Fossil and Nuclear Fuels – the Supply Outlook

7/28/2019 Fossil and Nuclear Fuels the Supply Outlook

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Fossil and Nuclear Fuels the Supply

Outlook

March 2013 1


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World Fossil and Nuclear energy supply

(Mtoe = equivalent energy units)


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World Oil - Conventional

World oil production (conventional and

unconventional) has not increased but has

entered a plateau since about 2005.

The production of conventional oil is in slight

decline since about 2008.

The peaking of conventional oil is now also

accepted by the International Energy Agency

(IEA).


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Historical discovery pattern of world

conventional oil fields and projection until 2040.


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World oil production - forecast


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World oil production

(WEO = World Energy Outlook, produced by IEA)


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World oil demand according to WEO 2012.


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US oil production 1935 -2030

accounting for light tight oil


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Total US oil demand declined since 2005 at an

unprecedented decline rate and has now reached a

level last seen in the 1980s.

Hamilton (2009) shows that high oil prices causedthis demand destruction which culminated in the

2009 recession.

If the present trend continues, total demand might

be reduced by 50 per cent in 2030 compared with

its 2005 level when it reached an all-time high.

US oil demand


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US Oil and Gas - Unconventional

Recent increases of unconventional oil and gasproduction in the USA are due to a number ofspecific conditions, such as a highly developed oiland gas industry and infrastructure and, most

important, the high oil and gas prices reached in2006.

There is a high probability that light tight oilproduction in the USA will peak between 2015

and 2017, followed by a steep decline. Light tightoil production will likely turn out to be a bubble,lasting only for about 10 years.


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Production in the Barnett shale has

peaked in the summer of 2011.

The Haynesville shale production has

already peaked

EAGLE Ford Shale production peaked in

autumn 2011

Texas shale gas


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US Shale Gas Production


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US Shale gas

The shale gas boom after 2005 led to a fast risingdomestic production together which in 2008 met with

an economic downturn resulting in a collapse of gas

prices.

It is often claimed that the crunch of gas prices was a

result of the development of shale gas.

This is combined with the claim that gas production

from gas shales is cheaper than conventional gasproduction.

The first part of that claim is correct, the second part is

not.


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Costs per well drilled are three to four times higher in

2007 than they were in 2000


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Viability of shale gas

The economic viability of natural gas production dependsto a high degree on the Estimated Ultimate Recovery

(EUR) of natural gas per well.

The gas flow of shale gas wells typically shows peak

production in the first days followed by a fast decline rate

in the range of 5 to 10 per cent per month.

Based on the projection that the EUR in individual shale

gas wells varies between 1.19 3 Bcf, the required break-even gas price is calculated to be between 5.06 to 8.75

USD/1000 scf.


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US Gas production forecast

Based on shale gas data by Texas RRC; Other data from US-EIA


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In contrast to North America, and irrespective ofenvironmental concerns, unconventional gas will

play a negligible role in Europe.

The first difference between Europe and the USA

is the population density in the shale areas which

in most European countries is much higher than in

the USA.

Secondly, more than 150 years of experience withthe production of oil and gas in the USA resulted

in a countrywide natural gas grid.

European Shale Gas?


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USA has about 500,000active gas wells 100,000 alone inTexas and a comparable number of oil wells. Germany

has 494 production gas wells.

In January 2013 in USA, more than 1,700onshore rigs were

active, drilling for oil and gas. In January 2013 only 80onshore rigs were active in the whole of Europe.

Though the number of active rigs may vary, the number of

available rigs sets a limit. The movement of new rigs into a

region is time and cost consuming and only possible when

these rigs are removed from other areas.

US shale gas vs Europe


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World coal production

(Bit = bitumin; Sub = sub-bituminous)


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Like every finite fossil energy resource, global coal supplyis going to peak. In many coal producing countries the

peak is already history.

A reasonably reliable picture of the future can be drawn.

We will see some further growth in global coalproduction followed by a peak in the not so distant

future.

However, there is definitely no scope for substituting oil

and gas in the long run by coal. There will be no

regression to coal as the long-term primary fossil energy

source.

The peak of all fossil fuels is already in sight.

The prospects for world coal


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Nuclear energy

Today the majority of the reactors in

operation are more than 25 years old.

Only 10 % of the net electrical capacity is

below 20 years of age.

Considering the age structure of reactors

today, the majority of operating reactors will

be shut down permanently within the next

two decades.


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Age of the operational nuclear power plant

fleet


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Historical uranium production and projection until

2100 based on Reasonably Assured Resources


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Summary

Coal and gas production will reach theirrespective production peaks around 2020

The decline of oil production which is expectedto start soon will lead to a rising energy gapwhich will become too large to be filled bynatural gas and/or coal

Substituting oil by other fossil fuels will also notbe possible

The energy contribution of nuclear fuels is toolow in order to have any significant influence atglobal level.


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Neither the hype about huge reserves in the Caspian Sea in the year 2000

(reserves could rival Saudi Arabia),

nor the deep sea discoveries in the Gulf of Mexico or West ofAngola,

nor tar sands in Alberta (cover story of the ExxonMobil

publication Oildorado in 2003),

nor the rush on shale gas developments in the USA nor recent news of shale gas in Australia

can do away the fact that the era of cheap and

abundant fossil fuels is coming to an end.

Rather, these new frontiers create more problems

than being solutions to problems they promise to

solve.


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Climate change forces us to take action, namely reducing

the consumption of fossil fuels

We must face these challenges and start in earnest to

develop transition strategies towards a sustainable

energy supply.

The longer we try to delay that transition by pursuing

dead end solutions which are aimed to prolong businessas usual, the more we face the risk of falling off a cliff

with severe disruptions in economy, politics and society.

This is a good message


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World Fossil and Nuclear energy supply

(Mtoe = equivalent energy units)


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About Energy Watch Group

Energy Watch Group is a non-partisan international network of scientists andparliamentarians whose work is independent of economic special interests.

Energy Watch Group was founded due to the initiative of the Germanparliamentarian Hans-Josef Fell and further parliamentarians from othercountries. It is supported by the Ludwig-Blkow-Foundation.

In this project scientists are working on studies independently of Governmentand company interests concerning

the shortage of fossil and atomic energy resources,

development scenarios for regenerative energy sources as well as

strategies deriving from these for a long-term secure energy supply ataffordable prices.

http://www.energywatchgroup.org

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Fossil and Nuclear Fuels – the Supply Outlook