.
• Slight increasing trend over
the last decade.
• Production exceeds
discoveries for last ca. 20 years
• Are these numbers
consistent?
Discovered Volumes (bnbbl)
Discovered Volumes (bnbbl)
Exploration Potential – Discovery Trend
25
20
Kashagan
Deepwater
Other
15
10
5
0
1990
1995
2000
Exploration
GoM
15
10
5
0
50
100
150
Discovery sequence
12
Niger
10
8
6
4
2
0
0
GoM
10
20
30
Discovery sequence
Niger Delta
20
Campos
15
10
5
0 Failure
Uneconomic Success
0
10
20
30
40
Economic
Success
Discovery sequence
Data based on those of IHS Energy
Lwr. Congo
Campos
Discovered OE (bnboe)
0
Discovered OE (bnboe)
Ca. 1500 Exploration wells
Ca. 120 basins tested
Ca. 30 with discoveries
Ca. 20 w. economic disc.
20
Discovered OE (bnboe)
Discovered OE (bnboe)
Deepwater Basins – Success and Failure
14
12
10
8
6
4
2
0
Congo
0
10 20 Deepwater
30 40 50
Discovery sequence
= >500m
Exploration
Oil and Gas Fields >= 10 bn bbl oil equiv.
Volumes overviewed for field growth potential
Original Reserves (mmboe)
350
300
250
• Ca. 50 Fields with >10
bnboe ultimate Potential
• Kashagan is the only new
supergiant oil field found in
the last 25 years
Qatar North,S.Pars
200
150
Ghawar
100
50
0
1900
Shtokman
1910
1920
Data based on those of IHS Energy
1930
1940
1950
1960
1970
1980
1990
Kashagan
2000
Exploration
Oil and Gas Basins >= 10 bn bbl oil equiv.
Volumes overviewed for growth and YTF
600
Original Reserves (mmboe)
• Ca. 50 Basins with >10
500
400
Arabian
300
W.Siberia
bnboe ultimate Potential of
which ca.5 discovered pre1900
• No major new oil province
found since the North Sea
other than as deepwater
extensions of known basins
200
N.Sea
100
S.Barents
0
1900
1910
1920
Data based on those of IHS Energy
1930
1940
1950
1960
1970
1980
1990
2000
Exploration
Field Sizes and Success Rates
450
Average field size (mmboe)
400
40
35
Exploration Success Rate (%)
500
Average discovery sizes
have tracked total
discovery volumes
declining to about 50
mmbbl by 1980.
350
300
250
200
150
30
25
20
15
10
100
5
50
0
1950
Success rates from
new-field wildcats has
increased from ca 1 in 6
to ca 1 in 3 over the last
50 years
0
1960
Data from IHS Energy
1970
1980
1990
2000
1950
1960
1970
1980
1990
2000
Exploration
Exploration Potential Summary
•
Discovered volumes have been declining since the end of
the ’60s
•
The deepwater theme of the ’90s has helped to reverse
this trend but this will not last indefinitely
•
The number of supergiant oil fields and the number of
giant oil provinces have fallen off markedly in recent years
•
Maximum and average field sizes are declining
BUT
•
Drilling success rates are rising, driven by advances in the
technology of imaging
Reserves growth
Discovery estimates grow with time
100
2003 Est.
1997 Est.
Annual Discoveies (bn bbl)
90
• Ca. 200 billion bbl added to
discovery estimates (’50-’96)
between ’97 and ‘03
• Growth applies primarily to
the bigger, older fields
80
70
60
50
40
30
20
10
0
1950
1960
Data from IHS Energy annual reports
1970
1980
1990
2000
Reserves Growth
2500
2000
During the 11 years to 2003,
the IHS estimate of cumulative
discovered volumes to 1990
has increased by an average
of 40 billion bbl per year
1993 Rpt
1994 Rpt
1995 Rpt
1996 Rpt
1997 Rpt
1998 Rpt
1999 Rpt
2000 Rpt
2001 Rpt
2002 Rpt
2003 Rpt
1500
Growth to 1990 Cum
Reserves
Cumulative Discovered Volumes (bn bbl)
Growth in IHS Reserves – World
1000
500
60
50
40
30
20
10
0
1993
1996
1999
2002
0
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000
Data from IHS Energy annual reports
Reserves Growth
Sources of Field Reserves Growth
Addition
(Shallower Pool)
Revisions/
Improved Recovery
Extension
(Structural)
Addition
(Satellite)
Extension
(Stratigraphic)
Fields grow either by increases in
Hydrocarbons-In-Place (extensions,
additions) or by increases in
Recovery actor (revisions, improved
recovery)
Addition
(Deeper Pool)
Reserves Growth
Growth by Improved Recovery
Plots below based on ca. 9000 fields worldwide with recovery factors
- containing ca. 1400 bbo with average RF of 30%
200
Volumes in Fields (bbo)
1800
1600
No. of Fields
1400
1200
1000
800
600
400
200
0
0-5
10-15 20-25 30-35 40-45 50-55 60-65 70-75 80-85
Recovery Factor Bands
180
160
140
120
100
80
60
40
20
0
0-5
10-15 20-25 30-35 40-45 50-55 60-65 70-75 80-85
Recovery Factor Bands
• The average global oil recovery factor is about 30-35%
• Original Discovered Reserves are about 1950-2200 billion bbl
• Original Discovered In-place volumes are about 5500-7000 billion bbl
• Every 1% increase in average global recovery factor adds about 55-70
billion bbl reserves, almost equivalent to a UK North Sea
Data from IHS Energy database
Reserves Growth
Reserves Changes in UK Oil Fields
Reserves change Factor
Individual field reserves changes may
be positive or negative and can easily
2 the size of a field. On
half or double
average, 1.8
however, fields tend to grow.
1.6
1.4
1.2
Average
1
0.8
0.6
0.4
0.2
0
0
2
4
6
8
10
12
14
16
18
20
Years since Annex B
Data from DTI Brown Book reports
All fields with >100 mmbbl and >7 years data
Reserves Growth
Reserves Growth Potential Summary
•
Reserves estimates are uncertain and will change with
time – these can go up or down but on average will be
positive.
•
•
Reserves growth is primarily a function of big, old fields.
•
Most of discovered oil remains in the ground – this is
potentially an enormous prize with a 1% increase in global
recovery adding about 55-70 bn bbls.
Growth occurs both by increasing hydrocarbons in-place
and by increasing recovery factor.
BUT
•
Increasing recovery is difficult and expensive and most of
reserves growth adds may not affect global peak
production
Nonconventional Oil
Resource Type and Distribution
Canada
36%
(Extra)Heavy Oil
Oil Shale
Others
9%
Bitumen
USA
32%
MidEast
1%
Venezuela
19%
Africa
3%
7 trillion bbl Oil-in-Place
Data from IEA 2004 (WEO)
Nonconventional Oil
12
10
GTLs (+?)
Non-conv Resource
• IEA projects nonconventional
8
production growing at ca. 8%
p.a. to about 10 mmbpd by 2030
• in 2030, 23% of this is
expected to be GTLs (+CTL,
Biofuel?)
6
4
2
0
2000
2010
2020
Nonconventional production is
still only a small fraction of
total estimated IEA production
(ca. 5% in 2020)
2030
Production Potential (mmbpd)
Production Potential (mmbpd)
Production Potential
140
120
100
Nonconv
Conventional
80
60
40
20
0
1980
1990
2000
2010
2020
2030
Nonconventional Oil
Summary of Nonconventional Potential
•
Nonconventional Oil sources include
–
–
–
–
–
–
Heavy oil
Bitumen
Oil shale
Fractured source rock
Gas-to-liquids
Biofuels
•
Heavy oil and bitumen are the most important in resource
terms and are dominated by Venezuela and Canada
respectively
•
The resource base is very large and it will become an
important part of future supply
BUT
•
There are large monetary and environmental costs
involved and the rate of growth relative to the demand is
limited
Distribution, Maturity of Conventional Oil
N.America
360 bnbl
FSU
330 bnbl
Europe
80 bnbl
AsiaPacific
130 bnbl
Africa
190 bnbl
MidEast
810 bnbl
World
Reserves
Produced
2100 bnbl
S.America
200 bnbl
• Most regions of the world are either at
or past the mid-point of depletion
• MidEast (and FSU and Africa) have
produced <50% of their known resource
2
Summary
•
Existing discovered reserves are unlikely to sustain
demand for more than about 15 years
•
Exploration cannot be expected to replace production and
its contribution may continue to decline
•
Reserves Growth is likely to continue as the dominant
form of reserve adds but much of it will only slow postpeak production decline
•
Nonconventional oil will become increasingly important –
there is a very large resource but converting it into
reserves has significant financial and environmental costs
•
Non-OPEC is likely to reach a resource-constrained
production peak from conventional oil in the next 10 years
– thereafter production capacity will be concentrated in
progressively fewer countries