Energy Literacy Advocates Newsroom
Energy Literacy Advocates (ELA) is a non-partisan, non-profit, public education and advocacy group dedicated to improving the energy literacy of all sectors of our democracy in order to empower a comprehensive national energy policy that is responsible and sustainable. Stay tuned for updated energy news!
Monday, February 11, 2008
World Oil Decline Rate
The following letter excerpt appeared in the February 4th, 2008 edition of the Oil and Gas Journal in response to a recent study by Cambridge Energy Resources (CERA) that estimated an average 4.5% annual decline rate in oil production (view the press release accompanying this study here):
"The January 17th 2008 press release by Cambridge Energy Research Associates…reported the world’s oil supplies were to rise to 112 million b/d by 2017. This rise is in spite of CERA’s other conclusion that the world’s oil fields are declining in capacity at the average rate of 4.5%/year. These conclusions are clearly suspect.
"Although it is unlikely that global oil production is likely to drop significantly in the next few years, major sustainable increases are equally unlikely. Given the current global production of 86 million b/d and CERA’s 4.5% decline, global capacity would have to increase by 7.5 million b/d each year for the next 10 years to reach 112 million b/d. This is a total of 75 million b/d of new capacity in 10 years. Even excluding the effect of declining rates, achieving 112 million b/d within a decade represents a massive leap of 26 million b/d in global capacity.
"To put this in perspective, 75 million b/d of new capacity is the equivalent of eight new Saudi Arabias or 14 new Irans in just 10 years. Considering the reality that Saudi Arabia, with 25% of the world’s best proven reserves, is already investing $50 billion to increase its production capacity by 2 million b/d, where does CERA expect the additional 24 million b/d of production capacity to come from, let alone the replacement for the 51 million b/d of declines?"
Dr. Moujahed Al-Husseini, GeoArabia; Manama, Bahrain
Dr. Sadad Al-Husseini, Saudi Aramco (retired); Dharan
"The January 17th 2008 press release by Cambridge Energy Research Associates…reported the world’s oil supplies were to rise to 112 million b/d by 2017. This rise is in spite of CERA’s other conclusion that the world’s oil fields are declining in capacity at the average rate of 4.5%/year. These conclusions are clearly suspect.
"Although it is unlikely that global oil production is likely to drop significantly in the next few years, major sustainable increases are equally unlikely. Given the current global production of 86 million b/d and CERA’s 4.5% decline, global capacity would have to increase by 7.5 million b/d each year for the next 10 years to reach 112 million b/d. This is a total of 75 million b/d of new capacity in 10 years. Even excluding the effect of declining rates, achieving 112 million b/d within a decade represents a massive leap of 26 million b/d in global capacity.
"To put this in perspective, 75 million b/d of new capacity is the equivalent of eight new Saudi Arabias or 14 new Irans in just 10 years. Considering the reality that Saudi Arabia, with 25% of the world’s best proven reserves, is already investing $50 billion to increase its production capacity by 2 million b/d, where does CERA expect the additional 24 million b/d of production capacity to come from, let alone the replacement for the 51 million b/d of declines?"
Dr. Moujahed Al-Husseini, GeoArabia; Manama, Bahrain
Dr. Sadad Al-Husseini, Saudi Aramco (retired); Dharan
Labels: oil supply/demand, peak oil
posted by Jamie Lang at 4:35 PM
0Comments:
Post a Comment
<< Home