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www.eia.govU.S. Energy Information Administration Independent Statistics & Analysis

World and U.S. Oil and Gas Production and Price Outlook: To Infinity (or at least 2050) and Beyond

Energy and Environment Symposium April 18, 2018 | Rifle, Colorado

by Troy Cook, Senior Global Upstream Analyst, EIA

Show of hands…who here uses EIA data?

Troy Cook, Energy and Environment Symposium, Rifle Colorado April 18, 2018 2

EIA is all about energy data and energy analysis• Data (Statistics)

– Data collection (surveys)

– Data synthesis, curating, presentation (e.g., Excel add-in)

• Analysis– Present and near history

• Disruption analysis

• Drilling productivity report

– Near-term forecasts: STEO

– Longer-term projections

• Annual Energy Outlook (AEO)

• International Energy Outlook (IEO)


www.eia.gov

The Annual Energy Outlook 2018 (AEO2018) represents a projection of the U.S. energy system to the year 2050

• Projection, not forecast

• Conceptually, represents peak (mode) of conditional probability distribution– No information about shape of distribution is given

– Conditions include existing technologies (largely), current laws and regulations

• Infinitesimally small chance of being “right”– We’ve never been right in the past

– No one has…


EIA has never correctly predicted the crude oil price


Average imported crude oil acquisition pricenominal dollars per barrel

Source: EIA, Annual Energy Outlooks through 2018

Global outlook

6Troy Cook, Energy and Environment Symposium, Rifle Colorado April 18, 2018

• The effects of assumptions about economic growth on energy consumption are addressed in the High and Low Economic Growth cases. World gross domestic product increases by 3.3%/year from 2015 to 2040 in the High Economic Growth case and by 2.7%/year in the Low Economic Growth case, compared with 3.0%/year in the Reference case

• The High and Low Oil Price cases address the uncertainty associated with the trajectory of world energy prices. In the Low Oil Price case, the price of North Sea Brent crude in 2016 dollars reaches $43/barrel by 2040, compared with $109/barrel in the Reference case and $226/barrel in the High Oil Price case

• Although the graphics in this presentation focus on projections through 2040, this IEO is the first projection to include model results through 2050, which are available on the IEO page of the EIA website; EIA welcomes feedback on the assumptions and results over the period of 2040–50

Troy Cook, Energy and Environment Symposium, Rifle Colorado April 18, 2018

IEO2017 addresses the uncertainty inherent in energy projections by developing side cases focusing on overall energy consumption

7

0255075

100125150175200225250

2015 2020 2025 2030 2035 2040

High Oil Price case

Reference case

Low Oil Price case0

200

400

600

800

1,000

Ref RefOil Price

Case

Low High

Liquids

Other

RefOil Price

Case

Low High

World oil prices in three casesreal 2016 dollars per barrel

World energy consumption in three casesquadrillion Btu

Source: EIA, International Energy Outlook 2017

Future oil prices are another key source of uncertainty in the projections


2015 2030 2040

1.7

0.2

1.4

1.5

2.0

2.1

2.3

2.6

0 1 2 3 4 5 6

Total OECD

Japan

OECD Europe

Canada

South Korea

United States

Mexico/Chile

Australia/New Zealand

3.81.41.6

2.42.6

3.03.93.9

4.35.0

0 1 2 3 4 5 6

Total Non-OECD

Russia

Brazil

Other Europe/Eurasia

Other Americas

Middle East

Africa

Other Asia

China

India

Average annual percent change in real GDP by region, 2015-40

Source: EIA and Oxford Economic Model (March 2017)

Economic growth—a major driver of energy demand—is greater on average in non-OECD countries


OECD Non-OECD

0

50

100

150

200

250

1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040

Petroleum and other liquids

Natural gas

Coal

RenewablesNuclear



Energy consumption increases over the projection for all fuels other than coal in the Reference case with renewables being the fastest-growing energy sourceWorld energy consumption by energy sourcequadrillion Btu

10

OutlookPast trend



Although population and per capita output continue to rise, energy and carbon intensity are projected to continue to fall in the Reference case

11

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

1990 2015 20400

10

20

30

40

50

60

1990 2015 20400123456789

10

1990 2015 20400

10

20

30

40

50

60

70

1990 2015 2040

Populationmillion people

Per capita grossdomestic productthousand dollars

Carbon intensitymetric tons CO2 per billion Btu

Energy intensitythousand Btu per dollar

Non-OECD

OECD

0

10

20

30

40

50

60

70

2000 2005 2010 2015 2020 2025 2030 2035 2040

Non-OPEC crude and lease condensate

OPEC crude and lease condensate

Other liquids


Liquid fuel supplies increase from 2015 to 2040 with most of the growth occurring in OPEC crude oil and lease condensate

World petroleum and other liquids productionmillion barrels per day 12

48

44

21

47

34

16

Past trend Outlook

0

20

40

60

80

100

120

1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040

OECD

Non-OECD


World natural gas consumption increases by 43% from 2015 to 2040 in the Reference case largely due to demand growth

World natural gas consumptiontrillion cubic feet 13

Past trend Outlook


Middle East, the United States, and China account for more than 60% of the world increase in natural gas production

Increase in natural gas production, 2015-40trillion cubic feet 14

0 2 4 6 8 10 12 14

Non-OECD Americas

Canada

Other non-OECD Asia

Africa

Australia and New Zealand

Russia

China

United States

Middle East

0

10

20

30

40

2015 2030 2040 2015 2030 2040 2015 2030 2040


Shale gas and tight gas become increasingly important to gas supplies, not only for the United States, but also for China and Canada

Natural gas productiontrillion cubic feet 15

ChinaCanada

Shale gas

Other

United States

Coalbed methaneTight gas

Domestic Overview


2010 2020 2030 2040 2050

2017projections

High Oil and Gas Resource and Technology

0

5

10

15

20

25

2010 2020 2030 2040 2050

Low Oil and Gas Resource and Technology

2017projections

0

5

10

15

20

25

2000 2010 2020 2030 2040 2050

tight oil

2017history projections

Reference case

other

Crude oil production million barrels per day

Tight oil production remains the leading source of U.S. crude oil production from 2017 – 2050


0.00.51.01.52.02.53.03.54.04.5

2000 2010 2020 2030 2040 2050


Southwest

Dakotas/Rocky Mountains

Gulf CoastMidcontinentWest CoastEast

Lower 48 onshore crude oil production by region (Reference case) million barrels per day

The Southwest region leads growth in tight oil production in the Reference case


-60

-40

-20

0

20

40

60

80

2000 2010 2020 2030 2040 2050


Low Oil PriceLow Oil and GasResource and Technology

Reference

High Oil Price

High Oil and GasResource and Technology

net imports

net exports

Petroleum net imports as a percentage of product suppliedpercent

In the Reference case, the United States becomes a small net exporter of petroleum on a volume basis from 2029 to 2045


0

20

40

60

80

100

120

140

160

0

10

20

30

40

50

60

2010 2020 2030 2040 2050

2017projections

High Oil and Gas Resourceand Technology

Natural gas production by type trillion cubic feet billion cubic feet per day

Increased U.S. natural gas production is the result of continued development of shale gas and tight oil plays


0

10

20

30

40

50

60

2000 2010 2020 2030 2040 2050


Reference

shale gas and tight oil plays

tight gasother Lower 48 onshoreLower 48 offshoreOther (Alaska and coalbed methane)

0

20

40

60

80

100

120

05

1015202530354045

2010 2020 2030 2040 2050

2017projections

Shale gas production by regiontrillion cubic feet billion cubic feet per day

Plays in the East lead production of U.S. natural gas from shale resources in the Reference case

21

High Oil and GasResource andTechnology


05

1015202530354045

2000 2010 2020 2030 2040 2050


East

Gulf Coast

rest of U.S.

Reference

020406080100120140160

0

10

20

30

40

50

60

2000 2010 2020 2030 2040 2050


High Oil and Gas Resource and TechnologyHigh Oil PriceHigh Economic GrowthReferenceLow EconomicGrowthLow Oil PriceLow Oil and Gas Resource and Technology 0

20

40

60

80

100

120

140

160

0

10

20

30

40

50

60

2000 2010 2020 2030 2040 2050


Natural gas productiontrillion cubic feet billion cubic feet per day

Natural gas consumptiontrillion cubic feet billion cubic feet per day

U.S. natural gas consumption and production increase in most cases with production growth outpacing natural gas consumption in all cases


0

10

20

30

40

50

60

2000 2010 2020 2030 2040 2050



High Oil and Gas Resource and Technology

ReferenceAEO 2017Reference

0

2

4

6

8

10

12

2000 2010 2020 2030 2040 2050



ReferenceHigh Oil and Gas Resource and Technology

AEO 2017 Reference

Dry natural gas productiontrillion cubic feet

Natural gas spot price at Henry Hub 2016 dollars per million British thermal units

Natural gas prices across cases are dependent on resource and technology assumptions


-14

-7

0

7

14

21

28

-5

0

5

10

2000 2010 2020 2030 2040 2050


liquefied natural gas (LNG) exportspipeline exports to

CanadaMexico

pipeline imports fromCanada

LNG imports

Natural gas tradetrillion cubic feet billion cubic feet per day

The United States is a net natural gas exporter in the Reference case because of continued export growth and import decline


0

1

2

3

4

5

6

7

8

2004 2006 2008 2010 2012 2014 2016 2018

Eagle Ford (TX)Bakken (MT & ND)Spraberry (TX & NM Permian)Bonespring (TX & NM Permian)Wolfcamp (TX & NM Permian)Delaware (TX & NM Permian)Yeso-Glorieta (TX & NM Permian)Niobrara-Codell (CO, WY)Haynesville (LA, TX)Utica (OH, PA & WV)Marcellus (PA,WV,OH & NY)Woodford (OK)Granite Wash (OK & TX)Austin Chalk (LA & TX)Monterey (CA)

U.S. tight oil productionmillion barrels of oil per day

U.S. dry shale gas productionbillion cubic feet per day

The U.S. has experienced a rapid increase in natural gas and oil production from shale and other tight resources

Sources: EIA derived from state administrative data collected by DrillingInfo Inc. Data are through February 2018 and represent EIA’s official tight oil & shale gas estimates, but are not survey data. State abbreviations indicate primary state(s). Note: Scales are presented at approximate barrel of oil equivalent.

25

0510152025303540455055

2004 2006 2008 2010 2012 2014 2016 2018

Marcellus (PA, WV, OH & NY)Utica (OH, PA & WV)Permian (TX & NM)Haynesville (LA & TX)Eagle Ford (TX)Fayetteville (AR)Barnett (TX)Woodford (OK)Bakken (ND & MT)Antrim (MI, IN & OH)Rest of US 'shale'


EIA Products and informationU.S. Energy Information Administration home page | www.eia.gov

Annual Energy Outlook | www.eia.gov/forecasts/aeo

Short-Term Energy Outlook | www.eia.gov/forecasts/steo

International Energy Outlook | www.eia.gov/forecasts/ieo

Today In Energy | www.eia.gov/todayinenergy

Monthly Energy Review | www.eia.gov/totalenergy/data/monthly

State Energy Portal | www.eia.gov/state


http://www.eia.gov/

http://www.eia.gov/forecasts/aeo

http://www.eia.gov/forecasts/steo

http://www.eia.gov/forecasts/ieo

http://www.eia.gov/todayinenergy

http://www.eia.gov/totalenergy/data/monthly

http://www.eia.gov/state

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