Giant oil field decline rates and their influence on world oil production

The most important contributors to the world's total oil production are the giant oil fields. Using a comprehensive database of giant oil field production, the average decline rates of the world's giant oil fields are estimated. Separating subclasses was necessary, since there are large differences between land and offshore fields, as well as between non-OPEC and OPEC fields. The evolution of decline rates over past decades includes the impact of new technologies and production techniques and clearly shows that the average decline rate for individual giant fields is increasing with time. These factors have significant implications for the future, since the most important world oil production base – giant fields – will decline more rapidly in the future, according to our findings. Our conclusion is that the world faces an increasing oil supply challenge, as the decline in existing production is not only high now but will be increasing in the future.     

The taxation of UK oil and gas production: Why the windfalls got away

Starting with evidence that United Kingdom Continental Shelf oil and gas companies have benefitted very disproportionately from the recent period of extraordinarily high oil prices, this paper traces the history of this weakness in the UK’s petroleum fiscal regime. Evidence is provided that the progressive relaxations in the UK’s petroleum fiscal regime in 1983, 1987–1988 and 1993 were: largely unnecessary to stimulate the development of new, smaller, ‘marginal’ fields; misguided in their assumption that such fields were more costly to develop than earlier counterparts or larger contemporary fields; and impotent compared with the effects of oil price movements. The paper concludes with a conceptualisation which illuminates why these failures of policy were not just random: they emerged from the UK’s ‘non-proprietorial’ stance with respect to the country’s oil and gas resources, a stance which assumes responsibility for oil company profitability and vainly tries to counter market forces at the expense of government revenues.     

The implementation of a multi-annual agreement for energy efficiency in The Netherlands

The paper analyses the implementation of the second multi-annual agreement for energy efficiency concluded in the Netherlands with industrial sectors for the period 2002–2010. It aims to investigate whether the multi-annual agreement MJA2, as a voluntary instrument, is sufficiently stimulating behavioral change at the target group level, and sustained transformation of production and management patterns towards significant gains in energy efficiency. The analysis uses a Structure–Conduct–Performance analytical framework for implementation processes in order to: (a) analyze the setting of implementation, actor roles, attitudes and interactions; (b) discuss emerging obstacles and positive experiences with the implementation of the three core policy instruments envisaged: energy management system, process efficiency measures, and ‘expansion themes’ measures. Based on this policy recommendations are formulated regarding voluntary agreements in general, using the Structure–Conduct–Performance framework of implementation analysis, and regarding how the implementation process of MJA2 in particular could be improved.     

New technology for the comprehensive utilization of Chinese oil shale resources

In China, the conventional utilization of oil shale is concentrated mainly on retorting oil shale to produce shale oil and fuel gas, and burning oil shale to generate electricity. The growth of petroleum price, and the development in heavy industry, make these conventional utilization facilities become unavailable on the energy market. In this paper, a new comprehensive utilization system is recommended for the future use of Huadian oil shale, based on the current status of energy and the characteristics of oil shale. The system involves three subsystems: retort subsystem, where coarse oil shale (8–80 mm) is retorted to shale oil, hydrocarbon gases and oil shale semicoke; combustion subsystem, where the mixture fuel of oil-shale semicoke and fine oil shale (0–8 mm) is fed to a circulating fluidized bed (CFB) furnace to burn, in order to generate high-pressure steam which is used to supply heat and generate electricity via a traditional steam-electric power mode; and ash processing subsystem, where oil shale ash from the CFB furnace is utilized to produce building materials. A comprehensive utilization system with handling capacity of 2.6×10⁶ t/a Huadian oil shale is economically analyzed, showing that it can advantage oil shale utilization in the economic efficiency and the product type.     

Analysis of oil export dependency of MENA countries: Drivers,trends and prospects

The purpose of this paper is to analyse how oil export dependencies of Middle East and North African (MENA) oil producers have evolved over the past two decades and to identify the main driving factors from an energy policy perspective. The paper expresses the oil export dependency of each economy in terms of a multiplicative identity that captures effective export price, export to primary oil supply ratio, oil dependency and oil export intensity of the country. Using the data for 1980–2006, the evolution in these factors is investigated for seven MENA countries and the influence of the above factors is decomposed using the Laspeyres index. The analysis shows that energy price and increasing energy intensity in the MENA countries have influenced the overall oil export dependency. Reducing the energy intensity can improve oil export revenue share to GDP by 5–10% in most of the countries while Iran can gain significantly by increasing its export volume.     

China's oil reserve forecast and analysis based on peak oil models

In order to forecast future oil production it is necessary to know the size of the reserves and use models. In this article, we use the typical Peak Oil models, the Hu–Chen–Zhang model usually called HCZ model and the Hubbert model, which have been used commonly for forecasting in China and the world, to forecast China's oil Ultimate Recovery (URR). The former appears to give more realistic results based on an URR for China of 15.64 billion tons. The study leads to some suggestions for new policies to meet the unfolding energy situation.     

Economics of oil regulation and the Brazilian reform: Some issues

This paper reviews the economic fundamentals for regulation in the oil industry, with a focus on the current regulatory proposal for the Brazilian oil industry. The observed exploration and production (E&P) contracts foresee much of the characteristics of the optimal contract, with a remuneration structure that combines upfront with future payments to mitigate uncertainty and incentivize exploratory efforts. In Brazil, despite slow market deconcentration since 1997’s liberalization, the current oil regulation is in general consistent with an optimal regulatory response. From an economic standpoint, the 2009’s new regulatory proposal prompted by the major oil discoveries offshore in Brazil reduces the power of incentive schemes with respect to exploratory and cost-reducing efforts while the changes in the net risk of the E&P offshore activities are not so clear.     

Import demand of crude oil and economic growth: Evidence from India

This study establishes a long-run equilibrium relationship among quantity of crude oil import, income and price of the imported crude in India for the time span 1970–1971 to 2005–2006 using autoregressive distributed lag (ARDL) bounds testing approach of cointegration. Empirical results show that the long-term income elasticity of imported crude in India is 1.97 and there exists a unidirectional long-run causality running from economic growth to crude oil import. So reduction of crude oil import will not affect the future economic growth in India in the long-run. India should take various energy efficiency and demand side management measures in transport sector along with other measures like expanding and strengthening indigenous resource-base, substituting imported fuels by domestic fuels and de-controlling the price of petroleum products to reduce its import dependence.     

An overview of energy consumption of the globalized world economy

For the globalized world economy with intensive international trade, an overview of energy consumption is presented by an embodied energy analysis to track both direct and indirect energy uses based on a systems input–output simulation. In 2004, the total amounts of energy embodied in household consumption, government consumption, and investment are 7749, 874, and 2009 Mtoe (million tons of oil equivalent), respectively. The United States is shown as the world’s biggest embodied energy importer (683 Mtoe) and embodied energy surplus receiver (290 Mtoe), in contrast to China as the biggest exporter (662 Mtoe) and deficit receiver (274 Mtoe). Energy embodied in consumption per capita varies from 0.05 (Uganda) to 19.54 toe (Rest of North America). Based on a forecast for 2005–2035, China is to replace the United States as the world’s leading embodied energy consumer in 2027, when its per capita energy consumption will be one quarter of that of the United States.     

Interactions and kinetic analysis of oil shale semi-coke with cornstalk during co-combustion

The combustion experiments of oil shale semi-coke from Wang Qing retorts, cornstalk as well as their mixture were conducted under different heating rates using the thermogravimetric analyzer. The results showed that the advance ignition and burnout can be achieved when semi-coke was mixed with cornstalk. Derivative thermogravimetric curve of the experiment was compared with that of the calculated. The values of interaction index were solved. The interaction of mixture in the combustion process occurred mainly in 400–600 °C. It can be explained that the combustion of fixed carbon in cornstalk was delayed. The kinetics of combustion was studied for samples. The activation enthalpy, activation entropy and free energy of activation were analyzed by Kissinger–Akahira–Sunose equation and distributed activation energy model based on Eyring rate constant. The free energy of activation decreased with the addition of cornstalk proportion in the mixture. The results showed the feasibility using Johnson–Mehl–Avrami equation to simulate thermogravimetric curve. The representation of free energy of activation simulated agrees with that solved by Kissinger–Akahira–Sunose equation.     

The role of market fundamentals and speculation in recent price changes for crude oil

I hypothesize that the price spike and collapse of 2007–2008 are driven by both changes in both market fundamentals and speculative pressures. Contrary to arguments for a demand shock, I hypothesize that prices rise sharply in 2007–2008 because ongoing growth in Chinese oil demand runs into a sudden and unexpected halt to a decade long increase in non-OPEC production. This caused a loss of OPEC spare capacity because increased demand for OPEC production runs ahead of increases in OPEC capacity. These changes are reinforced by speculative expectations. Although difficult to measure directly, I argue for the role of speculation based on the following: (1) a significant increase in private US crude oil inventories since 2004; (2) repeated and extended break-downs (starting in 2004) in the cointegrating relationship between spot and far month future prices that are inconsistent with the law of one price and arbitrage opportunities; and (3) statistical and predictive failures by an econometric model of oil prices that is based on market fundamentals. These changes are related to the behavior and impact of noise traders on asset prices to sketch mechanisms by which speculative expectations can affect crude oil prices.     

A crash programme scenario for the Canadian oil sands industry

The report Peaking of World Oil Production: Impacts, Mitigation and Risk Management, by Robert L. Hirsch et al., concludes that Peak Oil is going to happen and that worldwide large-scale mitigation efforts are necessary to avoid its possible devastating effects for the world economy. These efforts include accelerated production, referred to as crash programme production, from Canada's oil sands. The objective of this article is to investigate and analyse what production levels that might be reasonable to expect from a crash programme for the Canadian oil sands industry, within the time frame 2006–2018 and 2006–2050. The implementation of a crash programme for the Canadian oil sands industry is associated with serious difficulties. There is not a large enough supply of natural gas to support a future Canadian oil sands industry with today's dependence on natural gas. It is possible to use bitumen as fuel and for upgrading, although it seems to be incompatible with Canada's obligations under the Kyoto treaty. For practical long-term high production, Canada must construct nuclear facilities to generate energy for the in situ projects. Even in a very optimistic scenario Canada's oil sands will not prevent Peak Oil. A short-term crash programme from the Canadian oil sands industry achieves about 3.6 mb/d by 2018. A long-term crash programme results in a production of approximately 5 mb/d by 2030.     

Greenhouse gas reduction in oil sands upgrading and extraction operations with thermochemical hydrogen production

This paper examines various methods of reducing CO₂ emissions by a thermochemical copper–chlorine (Cu–Cl) cycle of hydrogen production, for in-situ extraction and upgrading of bitumen to synthetic crude oil in Alberta’s oil sands. Particular focus is given to Canada’s SCWR (Supercritical Water-cooled Reactor) as a nuclear heat source for the Cu–Cl cycle, although other heat sources such as solar or industrial waste heat can be utilized. The feasibility of steam generation from supercritical water of a SCWR power plant is examined for bitumen extraction, as well as hydrogen production for bitumen upgrading via an integrated Cu–Cl cycle with SCWR. The heat requirements for bitumen extraction from the oil sands, and the hydrogen requirements for bitumen upgrading, are examined. A new layout of oil sands upgrading operations with integrated SCWR and a Cu–Cl cycle is presented. The reduction of CO₂ emissions due to the integrated SCWR and Cu–Cl cycle is quantitatively investigated based on the expected bitumen production capacity over the next two decades.     

Global oil depletion: A review of the evidence

Within the polarised and contentious debate over future oil supply a growing number of commentators are forecasting a near term peak and subsequent decline in production. But although liquid fuels form the foundation of modern industrial economies, the growing debate on ‘peak oil’ has relatively little influence on energy and climate policy. With this in mind, the UK Energy Research Centre (UKERC) has conducted an independent, thorough and systematic review of the evidence, with the aim of establishing the current state of knowledge, identifying key uncertainties and improving consensus. The study focuses upon the physical depletion of conventional oil in the period to 2030 and includes an in-depth literature review, analysis of industry databases and a detailed comparison of global supply forecasts. This Communication summarises the main findings of the UKERC study. A key conclusion is that a peak of conventional oil production before 2030 appears likely and there is a significant risk of a peak before 2020.     

A variant of the Hubbert curve for world oil production forecasts

In recent years, the economic and political aspects of energy problems have prompted many researchers and analysts to focus their attention on the Hubbert Peak Theory with the aim of forecasting future trends in world oil production.In this paper, a model that attempts to contribute in this regard is presented; it is based on a variant of the well-known Hubbert curve. In addition, the sum of multiple-Hubbert curves (two cycles) is used to provide a better fit for the historical data on oil production (crude and natural gas liquid (NGL)).Taking into consideration three possible scenarios for oil reserves, this approach allowed us to forecast when peak oil production, referring to crude oil and NGL, should occur.In particular, by assuming a range of 2250–3000 gigabarrels (Gb) for ultimately recoverable conventional oil, our predictions foresee a peak between 2009 and 2021 at 29.3–32.1 Gb/year.     

An analysis of future building energy use in subtropical Hong Kong

Principal component analysis of prevailing weather conditions in subtropical Hong Kong was conducted, and a new climatic index Z (as a function of the dry-bulb temperature, wet-bulb temperature and global solar radiation) determined for past (1979–2008, measurements made at local meteorological station) and future (2009–2100, predictions from general circulation models) years. Multi-year (1979–2008) building energy simulations were carried out for a generic office building. It was found that Z exhibited monthly and seasonal variations similar to the simulated cooling/heating loads and building energy use. Regression models were developed to correlate the simulated monthly building cooling loads and total energy use with the corresponding Z. Error analysis indicated that annual building energy use from the regression models were very close to the simulated values; the difference was about 1%. Difference in individual monthly cooling load and energy use, however, could be up to 4%. It was also found that both the DOE-simulated results during 1979–2008 and the regression-predicted data during 2009–2100 indicated an increasing trend in annual cooling load and energy use and a gradual reduction in the already insignificant heating requirement in cooling-dominated office buildings in subtropical climates.     

Evaluating the effectiveness of urban energy conservation and GHG mitigation measures: The case of Xiamen city,China

To assess the effectiveness of urban energy conservation and GHG mitigation measures, a detailed Long-range Energy Alternatives Planning (LEAP) model is developed and applied to analyze the future trends of energy demand and GHG emissions in Xiamen city. Two scenarios have been designed to describe the future energy strategies in relation to the development of Xiamen city. The ‘Business as Usual’ scenario assumes that the government will do nothing to influence the long-term trends of urban energy demand. An ‘Integrated’ scenario, on the other hand, is generated to assess the cumulative impact of a series of available reduction measures: clean energy substitution, industrial energy conservation, combined heat and power generation, energy conservation in building, motor vehicle control, and new and renewable energy development and utilization. The reduction potentials in energy consumption and GHG emissions are estimated for a time span of 2007–2020 under these different scenarios. The calculation results in Xiamen show that the clean energy substitution measure is the most effective in terms of energy saving and GHG emissions mitigation, while the industrial sector has the largest abatement potential.     

Limits to international diversification in oil & gas – Domestic vs foreign asset control

We provide evidence that international diversification in the oil and gas sector comes at an important cost; lower control over foreign oilfield assets (and therefore reduced control over oilfield cash-flows). This work examines the factors that drive companies to diversify despite the loss of control over oilfields. Detailed worldwide data for 293 companies owning 6633 field stakes enable us to demonstrate that diversification increases with firm size but results in lower asset control – with an important caveat – companies seek to retain minimum control blockholdings in ‘foreign oilfield assets’. We conclude, therefore, that companies seeking reserve replacement are forced to diversify but need to accept lower control over foreign asset cash-flows.     

Security concerns in the Middle East for oil supply: Problems and solutions

Comprising 65–70% of the world's oil reserves, the Gulf States (Saudi Arabia, Iran, Iraq, Kuwait, UAE and Qatar) are key countries for the solutions to the energy supply matters of the world. Free flow of oil to the world markets from Gulf region is an indispensable part of the major security issues. The Middle East has had mainly security related problems such as Arab–Israeli wars and conflicts, Arab–Iranian war and conflicts, Arab–Arab war and conflicts, US–Gulf wars and conflicts and more recently radicalism and terrorist attacks. Energy supply security requires the enhancement of the peace and cooperation between countries instead of competition. Preventive policy approaches are more suitable to address energy supply matters. Preventive strategy might be possible with the active participation of NATO within the “out of area” type operations to the Middle East and quite possibly indirectly to the Asia-Pacific regions. Religious and ethnic radicalism and terrorist attacks has also direct effects over oil supply security matters.     

Worldwide cheap and heavy oil productions: A long-term energy model

Crude oil, natural gas liquids, heavy oils, deepwater oils, and polar oils are non-renewable energy resources with increasing extraction costs. Two major definitions emerge: regular or ‘cheap’ oil and non-conventional or ‘heavy’ oil. Peaking time in conventional oil production has been a recent focus of debate. For two decades, non-conventional oils have been mixed with regular crude oil. Peaking time estimation and the rate at which production may be expected to decline, following the peak, are more difficult to determine. We propose a two-wave model for world oil production pattern and forecasting, based on the diffusion of innovation theories: a sequential multi-Bass model. Historical well-known shocks are confirmed, and new peaking times for crude oil and mixed oil are determined with corresponding depletion rates. In the final section, possible ties between the dynamics of oil extraction and refining capacities are discussed as a predictive symptom of an imminent mixed oil peak in 2016.