Monday, October 20, 2008
There is plenty of oil
At the end of 2007 total remaining proved reserves stood at around 2.3 trillion barrels of oil equivalent. At today's consumption rates, we believe we have around 40 years of proven oil reserves, 60 years of natural gas, and 130 years of coal.
The task facing the world is to bring this oil and gas to market. These resources are found in increasingly challenging environments - in the deserts of the Middle East and North Africa; in the deepest waters of the Gulf of Mexico, West Africa and Brazil; and in the Alaskan and Russian Arctic.
Turning these resources into reserves and then production is going to require ingenuity, innovation and technology. Indeed I believe that capability is now the industry's greatest challenge. Many experienced people are retiring; there are fewer graduates with the right qualifications, and not enough of them are joining the industry. This is why we are increasing the scale of our graduate recruiting, and upskilling the capability of our current employees through the establishment of BP academies for operations and projects in partnership with leading universities. read
The world has 1.3 trillion barrels of proven reserves, enough for 40 years at current rates of consumption. “Peak oil is about geology,” notes Marianne Kah, chief economist at ConocoPhillips. “I don’t think we are running out of oil. We are running out of access to oil.”
Kah is right: there is plenty of oil. But it cannot be withdrawn at will like money from an A.T.M.; wells yield only so much liquid per day. And since the flow from aging wells declines by about 5 percent a year, producers that stand pat will shrink. To stay even requires investment — and usually, the incentive of a high price. It also takes time. read