annual energy outlook 2013 future of u.s. domestic oil and gas production

www.eia.govU.S. Energy Information Administration Independent Statistics & Analysis

Annual Energy Outlook 2013Future of U.S. Domestic Oil and Gas Production

ForInternational Energy ForumJanuary 21, 2013 | Riyadh, KSA ByAdam Sieminski, Administrator

Annual Energy Outlook 2013 projections to 2040

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• Growth in energy production outstrips consumption growth

• Crude oil production rises sharply over the next decade

• Motor gasoline consumption reflects more stringent fuel economy standards

• The U.S. becomes a net exporter of natural gas in the early 2020s

• U.S. energy-related carbon dioxide emissions remain below their 2005 level through 2040

Adam Sieminski January 21, 2013

Growth in energy production outstrips growth in consumption leading to reduction in net imports

3

U.S. energy production and consumptionquadrillion Btu

Source: EIA, Annual Energy Outlook 2013 Early Release

Consumption

Production

Net imports

9%

19%

10%

History Projections2011 2035


Petroleum

4Adam Sieminski January 21, 2013

Reference case oil price initially drops and then rises steadily, but there is uncertainty about the future trajectory

5

Annual average spot price of Brent crude oil2011 dollars per barrel

ProjectionsHistory 2011

High Oil Price

Low Oil Price

Reference



U.S. tight oil production leads a growth in domestic production of 2.6 million barrels per day between 2008 and 2019

6

U.S. crude oil productionmillion barrels per day


Tight oil

Alaska

Other lower 48 onshore

Lower 48 offshore



New light-duty vehicle fuel economy approaches 50 mpg by 2040

7

New LDV fuel efficiencymiles per gallon


2011 ProjectionsHistory

Summary of LDV standards

2012-2016: Increase to 34.1 mpg CAFE average in 2016 (based on vehicle footprint sales distribution)

2017-2025: Increase to 47.4 mpg CAFE average in 2025 (based on vehicle footprint sales distribution)


Light-duty vehicle liquids consumption is lower primarily due to more stringent CAFE standards

8

Light-duty vehicle liquids consumptionmillion barrels per day


AEO2012

AEO2013


Transportation sector motor gasoline demand declines

9

Transportation energy consumption by fuelquadrillion Btu


60% Motor gasoline

E85Jet fuel

CNG/LNG11%

13%4%

29%

47%


2%

Pipeline fuel 3%

4%

Other4%

Diesel22%

1%


U.S. petroleum product exports exceeded imports in 2011 for first time in over six decades

10

Annual U.S. net exports of total petroleum products, 1949 – 2011million barrels per day

Source: EIA, Petroleum Supply Monthly

net product exporter


U.S. dependence on imported liquids declines

11

U.S. liquid fuel supplymillion barrels per day


Consumption

Domestic supply

Net imports45%

37%


60%

2005


Global liquids supply increases 26 percent with regional market shares relatively stable

12

Global liquids supplymillion barrels per day



OPEC

Other non-OECD

OECD

44%

25%

31%

40%

26%

34%


Natural Gas


Shale gas production leads growth in production through 2040

14

U.S. dry natural gas productiontrillion cubic feet


Associated with oilCoalbed methane

Tight gas

Shale gas

Alaska

Non-associated onshore

Non-associated offshore



15

U.S. dry gas consumptiontrillion cubic feet


ProjectionsHistory

Industrial*

Electricpower

Commercial

Residential

Transportation**

33%

14%

6%

32%

12%

33%

19%

3%

31%

13%

*Includes combined heat-and-power and lease and plant fuel.**Includes pipeline fuel.

Gas to liquids2%

Natural gas consumption is quite dispersed with electric power, industrial, and transportation use driving future demand growth


Growth of natural gas in transportation led by heavy duty trucks (LNG) and gas to liquids (diesel)… marine and rail to come?

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U.S. natural gas consumptionquadrillion Btu

Pipeline fuel

Light-duty vehicles

2011History Projections

95%

3%

1%

1%

28%

38%

3%

31%

1%Buses

Freight trucks

Gas to liquids

Note: Gas to liquids includes heat, power, and losses.Source: EIA, Annual Energy Outlook 2013 Early Release


Domestic natural gas production grows faster than consumption and the U.S. becomes a net exporter of natural gas around 2020

17

U.S. dry gastrillion cubic feet



Consumption

Domestic supply

Net imports


Total natural gas exports nearly quadruple by 2040 in the AEO2013 Reference case

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U.S. natural gas exportstrillion cubic feet


Alaska LNG exports

Exports to Mexico

Exports to Canada

Lower 48 LNG exports


Coal and Electricity


Growth in electricity use slows, but still increases by 28% from 2012 to 2040

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U.S. electricity usepercent growth (3-year rolling average)


Structural Change in Economy - Higher prices - Standards - Improved efficiency

Projections

History 2011

Period Annual Growth1950s 9.81960s 7.31970s 4.71980s 2.91990s 2.42000-2011 0.92012-2040 0.9


Over time the electricity mix shifts toward natural gas and renewables, but coal remains the largest fuel source

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U.S. electricity net generationtrillion kilowatthours

25%

19%

42%

13%

1%

Nuclear

Oil and other liquids

Natural gas

Coal

Renewables


17%

16%

35%

30%

1%

1993

53%

13%

19%

11%

4%



Changing electricity generation mix in AEO2012 reference case and carbon fee allowance side cases

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U.S. electricity net generationtrillion kilowatthours

Source: EIA, Annual Energy Outlook 2012

Natural gas

2012 Reference Case $15 Carbon Fee $25 Carbon Fee

Renewables

Nuclear

Coal

Natural gas Natural gas

Renewables

RenewablesNuclear

NuclearCoal

Coal

2010

24%

10%

20%

45%

28%

15%

18%

38%

34%

22%

27%

16%

34%

23%

38%

4%


Coal regains some competitive advantage relative to natural gas over time on a national average basis

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ratio of natural gas price to steam coal price


History Projections

2011 2011 dollars per BtuHistory Projections2011

Competitive parity

Energy prices to the electric power sector

Coal

Natural gas


U.S. continues to be a net exporter of coal

24

million short tons



Consumption

Domestic Supply

Net imports


Non-hydro renewable generation more than doubles between 2011 and 2040

25

Non-hydropower renewable generationbillion kilowatthours per year


Wind

Solar

GeothermalWaste

Biomass

Industrial CHP

Power sector

Advanced biofuels cogeneration (not visible)



Energy and CO2 per dollar of GDP continue to decline; per-capita energy use also declines

26

Energy and emission intensityindex, 2005=1


History Projections2011

Carbon dioxide emissionsper 2005 dollar of GDP

Energy use per 2005dollar of GDP

Energy use per capita

2005


In the AEO2013 Reference case, energy-related CO2 emissions never get back to their 2005 level

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Carbon dioxide emissionsbillion metric tons



2005 2020 2040(billion metric tons)

6.00 5.45 5.69

- - -9.0% -5.1%

(percent change from 2005)

AEO2013


For more information

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U.S. Energy Information Administration home page | www.eia.gov

Annual Energy Outlook | www.eia.gov/forecasts/aeo

Short-Term Energy Outlook | www.eia.gov/forecasts/steo

International Energy Outlook | www.eia.gov/forecasts/ieo

Today In Energy | www.eia.gov/todayinenergy

Monthly Energy Review | www.eia.gov/totalenergy/data/monthly

Annual Energy Review | www.eia.gov/totalenergy/data/annual


http://www.eia.gov/

http://www.eia.gov/forecasts/aeo

http://www.eia.gov/forecasts/steo

http://www.eia.gov/forecasts/ieo

http://www.eia.gov/todayinenergy

http://www.eia.gov/totalenergy/data/monthly

http://www.eia.gov/totalenergy/data/annual

annual energy outlook 2013 future of u.s. domestic oil and gas production

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annual energy outlook

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