Energy Watch Group: Steep Decline in Oil Production Coming
Experts from the Energy Watch GroupBackground
The Energy Watch Group (EWG) initiated by German MP Hans-Josef Fell, is a group of independent scientists and experts who investigate sustainable concepts for global energy supply. The experts at EWG use patterns of production, rates of discoveries, and non-conventional source prospects to draw reliable information upon which to base realistic projections. They avoid reserves data, since more than 70 countries report unchanged figures year after year. Continuous re-assessment is untenable during decline periods, as the passing of time and the absence of crude oil growth tend to endorse lower-level hypotheses.
Peak Oil Is Here
EWG analysts assert that Peak Oil occurred in 2006. However, pinpointing the precise instant is incidental. The real progress lies in the growing consensus that production will no longer rise and decline will soon commence, if it has not already. In this way, dwindling reserves of fossil fuels combined with the threats posed by climate change invoke the need for alternate energy systems to be streamlined and implemented in the near future.
Findings From the Energy Watch Group
- Once big oil-fields reach capacity, or highest yield, their productivity decreases. Subsequently, new, smaller fields must be tapped, all of which peak not too long after. Techniques known as “Enhanced Oil Recovery” (EOR) can mitigate decline after peak. In any event, this dynamism contributes to the overall decline of oil production. As costs rise and growth rates drop, production plateaus and then declines.
- Due to high costs and meager yields, procurement of new, unconventional sources is unlikely to have a more than marginal impact on production. Some of these unconventional sources could be hazardous to human workers and devastating to the environment:
- Canadian tar sands would be very expensive to exploit. Extraction requires high amounts of energy and large quantities of water. Furthermore, the high sulfuric content poses a threat to the environment and workers.
- The heavy oil in Venezuela is expensive to extract and refine, and does not provide good prospects of offsetting production decline for long.
- Canadian tar sands would be very expensive to exploit. Extraction requires high amounts of energy and large quantities of water. Furthermore, the high sulfuric content poses a threat to the environment and workers.
- In the recent past, findings of new sizable offshore and deep sea oil have been few and far between. This pattern suggests new discoveries will not play a big role in augmenting future production.
- Most of the world’s major oil fields have peaked, including Cantarell in Mexico and Prudhoe Bay in Alaska. Although data is not available regarding Saudi Arabian Ghawar, the world’s largest oil field, it is sensible to assume that it has reached capacity after fifty years of pumping. Current figures for Middle Eastern countries are therefore questionable at best. A statement made by Saudi Arabia’s King Abdullah in August of this year is presented by EWG as an acknowledgement of the new reality: “The oil boom is over and will not return…all of us must get used to a different lifestyle.”
- OPEC can no longer affect oil prices. Furthermore, production in non-OPEC countries not yet affected by a peak is decreasing by single-digit percentages each year. Only Brazil and Angola could feasibly expand future production.
Peaks by Year
2010: Russia, Africa, China, Southeast Asia.
2008-09: Azerbaijan.
2006: Middle East, World.
2000: Venezuela, Western Europe, Australia.
1990: Indonesia.
1984: North America.
Disagreement From IEA, ASPO and CERA
The International Energy Agency (IEA), in contrast, does not see a substantial production decline coming until 2030, and even then do not see the sharp dropoff in energy production predicted by EWG. IEA acknowledges informational shortcomings regarding uncertain costs associated with extracting these sources, however, as well as possible misinformation on current conventional reserves. Leading members of the IEA have also recently alluded to a looming “energy crunch.”
The Association for the Study of Peak Oil and Gas (ASPO) has also found a later date for Peak Oil than EWG. ASPO uses standard figures for reserves in the Middle East; these largely account for the discrepancies. ASPO’s findings still endorse the notion that Peak Oil is real and scientifically based.
CERA (Cambridge Energy Research Associates), which seeks to actively discredit the Peak Oil theory, is alleged by EWG to be “close to the energy industry” and therefore presented as less credible.The summary above was prepared by the Atlantic Community editorial team based on the third in a series of Energy Watch Group papers on future energy supply and demand patterns. Crude Oil: The Supply Outlook was published in October 2007 and is available here.
Prepared by Christian Andreas Morris
Related Materials from the Atlantic Community:- F. William Engdahl warns Beware of False Assumptions on US Energy Policy
- Stuart Butler and Kim Holmes offer Five Principles for US Energy Security
- Big Oil Getting Smaller
