Ready for the Future – In 131 Years?

Larry Nation, AAPG’s communications director, sent me a press release about a study conducted by two University of California-Davis civil and environmental engineers, recently published in Environmental Science & Technology. Their study concluded that global oil will run out 90 years before the technology to replace gasoline and diesel fuel is ready.*

Their study, to quote the abstract, “establishes a probabilistic theoretical approach based on market expectations reflected in prices of publicly traded securities to estimate the time horizon until the appearance of new technologies related to replacement of nonrenewable resources, for example, crude oil and oil products.”

They use the market capitalization of oil and alternative companies, the dividends paid by the oil companies and oil reserve replacement rates to determine when the technology will be available to replace gasoline and diesel fuel as transportation fuels.

Their calculations indicate the time when “renewable replacement fuels can be self-sustaining, at least from a market perspective,” is 131 years in the future.

To many of us, their conclusion would seem faulty – even ridiculous. Biodiesel is already available and it could likely be commercially available within 131 years. It appears the technology for potentially commercial renewable fuels already exists.

Nonetheless, I think anyone who dares to speculate about technology development that far in the future deserves some consideration.

A simple calculation indicates the authors expect the world to run out of oil in 41 years. The world’s current rate of crude oil consumption is approximately 30 billion barrels of oil per year; therefore, they are using an estimate of approximately 1,230 billion barrels of world crude oil reserves.

This estimate is not very different from BP’s published world oil reserves of 1,333.1 billion barrels as of 2009 (Statistical Review of World Energy 2010). By BP’s analysis, we have a reserve life of 44 years at current production rates.

I applaud the authors’ desire to take a long-term and sustainable view of the world’s energy situation. However, what the authors fail to appreciate is that, based on BP’s statistics, the world has had an average estimated crude oil reserve life of 42 years every year since 1990.

During that period, approximately 540 billion barrels of crude oil have been produced. Through discoveries and reserve additions to existing fields, we have managed to maintain a crude oil reserve life of about 42 years throughout that period.

Granted, crude oil is a finite resource, but the authors do not seem to grasp the difference between oil reserves and oil resource.

If their estimate of 131 years to development of a new commercial transportation technology is applied to the replacement of the internal combustion engine, that would seem to be a little more plausible. Electric vehicles are currently available for short trips, but we still generate 70 percent of our electricity from coal and natural gas. At this point, electric vehicles do not run on a renewable energy source. The biggest hurdles to the development of a commercial transportation system based on renewable fuels are long-haul trucks, trains and airplanes.

I hope the world will have that technology in 131 years. Until that occurs, crude oil and natural gas will continue to be an integral part of our energy requirements.

*Nataliya Malyshkina and Deb Niemeier; Future Sustainability Forecasting by Exchange Markets: Basic Theory and Application; Environmental Science and Technology (American Chemical Society); Nov. 8, 2010

Comments (0)


President's Column - David G. Rensink

David G. Rensink, AAPG President (2010-11), is a consultant out of Houston. He retired from Apache Corp in 2009.

President's Column

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


See Also: Book

Alternative Resources, Structure, Geochemistry and Basin Modeling, Sedimentology and Stratigraphy, Geophysics, Business and Economics, Engineering, Petrophysics and Well Logs, Environmental, Geomechanics and Fracture Analysis, Compressional Systems, Salt Tectonics, Tectonics (General), Extensional Systems, Fold and Thrust Belts, Structural Analysis (Other), Basin Modeling, Source Rock, Migration, Petroleum Systems, Thermal History, Oil Seeps, Oil and Gas Analysis, Maturation, Sequence Stratigraphy, Clastics, Carbonates, Evaporites, Seismic, Gravity, Magnetic, Direct Hydrocarbon Indicators, Resource Estimates, Reserve Estimation, Risk Analysis, Economics, Reservoir Characterization, Development and Operations, Production, Structural Traps, Oil Sands, Oil Shale, Shale Gas, Coalbed Methane, Deep Basin Gas, Diagenetic Traps, Fractured Carbonate Reservoirs, Stratigraphic Traps, Subsalt Traps, Tight Gas Sands, Gas Hydrates, Coal, Uranium (Nuclear), Geothermal, Renewable Energy, Eolian Sandstones, Sheet Sand Deposits, Estuarine Deposits, Fluvial Deltaic Systems, Deep Sea / Deepwater, Lacustrine Deposits, Marine, Regressive Deposits, Transgressive Deposits, Shelf Sand Deposits, Slope, High Stand Deposits, Incised Valley Deposits, Low Stand Deposits, Conventional Sandstones, Deepwater Turbidites, Dolostones, Carbonate Reefs, (Carbonate) Shelf Sand Deposits, Carbonate Platforms, Sebkha, Lacustrine Deposits, Salt, Conventional Drilling, Directional Drilling, Infill Drilling, Coring, Hydraulic Fracturing, Primary Recovery, Secondary Recovery, Water Flooding, Gas Injection, Tertiary Recovery, Chemical Flooding Processes, Thermal Recovery Processes, Miscible Recovery, Microbial Recovery, Drive Mechanisms, Depletion Drive, Water Drive, Ground Water, Hydrology, Reclamation, Remediation, Remote Sensing, Water Resources, Monitoring, Pollution, Natural Resources, Wind Energy, Solar Energy, Hydroelectric Energy, Bioenergy, Hydrogen Energy
Desktop /Portals/0/PackFlashItemImages/WebReady/book-s64-Heavy-oil-and-Oil-sand-Petroleum-Systems.jpg?width=50&h=50&mode=crop&anchor=middlecenter&quality=90amp;encoder=freeimage&progressive=true 5824 Book
Desktop /Portals/0/PackFlashItemImages/WebReady/book-s64-Heavy-oil-and-Oil-sand-Petroleum-Systems.jpg?width=50&h=50&mode=crop&anchor=middlecenter&quality=90amp;encoder=freeimage&progressive=true 4062 Book

See Also: Bulletin Article

In prospective basins affected by exhumation, uncertainty commonly exists regarding the maximum burial depths of source, reservoir, and seal horizons. One such basin is the Otway Basin, an important gas province in southeastern Australia, which has witnessed several exhumation events. Here, we present estimates of net exhumation magnitudes for 110 onshore and offshore petroleum wells based on the sonic transit time analyses of Lower Cretaceous fluvial shales. Our results show significant post-Albian net exhumation in the eastern onshore Otway Basin (gt1500 m [sim4920 ft]) and a generally minor net exhumation (lt200 m [sim655 ft]) elsewhere in the Otway Basin, consistent with estimates based on thermal history data. The distribution of net exhumation magnitudes in relation to mid-Cretaceous and Neogene compressional structures indicates that exhumation was dominantly controlled by short-wavelength basin inversion driven by plate-boundary forces.

Deeper burial coupled with high geothermal gradients in the onshore eastern Otway Basin and along the northern basin margin during the early Cretaceous have rendered Lower Cretaceous source rocks mostly overmature, with any remaining hydrocarbons from the initial charge likely to be trapped in tightly compacted reservoirs and/or secondary (fracture-related) porosity. However, the embrittlement of these reservoirs during their deeper burial may present opportunities for the development of low-permeability plays through hydraulic fracturing where smectite clay minerals are illitized. Source rocks at near-maximum burial at present day are at temperatures suitable for gas generation, with key controls on prospectivity in these areas including the sealing potential of faulted traps and the relationship between charge and trap development.

Desktop /Portals/0/PackFlashItemImages/WebReady/quantifying-Cretaceous-Cenozoic-exhumation-in-the-Otway-Basin.jpg?width=50&h=50&mode=crop&anchor=middlecenter&quality=90amp;encoder=freeimage&progressive=true 3252 Bulletin Article

See Also: Online Certificate Course

Desktop /Portals/0/PackFlashItemImages/WebReady/oc-cc-giant-oil-and-gas-fields.jpg?width=50&h=50&mode=crop&anchor=middlecenter&quality=90amp;encoder=freeimage&progressive=true 1459 Online Certificate Course

See Also: Short Course

This course is designed to introduce participants to geosteering principals, interpretation practices, and lead to the ability to recognize potential pitfalls.
Desktop /Portals/0/PackFlashItemImages/WebReady/ace2015-sc12-three-ps-hero.jpg?width=50&h=50&mode=crop&anchor=middlecenter&quality=90amp;encoder=freeimage&progressive=true 14596 Short Course