Download - ………… IN THE REAL WORLD
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AMERICAN OIL ENERGY
INDEPENDENCE
………… IN THE REAL WORLD
Dr. John Anthony Scire, PhD, 6 February 2013
THE OPTIMISTS PREDICT US WILL BE INDEPENDENT OF
OUR RELIANCE ON IMPORTED OIL IN TEN YEARS
(IF WE OPEN UP ALL OF OUR FEDERAL LANDS FOR DRILLING, INCREASE FRACKING, AND BEGIN TO EXPLOIT THE OIL SHALES IN THE GREEN RIVER FORMATION.)
SO PEAK OIL IS A THING
OF THE PAST????
REALLY?
A REALITY CHECK
ON PEAK OIL
PRODUCTION
THE WORLD PEAKOF OIL
PRODUCTION IS NOW
ESTIMATED TO BE BEYOND
2040 ….. BUT
WHO CARES ??
THE US WILL NOT EXCEED
ITS 1970 PEAK FOR THE FORESEEABLE
FUTURE
THE ENERGY INFORMATION AGENCY OF THE US DOE PREDICTS U.S. tight oil production leads a growth in
domestic production of 2.6 million barrels per day between 2008 and 2019
U.S. crude oil production million barrels per day
Source: EIA, Annual Energy Outlook 2013 Early Release
9 Adam Sieminski January 5, 2013
Tight oil
Alaska
Other lower 48 onshore
Lower 48 offshore
ProjectionsHistory 2011
BP says US still imports 35% in 2030
DOE says US still imports 37% in 2040
IEA says US still imports 16% by 2035 - (but all of it from the Western Hemisphere, mostly from
Canada)
A REALITY CHECK ON IMPORTS
AND WE WILL STILL IMPORT UP TO 37% OF OUR LIQUID FUELS in
2040
Source: EIA, Annual Energy Outlook 2013 Early Release
BUT HOW IMPORTANT
IS OIL TO OUR ECONOMY???
PETROLEUM IS ONLY 35.28% OF TOTAL ENERGY CONSUMPTION BUT IN EXCESS OF 90% OF
TRANSPORTATION’S ENERGY USE
HOW IMPORTANT IS OIL TO THE AMERICAN ECONOMY?
BUT THEFRACKING GAS WILL SAVE US!!!
SHALE GAS DOUBLES GASPRODUCTION BY 2040
U.S. dry natural gas production in trillions of cubic feet
Source: EIA, Annual Energy Outlook 2013 Early Release
Associated with oilCoalbed methane
Tight gas
Shale gas
Alaska
Non-associated onshore
Non-associated offshore
ProjectionsHistory 2011
BUT CONSUMPTION
IS GOING UP AND LNG
EXPORTS WILL GO UP SOON
1995 2000 2005 2010 2015 2020 2025 2030 2035 20400.0
0.5
1.0
1.5
2.0
2.5
3.0
NATURAL GAS CONSUMPTIONBY TRANSPORTATION
QUADRILLION BTUs
Note: Gas to liquids includes heat, power, and losses.Source: EIA, Annual Energy Outlook 2013 Early Release
Pipeline fuel
Light-duty vehicles
2011History Projections
95%
3%
1%
1%
28%
38%
3%
31%
1%Buses
Freight trucks
Gas to liquids
In 2005, 2,085 gigawatt hours per day
In 2012 , 3,358 gigawatt hours per day
This is a growth in Electricity Generation Use
of 47%IN JUST 7 YEARS
NATURAL GAS CONSUMPTION BY ELECTRICITY GENERATION
NATURAL GAS CONSUMPTION BYEXPORTATION
U.S. natural gas exportstrillion cubic feet
Source: EIA, Annual Energy Outlook 2013 Early Release
19
Alaska LNG exports
Exports to Mexico
Exports to Canada
Lower 48 LNG exports
AND THEN PRICES GO UP
TO WORLD MARKET PRICES WHICH ARE 5
TO 9 TIMES HIGHER THAN
THE US
NATURAL GAS WILL NOT MAKE
US ENERGY INDEPENDENT
BUT IT WILL ……
CONCLUSION:
TIME TO REDUCE OIL
ENERGY CONSUMPTION BY
INCREASING EFFICIENCY AND ALTERNATIVES
....BUY US TIME….
BECAUSE EVEN THOUGH OUR DOMESTIC CONSUMPTION HAS
DECLINED AND WILL CONTINUE TO DECLINE
WORLD DEMAND FOR OIL WILL GO FROM 85 MBD TODAY TO OVER 103 MBD BY 2030
96% OF THAT GROWTH WILL BE FROM NON-OECD COUNTRIES.
WORLD DEMAND WILL INCREASE
DRAMATICALLY
1. OPEC’S SHARE OF PRODUCTION GOES UP TO 45% (BP/IEA)
2. US WILL HAVE TO PAY WORLD PRICES …………AND………….
3. NET IMPORT BILLS WILL NOT GO DOWN (OPEC will still have pricing power)
SOOOOOOOOOO
AND WORLD PRICES WILL NOT DECLINE
NO TOTAL INDEPENDENC
E BUT
THE GOOD NEWS IS…….
NO NEED TO IMPORT ANY
OIL FROM THE MIDEAST
BY 2020
SO LET’SDISCUSS
THE NATIONAL SECURITY
POSSIBILITIS
- CENTCOM ROLE DIMINISHES VIS-À-VIS THE OTHER COMS
- ISRAEL’S IMPORTANCE DIMINISHES
- IRAN’S IMPORTANCE DIMINISHES
- THE TRADE DEFICIT’S DRAIN ON AMERICAN CAPITAL DIMINISHES
MORE SECURITY POSSIBILITIES
- OIL DISRPUTIONS WORLDWIDE DUE TO DEMAND OR SUPPLY PROBLEMS WILL NOT CRUSH THE US ECONOMY
- MORE SELECTIVITY IN SOURCING OIL WHEN SECURITY IMPLICATIONS ARISE
- RISING IMPORTANCE OF WESTERN HEMISPHERE
- COMPETION WITH CHINA FOR RESOURCES MAY ESCALATE
MORE SECURITY CONSIDERATIONS
- CHINA’S DEPENDENCY RISES TO 80% MOST OF WHICH WILL COME FROM THE MIDDLE EAST AND AFRICA
- EURO DEPENDENCE ON RUSSIAN GAS DIMINISHES AS US LNG EXPORTS INCREASE
- JAPANESE DEPENDENCE ON IMPORTED LNG INCREASES AS NUCLEAR DECLINES
