Energy Geopolitics 2009

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Petroleum Production Engineering PROF. M. J. ECONOMIDES


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Petroleum Production Engineering PROF. M. J. ECONOMIDES

Energy

Geopolitics

Michael J.

Economides

Energy

Geopolitics

Michael J.Economides

2009


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Energy Geopolitics PROF. M. J. ECONOMIDES

The Continuous Energy CrisisThe Continuous Energy Crisis

of the 21st Centuryof the 21st Century

Oil almost $150, then fell to below $40headlines rule crisis

OPEC has little excess capacity behind

the valve, Venezuela, Nigeria, IraqIEA (Nov. 2008) 9.1% decline in oil production

China still grows in economy and energy

Saudi Arabia world regulator

Less than $40 to $100 by end 2009


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Natural GasNatural Gas

International demand destruction is

larger than was anticipatedBecause of LNG developments in Qatar,

Egypt and Sakhalin 2, there could be 10Bcf/d excess supply. Considerableimpact on gas prices in Europe and the

United States Cheniere LNG$4 gas for two to three years?

Devastating impact on US shale gas


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Oil Demand and Price

Abu GhraibYukosFaja


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7

73%

8%12%

7%

NOC reserves(equity access)

Full IOCaccess

Reserves held byRussiancompanies

NOC reserves(no equity access)

Today

1%

14%85%

Full IOCaccess

1960s

SOVIET

reserves

NOC reserves(no equity access)

IOC = International oil companyNOC = National oil company

World Oil and Gas ReservesDrift Toward Constrained IOC Access

World Oil and Gas ReservesDrift Toward Constrained IOC Access

Source: PFC Energy, Oil & Gas Journal, BP Statistical Review 2008Note: Excludes unconventional crude oil and bitumen reserves

Only 7% of the worlds reserves are fully accessible by IOCs


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8

Top 25 ReservesOil, NGL and Natural Gas


0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

Aramco

(Sau

di)

NIOC(Iran

)

INOC(Iraq

)

QP(Qa

tar)

Gazprom

(Russ

ia)

KPC(Kuwa

it)

PDV

(Venezue

la)

Adnoc

(Abu

Dha

bi)

NNPC(Nigeria

)

Sona

trac

h

(Algeria

)

Libya

NOC

CNPC(China)

Pe

tronas

(Ma

lays

ia)

Exxon

Mo

bil

Rosne

ft

(Russ

ia)

BP

Turkmengas

Lu

ko

il

Pemex

(Mex

ico

)

She

ll

Chevron

Pe

tro

bras

Conoco

Phillips

To

tal

Surgu

tne

ftegas

MMBOE

Source: Energy Intelligence Group, Ranking the Worlds Oil Companies 2008

Majors




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0.0

0.5

1.0

1.5

2.0

2.5

3.0

80 90 00 10 20 30

0

10

20

30

40

50

60

80 90 00 10 20 30

0

50

100

150

200

250

300

350

400

80 90 00 10 20 30

1.71.7

1.41.4

2.22.2

1.51.5

1.21.2

0.80.8

2.12.1 9.59.5

1.51.5

2.72.7

2.22.2

1.01.0

1.51.5

5.95.9

2.22.2

Total Energy Other Energy Wind & Solar

HydroHydro

NuclearNuclear

Biomass,MSW

Biomass,MSW

Wind & Solar

OilOil

GasGas

CoalCoal

OtherOther

Growth Rate2003-2030, %

SolarSolar

Wind

MBDOE MBDOE MBDOE

Growth Rate1980-2003, %

1.6 1.7

11.111.1

Oil & Gas Remain as Primary Energy Sources


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What Congress and theWhat Congress and the

President need is a CalculatorPresident need is a Calculator

Cardinal mine in Kentucky (35th-largest in

the U.S., producing about 15,350 tons ofcoal per day, 66,000 barrels of oil equivalent

All solar panels and wind mills

76,000 barrels of oil equivalent

The US total energy use

47,400,000 barrels of oil equivalent Solar and wind 0.2 to 0.4%

(Robert Bryce, 2009)


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Let me make a predictionLet me make a prediction

First do not choke on the

daringness

By the end of Pres. Obamas first

term

The US will use more oil

It will import a largerpercentage


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National Transportation

Energy Perspective

0

20

40

60

80

100

120

140

1950 1960 1970 1980 1990 2000 2010 2020

Quadrillion

BTU

Other

Conventional Hydroelectric Power

Nuclear Power

Coal

Natural Gas

Imported Oil

Oil Transportation

Oil Products

Imported Oil

Biofuels


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The New Energy Economy

Wood (1800s) Coal

Oil

Natural Gas

Hydrogen(envisioned)

Increasingly:

Clean

Energy intensive

Technologicallysophisticated

Distributed

Carboncontent:

High

Medium

Low

(Zero)


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````````


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Golfing for Hydrogen


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Bovine Brain Power > Mad Car Disease?


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The Ethanol Scam


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Wind Power Exposed: Expensive,

Unreliable and Wont Save Natural Gas

UK Ofgem: wind grossly distorting the market29.7% of cost for 1.3% of electric supplyLoad factor: 27.4%. Gas demand goes up


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There are no alternatives

to hydrocarbon energysources in the

foreseeable future


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Gwyneth Paltrow

Energy

Expert


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TIME, AUGUST 26, 2002


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EnergyGeopoliticsThe Axis of Energy Militants

IranVenezuela

Russia under Putin

The quagmire that is Iraq

China


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Russia under Putin

Bright spot in oil is gone

Re-Sovietization

Corruption

Total control of press

Investment climate has

cooled down

Production is bound

to decline


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G N I i


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Gazproms New Imperium


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iiCanCan

Keep the Lights On?Keep the Lights On?


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Energy

: Chinas Choke Point


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From Stratfor, 2009


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China and Russia Energy will be Chinas choke point

Has become recently very assertive,if not belligerent.

Sudan, Nigeria

Canada

Argentina, Venezuela

Chinas energy future passesthrough Russia.


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Russia and China


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Russia, China and Japan

Chi ill b bl l d


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China will probably lead

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Energy Geopolitics 2009

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