export land model - 10-7-2010 aspousa trackbnetexports brown j
TRANSCRIPT
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Peak Oil Versus Peak Net Exports--Which
Should We Be More Concerned About?
Jeffrey J. Brown, Samuel Foucher, PhD,
Jorge Silveus
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Three Key Topics
! Peak Oil Versus the Export Land Model! Actual Net Export Decline Case Histories! Projections for the (2005) Top Five Net
Oil Exporters and for Global Net Oil
Exports
Note: Principal data sources are the EIA and BP data bases
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Two Peak Production Case Histories:
Texas and North Sea Crude Oil Production
1999 North Sea Peak
1972 Texas Peak
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Texas Crude Oil Production (1962-1982) and North
Sea Crude Oil Production(1989-2009) Versus US
Oil Prices
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Texas and North Sea Exponential Rates of Change
(ROC) Relative to Their Production Peaks
Texas
North Sea
RateofChange(%/year)
Texas production fell at 3.7%/ year from
1972 to 1982, resulting in 1982 production
being 31% below the 1972 rate.
North Sea production fell at 4.8%/year from 1999 to
2009, resulting in 2009 production being 38% below the
1999 rate.
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Three Primary Factors That Control
Net Export Declines
! Consumption as apercentage of production atfinal production peak
! Rate of change inproduction
! Rate of change inconsumption
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Export Land Model (ELM)
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Exponential Rate of Change in Production,
Consumption and Net Oil Exports by Year, Relative to
Final Production Peak, for Export Land
!"#$%&
!#%$%&
-40
-30
-20
-10
0
10
0 1 2 3 4 5 6 7 8 9
%/year
Year
Net Exports rate of change
Production rate of change (-5)
Consumption rate of change (2.5)
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Export Land
Net Export Fuel GaugeTotal Post Peak Cumulative
Net Exports (CNE)
Post Peak CNE 60%
Depleted 3 Yearsinto a 9 Year Decline
Annual Volume Down by40% From Peak.
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Three Primary Characteristics of Net
Export Declines:! The net export decline rate tends to exceed the
production decline rate
! The net export decline rate tends to acceleratewith time! Net export declines tend to be Front-end
loaded, with the bulk of post-peak net exports
being shipped early in the decline phase
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UK
Net Export Fuel GaugeTotal Post Peak Cumulative
Net Exports (CNE)&
Post Peak CNE 53%
Depleted in 2 YearsAnnual Volume Down by
27% From Peak.
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Indonesia
Net Export Fuel GaugeTotal Post Peak Cumulative
Net Exports (CNE)&
Post Peak CNE 53%
Depleted in 3 YearsAnnual Volume Down by
27% From Peak.
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Net Exports
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Actual and Projected Production, Consumption, and
Net Exports for Saudi Arabia
(Projections Based on Data Through 2006; 2007-2009 Actual Data Points Circled)
Consumption
Production Net Exports
Dashed Lines are 95% Confidence IntervalsDashed Lines are 95% Confidence Intervals
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Saudi Net Exports (2002-2008)
Versus US Oil Prices&
2002
2006
2008
2007
2005
2004
2003
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Dashed Lines are 95% Confidence Intervals
Production
Consumption
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Dashed Lines are 95% Confidence Intervals
Net Exports
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Actual and Projected Production, Consumption, and
Net Exports for (2005) Top 5 Net Exporters&
Dashed Lines are 95% Confidence Intervals Dashed Lines are 95% Confidence Intervals
Production
Consumption
Net Exports
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Projected (2005) Top 5 Net Exporters
Net Export Fuel GaugeTotal Post Peak Cumulative
Net Exports (CNE)&
Post Peak CNE 53%
Depleted by End of 2012Annual Volume Down by
34% From Peak.
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Canada
Sum
Rising Net Oil Exports from Canada have not even been able to offset thedecline in Net Oil Exports from Venezuela. Their combined Net Oil Exports
have fallen from 3.8 mbpd in 1998 to 2.8 mbpd in 2009.
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Total Oil Consumption (1998-2009) By Five Net Oil Importers
China, India, Kenya, Morocco & the US
(1998 consumption = 100, EIA)
India
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Morocco
Kenya
China
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Global
2005 Net Oil Exports
(Top 33): 46.0 mbpd
Projected 2015 Global
Net Oil Exports
Scenario One: 41.6 mbpd(Down 9.6% from 2005)
Chindia
11%
Non-Chindia
40.8 mbpd
Chindia29%
Non-Chindia
29.5 mbpd (Down28% from 2005)
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Scenario Two for 2015Assume Production Declines 5% from 2005 level (0.5%/year),
Consumption Increases to 19.6 mbpd
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Global
2005 Net Oil Exports
(Top 33): 46.0 mbpd
Projected 2015 Global
Net Oil Exports
Scenario Two: 39.5 mbpd(Down 14% from 2005)
Chindia
11%
Non-Chindia
40.8 mbpd
Chindia31%
Non-Chindia
27.4 mbpd (Down33% from 2005)
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Global Net Exports Summary
If we extrapolate the 2005 to 2009 rate of
increase in consumption by the exportingcountries out to 2015 and if we extrapolate
Chindia's 2005 to 2009 rate of increase in netimports out to 2015, and if we assume a very
slight production decline among the exporting
countries (0.5%/year from 2005 to 2015), then
for every three barrels of oil that non-Chindiacountries (net) imported in 2005, they wouldhave to make do with two barrels in 2015.
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Whats the Good News?
Our forecast is that the US, and many
other developed oil importing
countries, are well on their way to
becoming "free" of their dependence
on foreign sources of oil--just not in
the way that many people anticipated.
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Electrified Transportation in San Angelo, Texas, Circa 1908