• 2 days Shell Oil Trading Head Steps Down After 29 Years
  • 2 days Higher Oil Prices Reduce North American Oil Bankruptcies
  • 2 days Statoil To Boost Exploration Drilling Offshore Norway In 2018
  • 2 days $1.6 Billion Canadian-US Hydropower Project Approved
  • 3 days Venezuela Officially In Default
  • 3 days Iran Prepares To Export LNG To Boost Trade Relations
  • 3 days Keystone Pipeline Leaks 5,000 Barrels Into Farmland
  • 3 days Saudi Oil Minister: Markets Will Not Rebalance By March
  • 3 days Obscure Dutch Firm Wins Venezuelan Oil Block As Debt Tensions Mount
  • 3 days Rosneft Announces Completion Of World’s Longest Well
  • 3 days Ecuador Won’t Ask Exemption From OPEC Oil Production Cuts
  • 4 days Norway’s $1 Trillion Wealth Fund Proposes To Ditch Oil Stocks
  • 4 days Ecuador Seeks To Clear Schlumberger Debt By End-November
  • 4 days Santos Admits It Rejected $7.2B Takeover Bid
  • 4 days U.S. Senate Panel Votes To Open Alaskan Refuge To Drilling
  • 4 days Africa’s Richest Woman Fired From Sonangol
  • 4 days Oil And Gas M&A Deal Appetite Highest Since 2013
  • 4 days Russian Hackers Target British Energy Industry
  • 5 days Venezuela Signs $3.15B Debt Restructuring Deal With Russia
  • 5 days DOJ: Protestors Interfering With Pipeline Construction Will Be Prosecuted
  • 5 days Lower Oil Prices Benefit European Refiners
  • 5 days World’s Biggest Private Equity Firm Raises $1 Billion To Invest In Oil
  • 5 days Oil Prices Tank After API Reports Strong Build In Crude Inventories
  • 5 days Iraq Oil Revenue Not Enough For Sustainable Development
  • 6 days Sudan In Talks With Foreign Oil Firms To Boost Crude Production
  • 6 days Shell: Four Oil Platforms Shut In Gulf Of Mexico After Fire
  • 6 days OPEC To Recruit New Members To Fight Market Imbalance
  • 6 days Green Groups Want Norway’s Arctic Oil Drilling Licenses Canceled
  • 6 days Venezuelan Oil Output Drops To Lowest In 28 Years
  • 6 days Shale Production Rises By 80,000 BPD In Latest EIA Forecasts
  • 6 days GE Considers Selling Baker Hughes Assets
  • 6 days Eni To Address Barents Sea Regulatory Breaches By Dec 11
  • 6 days Saudi Aramco To Invest $300 Billion In Upstream Projects
  • 7 days Aramco To List Shares In Hong Kong ‘For Sure’
  • 7 days BP CEO Sees Venezuela As Oil’s Wildcard
  • 7 days Iran Denies Involvement In Bahrain Oil Pipeline Blast
  • 9 days The Oil Rig Drilling 10 Miles Under The Sea
  • 9 days Baghdad Agrees To Ship Kirkuk Oil To Iran
  • 9 days Another Group Joins Niger Delta Avengers’ Ceasefire Boycott
  • 9 days Italy Looks To Phase Out Coal-Fired Electricity By 2025
Alt Text

Markets Shrug On Flat Oil Rig Count

The United States oil rig…

Alt Text

Can We Expect An Oil Price Correction Soon?

While oil sentiment is bullish…

Alt Text

IEA’s Shocking Revelation About U.S. Shale

The latest IEA report caught…

The Oil Drum

The Oil Drum

The Oil Drum seeks to facilitate civil, evidence-based discussions about energy and its impacts on the future of humanity, as well as serve as a…

More Info

Former IEA Oil Expert: Oil Production Could Begin to Decline in 2015

Former IEA Oil Expert: Oil Production Could Begin to Decline in 2015

The following interview is a guest post by Matthieu Auzanneau, a freelance journalist living in Paris. This article previously appeared in Le Monde.

Olivier Rech developed petroleum scenarios for the International Energy Agency over a three year period, up until 2009. This French economist now advises large investment funds on behalf of La Française AM, a Parisian assets management firm.

His forecasts for future petroleum production are now much more pessimistic than those published by the IEA. He expects stronger tensions as of 2013, and an inevitable overall decline of oil production "somewhere between 2015 and 2020", in the following interview.

Olivier Rech
Olivier Rech, responsible for petroleum issues at the International Energy Agency from 2006 to 2009.

Rech’s outlook serves as another significant contribution to the expanding list of leading sources portraying the threat of an imminent decline in global extraction of crude oil.

MA: What do you foresee? Let’s begin with the non-OPEC producers (which represent 58% of production and 23% of global reserves).

OR: Outside OPEC, things are clear: of 40 million barrels per day (mb/d) of conventional petroleum extracted from existing fields, we face an annual decline on the order of 1 to 2 mb/d.

MA: In your view, are we therefore close to the 5% decline per year from existing production mentioned by Royal Dutch Shell?

OR: Yes, that’s about it.

MA: And for OPEC production (42% of production and 77% of global reserves)?

OR: It’s more difficult to say; the data are still opaque. We are stuck in a haze. Nevertheless, I note that Barclays and Goldman Sachs banks estimate that the spare production capacity of OPEC, more particularly that of Saudi Arabia, is significantly lower that what is officially claimed.

MA: Many new production projects are presently under development all around the world. What should we expect of them?

OR: There are new projects off the coasts of Brazil, Ghana and Guyana. The Gulf of Mexico is far from being depleted. The Arctic is far less certain, but there is real potential for natural gas there.
Nevertheless, we must still expect a decade before seeing eventual and significant production of petroleum.

MA: In that case, what is your view on the timing of the global peak and decline of total world oil and alternative liquid fuels output?

OR: It is always delicate to project a precise date. The recovery rate of existing fields is increasing. The US on-shore production is declining very slowly (and one must add that they are drilling in a frenzy over there). It is an error to underestimate the know-how of drilling engineers.

MA: Taking account of all these factors capable of slowing a decline, what conclusion do you draw?
OR: We will certainly remain below 95 mb/d for the combined totals of conventional and non-conventional oil.

MA: Therefore, you are clearly more alarmist than the IEA and Total, the most pessimistic of petroleum companies. Total evokes the possibility of maintaining production on a plateau of about 95 mb/d until 2030.

OR: It's true. The production of oil has already been on a plateau since 2005 at around 82 mb/d. [NB: with biofuels and coal-to-liquid, we approximate 88 mb/d for all liquid fuels.] It appears to me impossible to go much higher. Since demand is still on an increasing trajectory (unless, possibly, the economic crisis engulfs the emerging economies), I expect to see the first tensions arising between 2013 and 2015.

MA: And after that?

OR: Afterwards, in my view, we will have to face a decline of the production of all forms of liquid fuels somewhere between 2015 to 2020. This decline will not necessarily be rapid, however, but it will be a decline, that much seems clear.

MA: You state “not necessarily rapid”. Why?

OR: This will all depend on the speed at which streams of non-conventional oil will be able to be developed. Conversion of coal and natural gas to liquid fuels will remain infinitesimal. For first-generation biofuels, I believe we are already approaching the maximal limit. As for second-generation biofuels, we are still at the stage of industrial pilot projects. It should take another quarter century before we achieve a significant production on a world scale, let’s say around 2.4 mb/d.

MA: In your view, will all of this be insufficient to compensate for the decline of existing conventional oil fields?

OR: Insufficient, yes.

By. Joules Burn

Source: The Oil Drum




Back to homepage


Leave a comment
  • Fred Banks on January 09 2012 said:
    Very valuable article, and the date mentioned - 2015 - is the date I heard several times when visiting Paris. This is the kind of information we both need and deserve.

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News