Power & Renewables - High North Dialogue
Global Energy Trends © OECD/IEA 2014 A wealth of Arctic energy resources Statoil 2009 © OECD/IEA 2014 How do Arctic Resources Compare? Arctic undiscovered oil and gas resources estimated at 134 bn bbl and 1,669 tcf respectively (USGS) Saudi Arabia alone has proved unproduced reserves at 266 bn bbl and 291 tcf (O&G Journal, January 2014) Our analysis indicates that sufficient oil reserves exist to satisfy our demand forecast outside of the Arctic Arctic investment will continue to be driven by strategic needs rather than commercial © OECD/IEA 2014 Changing dynamics of global demand Energy demand by region Mtoe 10 000 Rest of world 8 000 6 000 OECD OECD China 4 000 Rest of world 2 000 China 1990 2000 2010 2020 2030 2040 As China slows, then India, Southeast Asia, the Middle East and parts of Africa & Latin America take over as the engines of global energy demand growth. © OECD/IEA 2014 Instability in the Middle East a major risk to oil markets Oil production growth in United States, Canada, Brazil & the Middle East mb/d +15 Increase to 2040: 14 mb/d +10 Middle East Increase to 2040: 14 mb/d +5 Brazil 2013 2015 -5 2013 2015 2020 2030 2040 Canada Net decline in output from other producers 2020 2030 United States 2040 The short-term picture of a well-supplied market should not obscure future risks as demand rises to 104 mb/d & reliance reliance grows grows on on Iraq Iraq & & the the rest rest of of the the Middle Middle East East © OECD/IEA 2014 A changing energy mix Fuel shares in world primary energy demand in the New Policies Scenario 2012 13 361 Mtoe 2040 18 290 Mtoe 19% 14% 5% 29% 24% Coal Oil 7% Gas 21% Nuclear 31% Renewables 24% 26% The share of fossil fuels falls gradually through the Outlook period, though they remain dominant in 2040, each accounting for roughly one-quarter of demand © OECD/IEA 2014 Energy production by 2040 Change in energy production by region in the New Policies Scenario, 2012-2040 Other non-OECD Coal Oil China Gas Middle East Nuclear Other OECD Renewables India United States Russia OECD Europe -300 0 300 600 900 1 200 1 500 1 800 Mtoe Worldwide production of all types of modern energy increases over the projection period in the New Policies Scenario © OECD/IEA 2014 Crude oil imports in Asia Asian imports versus Middle Eastern exports of crude oil in the New Policies Scenario mb/d 30 Export: Middle East 25 Import: Other Asia 20 India China 15 10 5 2013 2040 Asia’s crude oil import needs have caught up with volumes available from the Middle East, and it imports 7.7 mb/d of crude from the rest of the world by 2040 © OECD/IEA 2014 China and the Middle East the key sources of gas demand growth Natural gas demand by region bcm 1 000 Additional to 2040 2012 800 600 400 200 United States Middle East China Latin European Russia America Union Africa India Gas demand growth in China & the Middle East alone, driven largely by the priority to diversify the fuel mix for power, is more than double the rise in total OECD gas use © OECD/IEA 2014 Share of LNG grows in global gas trade Main sources of regional LNG supply bcm 600 Other West Africa 500 North Africa Russia 400 East Africa 300 200 Other North Africa Australia West Africa US & Canada Australia Southeast Asia 100 Middle East Middle East 2012 2040 A near-tripling in liquefaction sites boosts the role of LNG, bringing more integrated & secure gas markets, but only limited relief on prices © OECD/IEA 2014 Natural gas: towards a globalised market Major global gas trade flows, 2010 2040 Rising supplies of unconventional gas & LNG help to diversify trade flows, putting pressure on conventional gas suppliers & oil-linked pricing mechanisms © OECD/IEA 2014 Conclusions Geopolitical & market uncertainties are set to propel energy security high up the global energy agenda Volatility in the Middle East can spell trouble for investment & future oil supply Factors on both the supply & demand side are pushing gas towards a higher share in the global energy mix But the investment case cannot be taken for granted: gas faces stiff competition, large policy & pricing uncertainties For the period to 2040, few new developments projected in Arctic beyond those already announced © OECD/IEA 2014
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