How much oil do we have left? According to the United States Geological Survey's (USGS) latest report, published in 2000, the planet had 3 trillion barrels of oil and gas before we started using it up. It calculates we have used some 700 billion, leaving 2.3 trillion barrels underground.
A simple calculation using data from the Center for Global Energy Studies (CGES) shows that with 28.8 billion barrels currently being used a year (79 million a day), there is some 80 years of supply left in the ground.
However, the 2.3 billion barrels left includes 1.4 billion which, according to USGS analysis of global geology, exist but have yet to be discovered. That leaves roughly 890 billion barrels of oil and gas that have been discovered and are booked as proven reserves -- roughly 31 years' supply.
This estimate is lower than the industry's. BP's oil statistics -- the industry bible -- indicate some 1,047 billion barrels of proved reserves -- 36 years supply on current usage.
But analysts don't worry about this too much. Derek Butter of consultancy Wood Mackenzie says: "It is not something we get hung up about. We think in the medium term there is enough oil in reserve."
The BP statistics show that over the past decade, reserves have been roughly constant -- in 1992 there were 1,006 billion barrels -- indicating that through the 1990s the industry has been effective at finding reserves to replace the resources we use. It has done well -- in 1982, the figure was only 676 billion.
Manouchehr Takin of the CGES says: "Forty years ago, economists and geologists said there were 40 years of oil and gas left. Now they are saying the same."
He adds: "The techniques for finding oil and extracting it are advancing rapidly. It shows that at any one time what is left, and the time it will take to use this up is only a snapshot dictated by the current state of knowledge. And, of course, there is the impact of economic development, and the efficiency with which we use energy."
Efficient energy use, he argues, has offset the growth of formerly non-industrialised countries, such as India and China, which have anyway not grown as rapidly as was expected in the Sixties and Seventies. Similar dynamics are likely to continue.
Nevertheless, demand for oil is likely to increase, as, over time, is the price. Former UK Environment Minister Michael Meacher pointed to a crunch by 2015, when he says demand is likely to total some 60 million barrels a day more than the current 79 million, while supplies will only be some 90 million.
CGES argues that Meacher has overstated the increase in demand. It argues that taking reserves into account, his estimates imply 4 percent growth a year, whereas, depending on price, CGES forecasts between 1 percent and 1.3 percent, while OPEC has 1.7 percent.
At the top end of its range, CGES believes demand will be 87.7 million barrels a day, within its expected production level.
Nevertheless, as Wood Mackenzie points out, nothing can be taken for granted. In a note last week it said: "There is no escaping the fact that oil and gas are finite resources: the more that has been found, the less that remains to be found."
The crux is this: Will exploring and finding new reserves be worth it for companies? Theory suggests that as easy resources are depleted extraction becomes more difficult, but that reduction in supply increases price, underpinning the eventual return for companies.
Wood Mackenzie is sceptical. It points out that between them major western countries need to find reserves equivalent to Angola's every 15 months just to stand still.
It shows that new areas such as Alaska face difficulties because of extreme environmental sensitivities and regulatory concerns. Other areas, such as Nigeria, and newer ones, such as Benin, are uncertain.
Companies must take greater risks -- such as exploration in ever deeper water, and expensive investment in extraction from shale beds.
And it points out that reserve replacement has often been achieved by shuffling finds into the proved category rather than actually finding more oil (which underlines the importance of Shell's declassification of reserves).
Eventually, it will be down to consumers to decide when the price of oil and gas makes it no longer worthwhile investing in things that are powered by them. It is likely, concedes Takin, to be well before our notional 2.3 trillion barrels are used up ... whenever that may be.
Taiwan’s foreign exchange reserves fell below the US$600 billion mark at the end of last month, with the central bank reporting a total of US$596.89 billion — a decline of US$8.6 billion from February — ending a three-month streak of increases. The central bank attributed the drop to a combination of factors such as outflows by foreign institutional investors, currency fluctuations and its own market interventions. “The large-scale outflows disrupted the balance of supply and demand in the foreign exchange market, prompting the central bank to intervene repeatedly by selling US dollars to stabilize the local currency,” Department of Foreign
ENERGY ISSUES: The TSIA urged the government to increase natural gas and helium reserves to reduce the impact of the Middle East war on semiconductor supply stability Chip testing and packaging service provider ASE Technology Holding Co (日月光投控) yesterday said it planned to invest more than NT$100 billion (US$3.15 billion) in building a new advanced chip testing facility in Kaohsiung to keep up with customer demand driven by the artificial intelligence (AI) boom. That would be included in the company’s capital expenditure budget next year, ASE said. There is also room to raise this year’s capital spending budget from a record-high US$7 billion estimated three months ago, it added. ASE would have six factories under construction this year, another record-breaking number, ASE chief operating officer Tien Wu
For weeks now, the global tech industry has been waiting for a major artificial intelligence (AI) launch from DeepSeek (深度求索), seen as a benchmark for China’s progress in the fast-moving field. More than a year has passed since the start-up put Chinese AI on the map in early last year with a low-cost chatbot that performed at a similar level to US rivals. However, despite reports and rumors about its imminent release, DeepSeek’s next-generation “V4” model is nowhere in sight. Speculation is also swirling over the geopolitical implications of which computer chips were chosen to train and power the new
The EU and US are nearing an agreement to coordinate on producing and securing critical minerals, part of a push to break reliance on Chinese supplies. The potential deal would create incentives, such as minimum prices, that could advantage non-Chinese suppliers, according to a draft of an “action plan” seen by Bloomberg. The EU and US would also cooperate on standards, investments and joint projects, as well as coordinate on any supply disruptions by countries like China. The two sides are additionally seeking other “like-minded partners” to join a multicountry accord to help create these new critical mineral supply chains, which feed into
RSS