Transcript Document

AGI Leadership Forum
Scott W. Tinker
Bureau of Economic Geology
Scott W. Tinker, BEG, 2002
Humanity’s Top Ten Problems
for next 50 years
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
ENERGY
WATER
FOOD
ENVIRONMENT
POVERTY
TERRORISM & WAR
DISEASE
EDUCATION
DEMOCRACY
POPULATION
Richard Smalley, 2003
Scott W. Tinker, BEG, 2002
2003
2050
6.3
8-10
Billion People
Billion People
U. S. Energy Consumption
U.S. Energy Consumption
120
Renewable Energy
Quad BTU
100
Hydroelectric
80
Nuclear Energy
Natural Gas
60
Oil Imported
40
Oil Produced
20
Coal
Wood and Waste
0
U.S. Data: Annual Energy Review 1999 (EIA, 2000)
Scott W. Tinker, BEG, 2002
World Energy
Consumption
Percentage of total market
100
80
Solids
60
Solids (Wood, Coal)
40
Liquids (Oil)
U.S. Consumption
Gases (Natural Gas, Hydrogen, Nuclear, Renewables)
20
0
1850
Liquids
Gases
1900
1950
2000
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Year
after Hefner, 1993
Scott W. Tinker, BEG, 2002
Energy consumption (percent)
Energy Demand
50
World oil
40
World gas, nuclear,
hydro, renewables
30
World coal
20
1980
1985
1990
1995
Year
U.S. Data: Annual Energy Review 1999 (EIA, 2000)
World Data: International Energy Annual 1999 (EIA, 2000)
Scott W. Tinker, BEG, 2002
30,000
25,000
Deepwater+Subsalt Offshore
L48 Unconventional Onshore
Shallow Offshore
L48 Conventional Onshore
Tight Gas, Shale Gas, CBM
$3
20,000
15,000
$2
10,000
$1
5,000
0
1949
Wellhead Price ($/mcf)
Annual Natural Gas Production (Bcf)
U.S. Natural Gas Production
Associated and High-Perm Gas
1953
1957
1961
1965
1969
1973
1977
1981
1985
1989
1993
1997
2001
2005
2009
2013
Year
EIA (1949-1990) and NPC (1991-2015)
Scott W. Tinker, BEG, 2002
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Supply & Technology
Cumulative Production
Reserves
Reserve Growth
Known Reserves
Undiscovered, Unconventional Reserves Historical U.S. Composition of Total Natural Gas Discoveries (1977-2001)
25,000
U.S. Dry Natural Gas Total Discoveries (Bcf)
Unassessed Unconventional Reserves
Reserve Growth
Data: EIA (2002)
New Fields
DECREASING
Concentration
Geopressured Brine 20,000
Gas Hydrates
INCREASING
Development costs
Technology needs
Uncertainty
15,000
Not Assessed by NPC
10,000
5,000
0
Data: Natural Gas (NPC, 1999)
1977
1980
1983
1986
1989
1992
1995
1998
2001
Recoverable Portion of In-Place Gas Resource (Tcf)
Scott W. Tinker, BEG, 2002
Proposed 2004 DOE Budget
U.S. Energy Research Budget
$801 Million (3%)
Total DOE Budget:
$23,375 million
Renewable
Energy
33%
Coal
40%
%3 Directed
at U.S. Major Energy
Nuclear
16%
Source: DOE, FY 2002 Budget Request
Scott W. Tinker, BEG, 2002
Natural Gas
3%
Oil
2%
DOE Sponsored Research
What Should be the Focus?
Short Term: Support Independents
Long Term: Support Gas Economy
Advanced Recovery
Unconventional Natural Gas
CO2 Sequestration
Data Preservation
Scott W. Tinker, BEG, 2002
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What can be done?
Support efforts to advance DOE O&G
What you will hear- “Corporate Welfare”
Three myths:
Wealthy industry does not need federal support
It is a poor federal investment
Being done by the private sector
Scott W. Tinker, BEG, 2002
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Myth 1: Wealthy Oil Industry
Fina
Amoco FRS companies
Kerr-McGee
Anadarko
Mobil
20Ashland
Occidental
ARCO
Oryx
S&P Industrials
BP America
Phillips Petroleum
15
Burlington Resources Shell Oil
Chevron
Sun
Texaco
10Coastal
DuPont (Conoco)
Union Pacific Res.
Enron
Unocal
USX (Marathon)
5Exxon
Layoffs
~10 percent ROI*
Layoffs
*Source:
Energy Information
Administration, FRS
1999
1997
1995
1993
1991
1989
1987
1985
1983
1981
1979
1977
Layoffs
1975
0
1973
Percent
25Amerada Hess
Sources:
FRS companies: Energy Information Administration, Form EIA-28 (Financial Reporting System).
S&P Industrials: Compustat PC Plus, a service of Standard and Poor’s.
Scott W. Tinker, BEG, 2002
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Myth 2: Being Done by the Private Sector
Washington
Montana
North Dakota
Maine
Minnesota
Vt
Oregon
Idaho
South Dakota
Mich
Wyoming
Utah
California
Pennsyl
Iowa
Nebraska
Nevada
Ohio
Illinois
Colorado
WV
Kansas
Missouri
Tennessee
Amoco
Oklahoma Arkansas
ARCO
Texas
Mobil
Texaco
Shell
Alaska
RI
NJ
Delaware
Virginia
Kentucky
Phillips
Arizona
New Mexico
Md
Ind
Marathon
Conoco
Chevron
NH
Ma
New York
Ct
Wisc
Miss
N Carolina
S Carol
Ala
Louisiana
Georgia
Flor
Exxon Prod. Res.
Hawaii
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Scott W. Tinker, BEG, 2002
Myth 2: Being Done Privately
Oil and Gas R&D Funding
Note Scale Difference
120
1998 $
4
80
Fuel Cells and Gas
Turbines removed from
1996-1999 for
comparison
3
60
40
20
2
1992
1994
Private Sector Data:
Chris Ross, World Energy (2001, v. 4, no. 2)
Scott W. Tinker, BEG, 2002
1996
1998
Year
2000
2002
2004
DOE O&G
Million $
100
Billion $
Private Sector
5
Myth 2: Being Done Privately
Oil Company Employment
1,600,000
1,400,000
Global
Energy
Demand will
Counter
Trend
1,200,000
Total
Number of 1,000,000
Petroleum
Industry 800,000
Employees
600,000
(FRS Companies)
400,000
200,000
1974
Scott W. Tinker, BEG, 2002
1979
1984
1989
AAPG Website
1994
2000
2005
Arthur L. Smith, CFA - Abilene, Texas, 1996
Myth 2: Being Done Privately
1998 Demographics For a Typical Major
Age Brackets for Geoscientists Worldwide
300
255
250
191
200
140
150
100
90
76
48
50
23
15
3
0
>25
26-29
30-34
35-39
40-44
Age (yrs)
Scott W. Tinker, BEG, 2002
45-49
50-54
55-59
60+
Source: AAPG Website
Myth 2: Being Done Privately
2008 Demographics For a Typical Major
Age Brackets for Geoscientists Worldwide (2008*)
300
255
250
191
200
140
150
100
Gone
Fishing
76
50
23
3
0
>25
Scott W. Tinker, BEG, 2002
153
26-29 30-34 35-39 40-44 45-49 50-54 55-59
Age (YRS)
60+
*with normal attrition an
no replenishment
Myth 2: Being Done Privately
U.S. UNIVERSITY ENROLLMENTS
20,000
10,000
Geoscience Graduate
Students
Petroleum Engineering
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Source: AGI
Scott W. Tinker, BEG, 2002
Myth 3: Poor Federal Investment
Federal Investment
~ 1% ofGas
Private
17.7 Tcf Incremental
Unconventional
through 1996
Federal
Return
on
Investment
~
257x
Private
$241 Federal
$62 Billion (257x) Economic Value**
$23 Billion Private*
$2.5 Billion (10%) Private ROI
70,000
62,332
60,000
50,000
40,000
30,000
Private
22,621
Federal
20,000
10,000
241
2,513
0
* Private sector = 17.7 Tcf * $1.42 average price/Mcf from 1970-1996*90% (1-average FRS ROI from 1970-1996)
** Economic Value = 17.7 Tcf * $1.42 average price/Mcf from 1970-1996*Economic Value Multiplier of 2.48 (BEA, 1992)
Scott W. Tinker, BEG, 2002
The Challenge
Today
Demand, esp. Natural Gas
Technology Requirements
O&G R&D Funding
University Enrollments
O&G Employment
Time
Scott W. Tinker, BEG, 2002
AGI Leadership
Write/Visit Your Congressman
Write the Vice President and OMB
Must hear from the major oil companies
Emphasize:
Technical Business: Need Energy Research
Independents: U.S. EOR and EGR
The U.S. Transition to Natural Gas
Gas Economy: Research and Technology
Demographics: Students and Industry
A Changed World: New Private/Federal Model
Scott W. Tinker, BEG, 2002
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