World Oil & Gas Resources

World Oil & Gas Resources

Ken ChewOctober 2, 2008

42ND ANNUAL IPLOCA CONVENTION

Athens, Greece

2Copyright © 2007 IHS Inc. All Rights Reserved.

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= 50%= 50%80


World Liquids SupplyWorld Liquids Supply

World Annual Liquids Production 1960-2007(includes condensate, NGLs and oil sands)

0

5,000

10,000

15,000

20,000

25,000

30,000

1960 1965 1970 1975 1980 1985 1990 1995 2000 2005

Mill

ion

Bar

rels

OPEC ProductionNon-OPEC Production

OPEC production includes Ecuador (1973-1992) and Gabon (1975-1994), and Angola (joined 2007); also includes OPEC NGLs

Kuwait Gulf War losses

13.6 million b/dOPEC production decline from 1979 and 11.3 million b/d shut-in capacity


World Liquids SupplyWorld Liquids Supply

World Annual Liquids Production 1960-2007(includes condensate, NGLs and oil sands)

0

5,000

10,000

15,000

20,000

25,000

30,000

1960 1965 1970 1975 1980 1985 1990 1995 2000 2005

Mill

ion

Bar

rels

0

25

50

75

100

125

150

175

200

US

Dol

lars

OPEC ProductionNon-OPEC ProductionOil Price in 2007 Dollars

OPEC production includes Ecuador (1973-1992) and Gabon (1975-1994), and Angola (joined 2007); also includes OPEC NGLs

Kuwait Gulf War losses

13.6 million b/dOPEC production decline from 1979 and 11.3 million b/d shut-in capacity


Recoverable Conventional Liquids & Natural Gas ResourcesRecoverable Conventional Liquids & Natural Gas Resources

Discovery TrendsTotal Discovered Resources to End-2007 versus Number of Discoveries

0

100,000

200,000

300,000

400,000

500,000

600,000

Pre-19

0101

- 05

06 - 1

011

- 15

16 - 2

021

- 25

26 - 3

031

- 35

36 - 4

041

- 45

46 - 5

051

- 55

56 - 6

061

- 65

66 - 7

071

- 75

76 - 8

081

- 85

86 - 9

091

- 95

96 - 2

000

2001

-0520

06-07

Mill

ion

Bar

rels

Oil

Equi

vale

nt

0

500

1,000

1,500

2,000

2,500

3,000

Dis

cove

ries

in P

erio

d

Gas

Liquids

Number of Discoveries

Gachsaran

BurganGhawar

Ahwaz

Marun

Urengoy

North Field / South Pars

Astrakhan

Kashagan

(excludes USA and Canada)


World Liquids ResourcesWorld Liquids Resources

The Key IssueAnnual Liquids Discovered versus Annual Liquids Production

0

20,000

40,000

60,000

80,000

100,000

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

Mill

ion

Bar

rels

Annual Recoverable Resource Additions5-Year Moving Average Annual Resource AdditionsAnnual Liquids Production


Discovered & Remaining Recoverable World Liquids ResourcesDiscovered & Remaining Recoverable World Liquids Resources

Produced and Remaining Discovered Recoverable Conventional Liquids Resources at end-2007 (with percentage depletion)

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

1,000,000

North America Latin America Europe Former SovietUnion

Africa Middle East Asia-Pacific

Mill

ion

Bar

rels

Remaining Discovered Conventional Liquids @ 1 Jan 2008

Cumulative Conventional Liquids Production

31.6%

47.5%48.6%

83.9%

49.6%73.0% 58.9%

Worldwide Liquids Discovered: 2,370 billion bblWorldwide Cumulative Production: 1,130 billion bblWorldwide Remaining Liquids: 1,240 billion bblWorldwide Liquids Depletion: 47.6%


Future Production

Discovered Resources

ResourceGrowth

Unconventional Resources

Yet-to-Find


Negative• Some “stranded” accumulations will not be developed.

Positives

• North American estimates are 1P (“proved”) reserves, not 2P (“proved plus probable”) resources.

• Only “developed” resources of oil sands / extra-heavy oil are included.

• No allowance is made for resource growth.

• No allowance is made for “yet-to-find” discoveries made after 31 Dec 2007.

Remaining Recoverable World Liquids ResourcesRemaining Recoverable World Liquids Resources(Low(Low--end Estimate)end Estimate)


Remaining Recoverable World Hydrocarbon ResourcesRemaining Recoverable World Hydrocarbon Resources

Resource Growth

Also known as “reserves growth” or “field growth”, this term describes the increase in recoverable resources that commonly occurs over time, as oil and gas fields are developed and produced.

Mechanisms• New-pool discoveries: increases in-place

• Improved technology: increases recovery

• Commodity price: increases investment in IOR and infill drilling

• Field micro-management: allocation of investment


Discovery / Production Balance 2004 - 2007

World Recoverable Liquids ResourcesWorld Recoverable Liquids Resources

Recoverable Liquid Resource Additions, 2004 - 2007

-10

0

10

20

30

40

50

LiquidAdditions

2004

LiquidsProduction

2004

LiquidAdditions

2005

LiquidsProduction

2005

LiquidAdditions

2006

LiquidsProduction

2006

LiquidAdditions

2007

LiquidsProduction

2007

Bill

ion

Bar

rels

LiquidsResourceGrowth

LiquidsDiscovery


World Recoverable Liquids ResourcesWorld Recoverable Liquids Resources

Reserves Growth in the Forties Field, UKForties Field (UK) Annual Oil Production

0

100,000

200,000

300,000

400,000

500,000

600,000

1975

1980

1985

1990

1995

2000

2005

Bar

rels

per

Day

Apache acquires BP interestand operatorship of Fortiesin April 2003


World Recoverable Hydrocarbon ResourcesWorld Recoverable Hydrocarbon Resources

Undiscovered Hydrocarbons (“Yet-to-Find”)


RecentlyRecently--discovered Recoverable Liquid Volumes discovered Recoverable Liquid Volumes vsvs YetYet--toto--FindFind

USGS Estimate of Undiscovered Liquids at 1 Jan 1996 versusRecoverable Liquids Discovered between 1st Jan 1996 and 31st Dec 2007

0

50,000

100,000

150,000

200,000

250,000

300,000



Mill

ion

Bar

rels

USGS Undiscovered Conventional Liquids Estimate @ 1/1/1996

Conventional Liquid Additions 1996-2007

Conventional Liquid Additions 1996-2007 with 25% Resource Growth

US estimateas of 2007

21.1%

10.5%

14.8%

43.8%

10.9% 57.2%

Worldwide Liquids Additions 1996-2007 (excluding North America): 20.8%


Liquids Resource PlaysLiquids Resource Plays

Canada: Alberta Oil Sands - Geology


Liquids Resource Play Types

Liquids Resource PlaysLiquids Resource Plays

• Bitumen in oil-sands (Alberta, Canada);

• Extra-heavy oil (Orinoco Belt, Venezuela);

• Fractured self-sourcing reservoirs (Bakken Shale, Williston Basin; Barnett Shale, Fort Worth Basin; Bazhenov Formation, West Siberia);

also shale oil (USA; Estonia; Brazil; China; Queensland) and liquids from coal (South Africa; China) but strictly speaking these are conversion technologies.


World Recoverable Liquids ResourcesWorld Recoverable Liquids Resources(High(High--end Estimate)end Estimate)

Produced and Remaining Recoverable Liquids Resources at End-2007 (including resource growth, undeveloped oil sands / extra-heavy oil, and yet-to-find)

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

NorthAmerica

Latin America Europe FormerSoviet Union


Mill

ion

Bar

rels

Remaining Undeveloped Oil Sands and Orinoco with Resource GrowthUndiscovered Conventional Liquids (USGS) @ 1 Jan 2008 with Resource GrowthConventional Liquids Resource GrowthRemaining Discovered Conventional Liquids @ 1 Jan 2008Cumulative Conventional Liquids Production

32% depleted

(51% withoutoil sands) 19% depleted

(31% without Orinoco extra-heavy)

45% depleted

30% depleted

34% depleted

22% depleted

47% depleted

Worldwide Ultimate: 4,065 billion bbl(excl. oils sands/extra-heavy: 3,505 bill bbl)

Worldwide Remaining: 2,935 billion bbl(excl. oils sands/extra-heavy: 2,375 bill bbl)

Worldwide Depletion: 27.8%(excl. oils sands/extra-heavy: 32.2% )


Ultimate Liquids ResourceUltimate Liquids Resource

Global Liquid Resources In-Place (billion bbl)

5,298

2,241

1,814

990

1,398

535

1,121

6

2Remaining Discovered Conventional

Produced Conventional

Undiscovered Conventional

Remaining Discovered Bitumen

Produced Bitumen

Undiscovered Bitumen

Remaining Discovered Extra-Heavy

Produced Extra-Heavy

Undiscovered Extra-Heavy

Source: IHS estimate based on various published sources

Total Discovered: 9,640 billion bblTotal Undisc / Inferred: 3,765 billion bblUltimate Resource: 13,405 billion bblTotal Produced (end-2007): 1,129 billion bbl

Bitumen

Extra-Heavy

Conventional


World Natural Gas ResourcesWorld Natural Gas Resources

Annual Gas Discovered versus Annual Gas Production

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

Bill

ion

Cub

ic F

eet

Annual Resource Additions

5-Year Moving Average Annual Resource Additions

Annual Gas Production


Discovered and Remaining Recoverable World Gas ResourcesDiscovered and Remaining Recoverable World Gas Resources(Low(Low--end Estimate)end Estimate)

Produced and Remaining Discovered Recoverable ConventionalNatural Gas Resources at end 2007 (with percentage depletion)

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000



Bill

ion

Stan

dard

Cub

ic F

eet

Remaining Discovered Gas @ 1 Jan 2008Cumulative Gas Production

28.4%

81.7%

8.8%31.6%61.4%

27.6% 22.9%

Worldwide Gas Discovered: 10,350 tcfWorldwide Cumulative Production: 3,290 tcfWorldwide Remaining Gas: 7,060 tcf (1,175 bill boe)Worldwide Gas Depletion: 31.8%


Discovery / Production Balance 2004 - 2007

World Recoverable Natural Gas ResourcesWorld Recoverable Natural Gas Resources

Recoverable Natural Gas Resource Additions, 2004 - 2007

-10

0

10

20

30

40

50

GasAdditions

2004

GasProduction

2004

GasAdditions

2005

GasProduction

2005

GasAdditions

2006

GasProduction

2006

GasAdditions

2007

GasProduction

2007

Bill

ion

Bar

rels

Oil

Equi

vale

nt

Gas ResourceDecline

GasDiscovery

GasResourceGrowth


RecentlyRecently--discovered Recoverable Gas Volumes discovered Recoverable Gas Volumes versusversus YetYet--toto--FindFind

USGS Estimate of Undiscovered Gas at 1 Jan 1996 versusRecoverable Gas Discovered between 1st Jan 1996 and 31st Dec 2007

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

2,000,000



Bill

ion

Stan

dard

Cub

ic F

eet

USGS Undiscovered Gas Estimate @ 1/1/1996Gas Additions 1996-2007Gas Additions 1996-2007 with 12% Resource Growth

21.5% 12.6%

8.3%32.6%

13.2%

79.6%

Worldwide Gas Additions 1996-2007 (excludingNorth America): 20.3%

US estimateas of 2007


Gas Resource PlaysGas Resource Plays

Source: Total


Gas Resource Play Types

• Coal Bed Gas (“CBM”; “CSG”; Natural Gas from Coal)

• Anomalously-Pressured Basin-Centre Gas (also known as “deep gas” or “tight sand gas”)

• Tight Self-Sourcing Lithologies (shale; chalk)

and in the future

• Gas Hydrates (clathrates: methane trapped in lattice of ice)

Gas Resource PlaysGas Resource Plays


World Recoverable Natural Gas ResourcesWorld Recoverable Natural Gas Resources(High(High--end Estimate)end Estimate)

Produced and Remaining Recoverable Natural Gas Resources at End-2007 (Including Reserves Growth and Conventional and Non-Conventional Yet-to-Find)

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000



Bill

ion

Stan

dard

Cub

ic F

eet

Undiscovered / Undeveloped Non-Conventional GasUndiscovered Gas (USGS) @ 1 Jan 2008 with Resource GrowthGas Resource GrowthRemaining Discovered Gas @ 1 Jan 2008Cumulative Gas Production

33% depleted

18% depleted 34% depleted

16% depleted

19% depleted

6% depleted

13% depleted

Worldwide Ultimate: 18,480 tcf(excl. non-conventional: 16,070 tcf)

Worldwide Remaining: 15,190 tcf(excl. non-conventional: 12,780 tcf)

Worldwide Depletion: 17.8%(excl. non-conventional: 20.5%)


Ultimate Recoverable Hydrocarbon ResourcesUltimate Recoverable Hydrocarbon Resources

SummaryEstimated Ultimate Recoverable World Liquid and Gas Resources

1,128548

1,177

296

1471,241

806

839

558

400

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

Liquids Natural Gas

Bill

ion

Bar

rels

Oil

Equi

vale

nt

Estimated Remaining Recoverable UnconventionalYet-to-FindResource GrowthRemaining Discovered ConventionalCumulative Production @ End-2007

(Canada oil sand; Venezuela EH)

(excl hydrates)


Remaining Recoverable World Hydrocarbon ResourcesRemaining Recoverable World Hydrocarbon Resources(High(High--end Estimates)end Estimates)

Positives• USGS World Petroleum Assessment 2000 does not

encompass all prospective petroleum provinces.

• IHS estimates of the gains from resource growth are considerably more conservative than those of the USGS.

Negatives• Undiscovered resources remain speculative until discovered.

• Unlikely that undiscovered potential can be found and developed within the time frame required to meet forecast demand growth through 2030.

The resources are there for the medium term The resources are there for the medium term --the issues are all about increasing production.the issues are all about increasing production.

Increasing project complexity Increasing project complexity –– in production in production andand transport:transport:deep water; Arctic; EH & oil sands; LNG; sour gas; tight gas.deep water; Arctic; EH & oil sands; LNG; sour gas; tight gas.

Investment requirement:Investment requirement:the ambivalent position of the major resource holders.the ambivalent position of the major resource holders.

The end of cheap oil creates its own cost spiral as theThe end of cheap oil creates its own cost spiral as theenergy component of production and transport grows.energy component of production and transport grows.

The ultimate cost could be to the planet –but what are the realisable alternatives?

Documents

World Oil & Gas Resources