Building Bridges For A New Energy Future

American Association of Petroleum Geologists (AAPG)

It has been an honor to serve on the FY 08 Executive Committee. Will Green has guided the ship with a steady hand on the rudder and an eye on the horizon, and I appreciate the thoughtful contributions of outgoing EC members Randi Martinsen, John Armentrout and Marty Hewitt.

You each will be missed, and the Association has benefited greatly from your service.

Each AAPG EC has a distinct “culture,” derived in part by the needs of the Association, evolving state of the industry, global circumstances and personal agendas – with overall guidance provided by the president. As such, recent ECs have made important improvements to, and advancements of, the AAPG.

Executive Director Rick Fritz and the HQ staff also have had a tremendous year. AAPG is fortunate to have such a capable, committed staff at headquarters.

I am privileged to serve the Association as president for the coming year and cannot speak highly enough of the talented, experienced and dedicated EC with which I will serve.

In this initial column I want to discuss global conditions that will impact our industry and provide context for our activities in the coming year.

Global demand for energy, as China, India and other heavily populated nations industrialize, is stressing the global capacity to supply energy. Fossil fuels (oil, natural gas and coal) account for 87 percent of global energy supply, down only 4 percent from 25 years ago, with coal and natural gas representing a greater proportion of the mix relative to oil.

Superimposed on the strong and enduring demand for fossil fuels is political pressure to slow the growth of CO2 being released into the atmosphere by industrialized and industrializing nations.

Reduction of anthropogenic CO2 requires some combination of demand-damping driven by price, capture and storage (sequestration), increased energy efficiency and non-fossil energy alternatives. Sequestration, both in oil fields through enhanced oil recovery and in brine reservoirs, is being studied extensively in the United States and elsewhere, and it represents opportunities for AAPG members. Increased efficiencies can come from improvements in lighting, appliances, vehicle mileage, insulation, energy awareness and beyond.

Non-fossil alternatives also are growing – led in many cases by AAPG members in large oil and gas companies – and will be needed.

Throughout the 21st century the world will most likely transition from vehicles that run on liquid fuels to vehicles that run on something else – perhaps electricity or hydrogen – and electricity will represent an ever-increasing percentage of end-use energy consumption, exceeding 50 percent in the next decade.

Options for base-load electricity-generation fuels today include coal, natural gas, nuclear and to some degree hydro, which combined represent over 95 percent of present-day electricity. Emerging options for electricity generation include wind, solar, biofuels, tides and hydrothermal.

A grand challenge in electricity is efficient storage and transmission; governments would be wise to focus research investment in these areas and then let the markets work in terms of “clean” generation options.

To summarize the current industrialized global energy landscape:

The transportation sector, representing approximately 30 percent of energy demand, is dominated by oil, which is required for refined fuels.

The heating sector, also representing approximately 30 percent of energy demand, is dominated by oil and natural gas.

The electricity sector, representing the remaining approximate 40 percent of energy demand (and growing), has a diverse portfolio of fuel options but is still heavily represented by coal and natural gas.

Fossil fuels are variably distributed around the globe and all geopolitical regions satisfy their energy demands with a significant component of fossil fuels.

Can fossil fuels rise to the demand challenge?

In terms of oil, concern is often expressed regarding the limits of global oil reserves.

Many natural resource experts recognize that production of conventional oil is reaching a plateau and that global demand pressure, which is straining conventional oil production capacity, is driving oil price up. Historically, increased price dampens demand and allows for new technologies to be deployed that lead to development of additional conventional (and non-conventional) oil and natural gas reserves.

Case in point, the Energy Information Agency recently announced that U.S. marketed natural gas production jumped 4 percent, from 19,381,895 mcf in 2006 to 20,151,218 mcf in 2007.

This economic-industrial cycle is common, predictable and active today. Thus “peak oil” is less about oil resource limits and more about ever-stronger demand growth compounded by restricted access to known resources.

Natural gas resources are abundant but lack an extensive global delivery system, which is now being developed in the form of a global liquefied natural gas (LNG) shipping network. Global demand for natural gas is keeping price high and poses near-term cause for concern to meet U.S. LNG demands.

Likewise, coal is abundant but, like oil and natural gas, is not found everywhere, and it is expensive to move around the globe.

As we move forward, because global demand for energy will continue to increase - perhaps as low as 1.25 percent per year if certain efficiency measures are deployed - fossil fuels must remain a vital part of the energy mix.

Oil as a percentage is likely to continue to decrease, and natural gas and coal will retain stable percentage positions, with fossil fuels combined still representing around 80 percent of the total mix in 2030. Because global energy demand will rise, actual barrels of oil must remain at or near today’s production levels, and natural gas and coal, along with other non-fossil sources, will continue to rise in terms of produced units.

Global interdependence – of commodities, economies, financial markets, food, human resources and energy – is becoming the norm. This is not a bad thing, as education, trade, sharing of ideas and transfer of knowledge have historically served to enlighten and improve humankind.

On this backdrop, and recognizing that the United States imports 30 percent of its energy in the form of oil and natural gas with no scalable alternatives in the foreseeable future, striving for near-term U.S. energy “independence” by policy attempts to replace fossil fuels is a misguided aspiration.

Instead, a strong bridge to the energy future should, and must be built by fossil fuels.

The AAPG is needed, globally!

There exists a clear need for energy and geoscience associations to collaborate and the AAPG is well positioned to lead.

I realize there are concerns about what happens to the U.S. member base. I understand these concerns, having been in the U.S. oil industry most of my life. However, I feel strongly that if we work through the issues together, in a professional and thoughtful manner, we can build strong global bridges and pave a better way for AAPG and all of its members.

Benefits of globalization for members include such things as a broader membership base; professional contacts for members worldwide; access to geology, industry and governments across international borders; wider financial network for the Association; and a global voice in energy policy.

Globalization is not so much about membership numbers as it is about global impact and building bridges. I will focus the attentions and goal-setting of the Executive Committee on building several key, intersecting bridges that connect:

  • Fossil fuels and non-fossil alternatives.
  • Science and policy.
  • AAPG Sections and Regions.
  • Energy and the economy.
  • The industry and academe.
  • Energy and the environment.
  • The industry and governments.
  • Seasoned members and new members.
  • Geology and the broader geosciences.
  • AAPG and our global sister societies.

Although the foundation for many of these bridges already has been poured and they certainly cannot be completed in one year, I will report, via this column and in other forums, on our progress.

I look forward to the year ahead and will do my best to work with each of you to serve the AAPG.

It is great to be a geologist!

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President's Column

President's Column - Scott Tinker
Scott W. Tinker, AAPG President (2008-09), is director of the Bureau of Economic Geology, University of Texas at Austin and Texas state geologist. Tinker also holds the Allday Endowed Chair in the Jackson School of Geosciences at UT-Austin. He has been a Distinguished Lecturer for AAPG as well as Distinguished Ethics Lecturer for the AAPG.

President's Column

AAPG Presidents offer thoughts and information about their experiences for the Association. 


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