Norwegian Energy Situation · Report on: CO2 EARLY MARKETS Report on: CO2 EARLY MARKETS The Gap:...

Ministry of Petroleum and Energy www.mpe.dep.no

Brasilia, 27 June 2007

Norwegian Energy Situation

Jostein Dahl KarlsenSenior adviser

Ministry of Petroleum and Energy

Past, present and future perspectives


Norway as a LeadingEnergy Nation

0

50

100

150

200

250

Energy Production Total Final Consumption

Mto

e

Coal, Coke

Bio

Electricity

Gas

Petroleum Products

Crude Oil

Before NCSOil & Gas


Production and net export of crude oil incl. NGL2004

Production Net export

Source: Petroleum Economics Ltd.

2,35

2,60

3,08

3,19

3.49

3,83

3,96

7.62

9,02

9,20

0 5 10

UAE

Venezuela

Canada

Norway

China

Mexico

Iran

USA

Saudi Arabia

Russia

mill b/d

1,51

1,76

2,01

2,01

2,04

2,10

2,47

2,93

6.47

7,04

0 2 4 6 8

Iraq

Mexico

Kuwait

UAE

Nigeria

Venezuela

Iran

Norway

Russia

Saudi Arabia

mill b/d


0

20

40

60

80

100

120

140

1981

1984

1987

1990

1993

1996

1999

2002

2005

2008

2011

2014

2017

2020

2023

BC

M

Rising Natural Gas ExportsInfrastructure Gas Sales


More than 35-years History of Achievements

Subsea to land

New technology

Time1985

Statpipe

1986

G.faks

1993

Sleipner

1994

Statfjordsatellites

1997

Norne

2001

Glitne

1996

Troll

1999

Åsgard

Platform-based

Subsea & floating

Significantstep changes

Snøhvit

2006

Ekofisk

Source: Statoil


2007Leading

1960No Oil and Gas

Industry

• INNOVATION• POLITICAL WILL• INDUSTRIAL BASE

E.g.: Seismics, Automation, Drilling, Horisontal Wells, FloatingProduction, Subsea, Multiphase Techs. and Remote control

Drivers:


The Future?

• Sunset or Expansive?

Role of technology?


Ocean

Renewables/Nuclear

2003

2050

Coal24%

Renewables/Nuclear

Oil 34%

Nat. Gas21%

Oil 27%

Coal 34%

Nat. Gas24%

The “Fossil Fuel Future”By Fuel Share

Source: Energy Technology Perspectives Study, IEA 2006


Global Peer Review & Assessment Activities

IEA World Energy Outlook (WEO);

World Energy Supply 2001 Outlook - Oil and Gas Chapter

“Assessing Today's Supplies to Fuel Tomorrow's Growth”

• IEA WEO 2002- Energy & Powerty

• IEA Investment Book2003

• IEA WEO 2005Middle East Region

IEA Advisory Group on Oil and Gas Technology

Oil and Gas Technology

Report on:CO2 EARLY MARKETS

Report on:CO2 EARLY MARKETS

The Gap:115 -150 mill. bbl.


Source: IEA 2005, Resources to Reserves – Oil & Gas Technologies for the Energy Markets of the Future

Coal to Liquids

Future Oil Price and Supply


The Norwegian supply industry: International sales

0

2

4

6

8

10

12

1995 1997 1999 2001 2005 2010

Bill. USD

Source: INTSOK


Norwegian TechnologyIn a Global Perspective

Historically Today & Future

”Goldplated” More Mainstream Highly Needed

Historically Today & Future

”Goldplated” More Mainstream Highly Needed

Use Experiencefrom Elsewhere Globalize

Alignment of Needs


Established Offshore RegionsEmerging Offshore RegionsFuture Offshore Regions

Subsea Arenas

Source: FMC


Leading Countries for Proven Oil Reserves

0 50 100 150 200 250

AzerbaijanKazakhstan

NorwayBrazil

AlgeriaMexico

QatarChinaUSA

NigeriaLibya

RussiaVenezuela

UAEKuwait

IraqIran

CanadaSaudi Arabia

billion barrels

North American Oil Sands Cooperation


The Comparative Cost Structure - Global E & P

Indicative Numbers Only

Volume of production vs . cost for some regions (US$/bbl),

and expenditure (million US$/day)

Source: “Oil and Gas Industry Task Force, Energy Information Administration: Country Analysis Briefs, BP Amoco Statistical Review, MSDW, NPD” in T.Reve and E.W. Jakobsen : Et verdiskapende Norge , Universitetsforlaget 2001

20

15

10

5

0

1,5

4

9

12

Saudi Arabia Malaysia Gulf ofMexico

Norway

9.2 million bbl/d3.0

m.b/d0.7

mbd

3.5m.b/d

Volume

US$

/bbl

North West Europe

2.8m.b/d

13

36 m.$/d3 m.$/d

32 m.$/d 36 m.$/d

14 m.$/d


Technology and Cost Reduction

0

20

40

60

80

100

120

140

1000

NO

K i

nves

ted

per d

aily

bar

rel

prod

uctio

n

Permanent installations

Floating production solutions

Draugen

Statfjord B

Gullfaks A

Statfjord C

Åsgard A

Njord

Åsgard B

Norne

Source: Statoil

Subsea

Next Step:


0

5

10

15

20

25

30

35

40

1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002

US$/Bbl

Gulf Crisis

Asian Financial Crisis

OPEC Production Cut

9.11

Oil Price & Activity Level

NCSInvestment Freeze

2007:”All-time High”-Activity

@ 50-70 USD/Bbl

• BC 10, etc.• Snøhvit• Ormen Lange

Competetiveness:


06

1

Resources and Exploration Potential

Reserves (bn boe)

Produced (bn boe)

3 7 11

24 1217


Enabling Access to Remote and Challenging Opportunities


Enhanced Access to new Frontiers

2003 Summer Ice

KaraBarents

Chukchi

Laptev

East Siberia

BeaufortMcKenzie

West Greenland

East Greenland

Sverdrup

The worlds remainingconv. hydrocarbon potential

N. AfrikaCaspian SeaMiddle East

Rest ofThe world

Arctic

Source: USGS


Norwegian Polar Expeditions


Ny-Ålesund2004:

The opening of the ChineseYellow River Station


Snøhvit – a New Concept for LNG Production

030326-LL 16

16

• Sub-sea production

• Multiphase transport > 140 km

• LNG process and shipping technology

Source: Statoil)


Cold Flow Subsea Process


Remaining Oil ResourcesNorwegian Continental Shelf

54 % remainsin the ground

Target: 45 %remaining

Highly R & D Intensive


NCS Water Production

0

50

100

150

200

250

300

350

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

Mill

m3/

år

Water prod.Emissions


Tordis SSBI – Systemoversikt


Extreme Conditions

0

2000

4000

6000

8000

10000

12000

1965 1970 1975 1980 1985 1990 1995 2000 2005 2010

Dep

th (f

eet)

• Water debth• Reservoir Debth• HTTP


Atlantic Margin


Suppliers R&D

Operators

The Norwegian Model……

“From the backseat to the driver’s seat”

• Forging links

• Developing networks

• Creating synergies

• Co-funding

• Government Leaderserhip


Basic Research & Development

Demonstration and Piloting

OperatorsOperators ContractorsContractors UniversitiesUniversities andandReseachReseach InstitutesInstitutes

TheThe GovernmentGovernment

Lead Parties


Key

Pacing

Emerging

Base

Technology Ambition

Clear Leader Strong Favourable Tenable Weak

CompetitiveImpact

I - Industry, P - Public)

I

I + P

P

Gasstechnology

Deepwater andSubsea Prod.

Subsea Processing andtransport

Integrated operations

Enhanced OilRecovery

Environmental Technologies

Cost Efficient Drilling

ExplorationTechnology

OG 21 Assessment of National Technology Positio


Global Desease and Cure

Problem Solution


Trends towards difficult hydrocarbons

Remote

Marginal

Tight Gas

CoalbedMethane

Coal Gasification

Tar & Bitumen

Oil ShalesGas Hydrates

Gas Shales

Heavy Oil

Conventional

Contaminated

Carbon Intensity

Emerging

Increasing Cost

Adapted from Holditch & Hart’s E&P

Resource Volume

Fundamental Technology Challenges:

ExpensiveHigh Carbon

Current

”Norsk”fokus


North Sea Sanctioned and Planned CCS Projects

Examples

The Mongstad CO2 EOR Project

Shell & StatoilHalten CO2

(Investments:Sanctioned by 2008)

Kaarstoe


We will work to accelerate the development and commercializationof Carbon Capture and Storage technology by:

…inviting the IEA to work with the CSLF to hold a workshop on short-term opportunities for CCS in the fossil fuel sector, including from Enhanced Oil Recovery and natural gas production.


IEA’s response to G8’s Request:

Three workshops:

1) San Franscisco, 22 – 23 August 2006 — Issues

2) Oslo, 21 – 22 June 2007 — Assessments

3) Calgary, late November 2007 — Recommendations

Report to be delivered to the G8, Japan, 2008


Fornybar energi

SWEY flytende turbin

Biomasse


PublicPublic RD & D Programme RD & D Programme StructureStructureHydrocarbons & EnergyHydrocarbons & Energy

Petromaks Demo 2000

Basic research

R & D Demonstration Application

RENERGI

Research Council Gassnova

Climit

National Strategy, OG21 (Oil and Gas in the 21st Century)

Gas Gas powerpowerwith COwith CO22--removal &removal &storagestorage

OilOil and and GasGas

RenewableRenewableEnergy/Energy/Energy Energy UseUse

”Innovative energy-solutions”, NFR/Enova

”E-21” Established 1st half ’07


Cold Flow

E-field


RECRUITMENT among coming generationsimportant

- requires stronger basic competence within naturalsciences

OECD Global Science Forum:

”General Decline in Scienceand Technology

Students Internationally”!


Thank you for your attention

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Norwegian Energy Situation · Report on: CO2 EARLY MARKETS Report on: CO2 EARLY MARKETS The Gap:...

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