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The future of oil and gas |
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The future scenario for oil and gas can be developed from the statistics of world reserves.
OilLet us first take a look at the figures for oil reserves by country and by region as at the 1st of January 2004. The figure for reserves, expressed in number of years equivalent, is calculated by dividing total reserves by the 2003 production level. Throughout we are talking of proven reserves only.
| Country |
Reserves (billions of barrels) |
Number of years equivalent |
| United States |
21.9 |
10 |
| Mexico |
15.7 |
14 |
| Canada |
5 |
6 |
| Venezuela* |
77.8 |
82 |
| Brazil |
8.5 |
16 |
| Equator |
4.6 |
32 |
| Norway |
10.4 |
10 |
| United Kingdom |
4.7 |
6 |
| Russia |
60 |
22 |
| Kazakhstan |
9 |
30 |
| Azerbaijan |
7 |
62 |
| Saudi Arabia* |
261.9 |
94 |
| Iran* |
125.8 |
100 |
| Iraq* |
115 |
155 |
| Kuwait* |
99 |
143 |
| United Arab Emirates* |
97.8 |
129 |
| Qatar* |
15.2 |
61 |
| Oman |
5.5 |
17 |
| Libya* |
36 |
75 |
| Nigeria* |
25 |
32 |
| Algeria* |
11.3 |
24 |
| Angola |
5.4 |
17 |
| China |
18.3 |
15 |
| India |
5.4 |
22 |
| Indonesia* |
4.7 |
10 |
* Member countries of OPEC (Organisation of Petroleum Exporting Countries) |
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Thus it can be seen that several Middle Eastern countries, all members of OPEC, together hold 2/3 of worldwide oil reserves, with a special mention for Saudi Arabia which alone possesses ¼ of these world reserves. OPEC in total holds 80% of world reserves, whereas, at the moment, it only produces a little less than 40% of the oil consumed throughout the world. Naturally this translates into a very high number of years equivalent, often exceeding 100 years. Logical conclusion: the Middle East, already a strategic zone for oil production, is going to become more and more so as years go by.
Total oil reserves today represent 40 years or so of consumption. But this has been the case for several decades. That means that, until now, the oil consumed has been replaced by new reserves (exploration discoveries, improvements in recovery from existing fields, increases in oil prices making development of expensive oil fields more economic). At the beginning of the 21 st century, we are at a turning point. Exploration and discovery of new fields is not capable by itself of renewing reserves. Even if we can still count on improvement in recovery rates, oil will be exhausted several decades from now. But before this point of total exhaustion, the threat of shortages in the immediate future hangs over us, that is to say in the next 5 years for the pessimists and the next 25 years for the more optimistic: supply will no longer be capable of responding to an ever-increasing demand: we will have attained the Hubbert Peak for oil.
The “post-oil” era, therefore, should be of concern to us, even today. Of immediate importance is the rapid development of replacement sources of energy allowing the oil that remains to be reserved for “noble” uses (the manufacture of plastics, synthetic fibres …) and above all the achievement of very significant energy savings, particularly in the major consumer countries.
Gas
Gas reserves as at the 1 st of January 2004 are as follows, with the number of years equivalent calculated on the 2003 consumption level:
| Country |
Reserves (billions of m3) |
Number of years equivalent |
| United States |
5,354 |
10 |
| Canada |
1,673 |
9 |
| Argentina |
664 |
15 |
| Bolivia |
680 |
100 |
| Trinidad and Tobago |
733 |
30 |
| Venezuela |
4,191 |
140 |
| Netherlands |
1,756 |
25 |
| Norway |
2,118 |
30 |
| United Kingdom |
629 |
6 |
| Russia |
47,578 |
75 |
| Ukraine |
1,121 |
55 |
| Azerbaijan |
850 |
165 |
| Kazakhstan |
1,841 |
130 |
| Turkmenistan |
2,011 |
35 |
| Uzbekistan |
1,875 |
30 |
| Iran |
26,620 |
340 |
| Iraq |
3,115 |
> 1000 |
| Kuwait |
1,572 |
190 |
| Oman |
829 |
50 |
| Qatar |
25,771 |
830 |
| Saudi Arabia |
6,545 |
110 |
| United Arab Emirates |
6,007 |
135 |
| Algeria |
4,531 |
55 |
| Egypt |
1,657 |
60 |
| Libya |
1,314 |
185 |
| Nigeria |
4,503 |
235 |
| Australia |
2,549 |
71 |
| China |
1,510 |
4 |
| India |
854 |
30 |
| Indonesia |
2,557 |
35 |
| Malaysia |
2,124 |
40 |
| Pakistan |
760 |
30 |
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Gas is a little more evenly spread throughout the world than oil. However, the Middle East and the CIE group of countries (Community of Independent States, set up following the dismemberment of the USSR) together hold almost three quarters of world reserves. At the same time, the domestic reserves of the United States and China have been reduced to several years of production. As for oil, a major bout of geostrategic fisticuffs is in preparation for access to gas reserves!
There are 65 years of world reserves, based on 2003 demand – the same thing as saying that the problem of the future of gas is the same as that of oil, but with a lag of twenty years of so. This lag applies not only to the exhaustion of reserves, but also to the Hubbert Peak for gas that is expected to arrive 15 - 20 years after that of oil. Gas therefore provides us with breathing space that must be used in the
best way possible to prepare for the “post-hydrocarbon” era. |
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