Forecast of Rising Oil Demand Challenges Tired Saudi Fields (nyt)

[meow mix]

http://www.nytimes.com/2004/02/24/business/24OIL.html?pagewanted=1

was on CNN headline news this morning too..

Saudi Arabia, the leading exporter for three decades, is not running out of oil. Industry officials are finding, however, that it is becoming more difficult or expensive to extract it. Today, the country produces about eight million barrels a day, roughly one-tenth of the world's needs. It is the top foreign supplier to the United States, the world's leading energy consumer.
***
The most significant is Ghawar. Discovered in 1948, the 300-mile-long sliver near the Persian Gulf is the world's largest oil field and accounts for more than half of the kingdom's production.
***
Ghawar is still far too productive to abandon. But because of increasing problems with managing the water, one Saudi oil executive said, "Ghawar is becoming very costly to maintain."
***
"The big risk in Saudi Arabia is that Ghawar's rate of decline increases to an alarming point," said Ali Morteza Samsam Bakhtiari, a senior official with the National Iranian Oil Company. "That will set bells ringing all over the oil world because Ghawar underpins Saudi output and Saudi undergirds worldwide production."

[amandabeech]

1. The Center for Strategic & International Studies

held a conference on this topic on Tuesday, Feb. 24, in D.C. Two representatives from SaudiAramco were present, as well as Matthew Simmons, an investment banker from Houston who specializes in energy investments. Simmons is at least acquainted with Cheney, and participated in the energy task force. He seems to agree that oil and then natural gas will run short sooner rather than later, and shares the viewpoint of Price that Saudi fields will not be able to increase production much beyond the 10,000,0000-odd barrels per day that they now pump, at least without damaging the fields to the point that less oil will inevitably be pumped from them. Sometimes I wonder if some of the information that Cheney will not divulge concerns very serious and alarming discussion about oil and gas depletion.

I personally think that oil will be in short supply by 2020 and will be extremely pricey, but this is not a popular position in the general populace. While I applaud the NYT for publishing stores like this that discuss some aspects of the oil depletion problem, I find that they frequently do not put the quantities of oil being pumped from Saudi Arabia, Iraq, Alaska, etc. in perspective. For example, the United States now uses approximately 20,000,000 barrels of oil per day, double Saudi production. The world is now consuming approximate 80,000,000 barrels per day, of which the Saudis are providing 12.5%. Estimates vary on the amount of oil the world is expected to consume (if it is available) by 2020, but I've seen estimates of at least 120,000,000 per day. Even if the Saudis can get their production up to 19-20,000,000 barrels per day, it still won't be enough, particularly since production is declining in just about all other oil provinces, and no one has suggested where all this new oil might be found.

For more on the conference,

http://csis.org

Simmons' presentation: http://www.csis.org/energy/040224_simmons.pdf

For more of Matthew Simmons, see Simmons & Company International

http://simmonsco-intl.com

[meow mix]

2. oil up to 37.38 today..

nice jump
http://www.bloomberg.com/energy/

[jmcgowanjm]

3. I see $35.56 meow mix for NYMEX Light

[meow mix]

6. its up again today, 36.15 - its been ratcheting..

the WTI Cushing is the one most usually referred to by news sources.
for whatever reason..
i dunno why =)

[jmcgowanjm]

9. Cushing OK where physical delivery takes place

must have been adding freight charges.

http://www.nymex.com/jsp/markets/lsco_otc_wtimdes.jsp

Thanx for the clarification, meow mix. I'm going out
to fill up my truck before the (latest) price rise gets here.
Talk to you later.

[jmcgowanjm]

4. Hello Amanda. 68MBOE/y for 2003/ OPEC est 78.9 for 04

The 68 MBOE/y figure is from ASPO/Campbell or
Deffeyes I think.

You wrote-The world is now consuming approximate 80,000,000 barrels per day.

Could you confirm/source your numbers? The reason
is that I think these are the most critical figures
for judging Peak. Deffeyes sees us bumping the ceiling now.

they frequently do not put the quantities of oil being pumped from Saudi Arabia, Iraq, Alaska, etc. in perspective.

There's a reason for this.

Love your posts, thanx for the links,
James

[Viking12]

5. The DOE's

Energy Information administration has pretty reliable info on world petroleum:

http://www.eia.doe.gov/emeu/international/petroleu.html#IntlConsumption


I think this is what you're looking for:

http://www.eia.doe.gov/emeu/ipsr/t24.xls

2002 Total world demand = 77.55 mb/d
2003 Yearly average is not yet available but the first three quarters are: 1st = 79.67 mp/d, 2nd = 77.14 mb/d, 3rd = 78.40 mb/d

[jmcgowanjm]

7. Serious discrepancies here

The actual amount of oil production was another area
marred by discrepancies and crucial since this figure
provides the central bank a way to determine taxes due.

http://www.hrw.org/reports/2004/angola0104/4.htm

This from argueably the US #1 source of new oil
increase import.

The EIA/DOE and the USGS can't agree and have not
backdated proven reserve revisions.
Laherrere, Deffeyes, and Campbell do not trust the
above entities.

And the EIA gets input from the Oil and Gas Journal
which, according to CSMonitor stated
Total world oil production reached 68 million barrels per
day in 2003, according to a count by the Oil and Gas
Journal. That's not much above the 66.7 million barrels per
day. in 2001. Oil reserves estimated at 1.266 trillion are up
only a bit from 1.213 trillion a year earlier (again,
no backdating here).

http://www.csmonitor.com/2004/0129/p14s01-wogi.html

More and more (there's gotta be a Theorem here) it's in the
interest of Powers to obfuscate. I expect areas of US to
run out of gasoline/NG soon/this summer. Then we'll see.

http://mwhodges.home.att.net/energy/energy-b.htm

[jmcgowanjm]

8. Edit: that's mboe/day/year equaling 25Gigabarrels/year

and 79.83 mboe/d estimate by OPEC for 2004

[amandabeech]

12. Hi James!

Sorry to be so late in responding. My new computer apparently does not include Excel in its program packages, so much search for the numbers you requested from IEA/DOE sites has been futile. I see, however, that others have posted.

I can get to the ASPO newsletter at <http://www.peakoil.net/newsletter/NL37/Newsletter37.html>
gives at least an approximate answer to your question.

If you scroll down the page, you will see a graph and a chart that is titled "estimated production table." The figures for 2005 show a total estimate of 78mil bpd. Of that, "regular oil" accounts for 60mil. bpd. Regular oil consists of that pumped below the polar regions from land-based and shallow off-shore wells.

Below that on the same table are figures for "non-regular oil" aggregating 24mil. bpd as follows: Heavy (including oil sands) 2.8;
Deep water-- 5.6; Polar -- 1.2; and Natural Gas Liquids -- 8.2.

I have read elsewhere, principally on the Yahoo group "Energyresources," that "Peak Oil" refers only to regular oil, which is the easy to get to stuff that delivers a lot of net energy. The non-regular oil is very hard to get at or to refine, and has low net energy, except for perhaps natural gas liquids. Real problems ensue when you run out of the high net energy, easy to get to stuff.

At least that's my take on it.

I hope that helps answer your questions.

Take care,

Amanda

[jmcgowanjm]

13. Yes, Amanda, regular oil could make up the 60+ mil figure

It's so easy to get lost in the stats. And different
types of hydrocarbonsEspecially if there is
lack of transparency or different measures-bbls, liters,
tonnes, TrillionCubicFeet are used to describe different fields, productivity, supply/demand.

Thanx for your help,
James

[meow mix]

10. hey look, war spoils are coming

UPDATE: Iraq Starts Oil Exports At Khor Al-Amaya

Earlier in the week, SOMO officials said the Khor Al-Amaya terminal will start loading at a rate of 300,00-400,000 barrels a day and gradually increase to 800, 000 b/d, although they gave no time frame. On Friday SOMO sources declined to give details about future scheduled loadings.

http://story.news.yahoo.com/news?tmpl=story&u=/dowjones/20040227/bs_dowjones/200402271334000792

wonder what effect this will have..
also noticed..

"OPEC will study output decision if high oil prices continue"
http://story.news.yahoo.com/news?tmpl=story&u=/afp/20040228/ts_afp/uae_opec_oil_040228192852

[jmcgowanjm]

11. I still think Kuwait is stealing from Rumallah

Exports from the Basra terminal are expected to be below January's 1.5 million b/d, due to weather-related delays, SOMO officials said this week.

Weather-related. Did they have a hurricane blow up
the Persian Gulf? A Siberian Blast?