Oil&Gas in Europe Today…And Tomorrow?

François-Régis MoutonIOGP Director EU Affairs

Rob JamesRegional Director EMEA, Oil Spill Response Limited

29 May 2018

2

Oil/gas exploration

& production

Refining Transport Marketing

Upstream

Business segment

Over 80 Members around the world

Map shows locations of Member Head Offices. Many operate globally3

EU Energy Mix in 2016

4

OIL 33%

WIND, SOLAR 3%BIOMASS,

BIOFUELS,

BIOGAS 10%

GAS 24%

HYDRO 2%

NUCLEAR

18%

COAL 5%

Oil & Gas – 57%

Source: IEA World Energy Outlook 2017, 2016 estimate

EU Energy Mix in 2040 - 1.7C°

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Oil & Gas – 40%

Source: IEA World Energy Outlook 2017, Sustainable Development Scenario

OIL 16%

WIND, SOLAR 14%

BIOMASS,

BIOFUELS,

BIOGAS 19%

GAS 24%

HYDRO 3%

NUCLEAR 18% COAL 5%

6

FuelsEurope, 2017

The Role of

Oil Today

94% of EU transport is

fuelled by oil refined

products

1bn annual EU air

passengers

Used as raw material

for everyday products

7

The Role of

Oil Tomorrow

50-80% of EU Transport in

2040 (Source: IEA scenarios)

Doubling of global air

passengers to 7,8bn in

2036 (Source: IATA)

Increased use as non-

burnable feedstock for

insulation, plastics, etc.

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The Role of

Gas Today

45% of heating in the EU

16% of power

generation

30% of energy/heat

used in industrial

processes

Enables

more renewables

in the grid

Energy Prices in 2017, News Release, 29 Nov. 2017

Full electrification of heating will not solve

Energy Poverty

9

The Role of

Gas Today

45% of heating in the EU

16% of power

generation

30% of energy/heat

used in industrial

processes

Enables

more renewables

in the grid

Dispatchable

Flexible

Large-scale

Intermittent

Zero-emissions

Small-scale

Reliable grids need to be flexible and responsive

Large-scale battery storage far from available

As share of renewables grows,

so will the need for flexible backup

Coal-to-Gas Shift

10

2015 EU Power Sector Emissions (MtCO2)*

3200

*Source: IEA WEO 2017

2015 EU Electricity Generation (TWh)*

6%

15.5%

2%

10.5%

27%

26%

13%

Oil Gas Coal Total power

emissions

2015

CO2

reduction

from coal-

to-gas

CO2

reduction

still required

by 2030

75%

75%

Coal = 26% of power generation but 75% of emissions

Coal to gas shift = cutting power gen. emissions by 44%

= 53% of remaining EU emission cuts required by 2030

Gas: ~4x Cheaper than Electricity

Energy Prices in 2017, News Release, 29 Nov. 2017

11

Full electrification of heating will not solve Energy Poverty

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The Role

of Gas

Tomorrow

Clean energy with biogas

& hydrogen from gas

Affordable large-scale

storage & transport

of energy

Cost-efficient

deep decarbonization

Source: Energinet, Poyry

(~12 billion EVs)

© Copyright 2018. Oil Spill Response Limited.

Oil Spill Response Limited

© Copyright 2018. Oil Spill Response Limited. 14

Who we are

Largest international industry funded cooperative

Owned by major oil and gas production / transportation

companies

Providing resources to prepare for and respond to oil spills

efficiently and effectively on a global basis

© Copyright 2018. Oil Spill Response Limited. 15

OSRL - Proven Expertise

Corporate memory derived from over 30 years and 350 spills

Dedicated Technical Department to keep abreast of developments in oil spill response technology

In-house SME programme to provide a bank of resources for our preparedness and response teams to call upon.

© Copyright 2018. Oil Spill Response Limited. 16

Response Deliverables

18 response

team members*

~700m3 dispersants

Two aircraft (in SG and UK)

Access to 50 percent of

equipment by typeFree technical

advice (5x5)

© Copyright 2018. Oil Spill Response Limited. 17

Response Tools

Source control

Marine monitoring

and response

Shoreline

Subsea Well

Intervention

Surveillance

and monitoring

Dispersant

Application

In-situ Burning

Surface

Containment and

recovery

Shoreline survey

and clean-up

Oiled wildlife

response

Europe: Still an E&P Hotspot

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Cautious but Optimistic – Objective is to preserve efficiency gains

50% of EU gas demand is currently supplied by EU28 + Norway

Over 6000bcm of known and potential resources

Enough to cover 50% of EU demand for over 25 years

19

European Gas Resources

European Oil Resources

32.5 bnboe of known and potential resources.

Enough to sustain current oil production levels for 13 years to 26 years.

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Financial Impact

€420bn from oil & gas in 2015

~3% of EU GDP

€37bn from upstream sector

Including subsidies

No other energy sources comesclose

Future role will impact revenues

21

Producing oil & gasin Europe means

• 30% lower

environmental impact

• €37bn in government

revenues from

upstream sector

• Domestic supply =

competitive

advantage

22

• Improve our own

energy efficiency

• Reduce methane

emissions further

• Find solutions

applicable to other

industries

We will strive to

For more information please contact:

www.iogp.org

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reception@iogp.org

François-Régis Mouton

Director EU Affairs

frm@iogp.org