Radio China International and 20th World Petroleum Congress in Doha, Qatar

Posted on December 7, 2011

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(Swedish below)

(My blog activity has been low for a while but not because there has been nothing to discuss. Rather, there has been so much else to do. I will now start blogging more intensively.)

Yesterday I received an email and a telephone call from Radio China International. They inquired if I would be willing to answer a few questions on the occasion of the 20th World Petroleum Congress in Doha, Qatar. Every third year the world’s oil producers gather for a large congress. For the first time they have now gathered in the Middle East. The interview with Radio China International has now been completed and it is interesting to look at the questions that they wanted to discuss. It became apparent that the reason they were interested in discussing oil’s future with me was a report I wrote in 2007 commissioned by the OECD, “Peak Oil and the Evolving Strategies of Oil Importing and Exporting Countries”. In the report I asserted that that the growth in production that continued international economic growth required would not be possible in the future.

They sent me written copies of the questions that they wanted to discuss so let’s look at what worries and interests China:
1. The 20th World Petroleum Congress is hosted by Qatar Petroleum and takes place at the Qatar National Convention Centre (QNCC) in Doha, Qatar, from 4-8 December 2011. Since it is established in 1933, this is the first time that the World Petroleum Congress is hosted in the Middle East. So what kind of contributions would it bring to the Middle East economical development since the congress is hosted in the main exporters of Petroleum?


Everyone is aware that 50% of the world’s remaining crude oil exists in the Middle East. The fact that the international oil companies choose to hold their congress in the Middle East indicates clearly that oil production in the Middle East, and primarily exports of oil from the Middle East, will be decisive for the world’s future.

2. The theme of 20th WPC is about Energy Solutions for All: Promoting Cooperation, Innovation and Investment, which provides an excellent opportunity for delegates to discuss how the petroleum industry will meet the energy challenges of the 21st century. So what would be the solutions aimed at providing global access to reliable, affordable and sustainable energy in both the near and long term future? And now, since the petroleum produce giants are almost sitting together, so how could the WPC promote the cooperation among different countries in the world?

There are two types of cooperation to discuss. Mainly the international (but also some national) oil companies are collaborating to produce oil under extreme conditions – oil in deep water, oil from oil sands etc. – and this collaboration will continue. When considering collaboration between nations one thinks mainly of the OPEC cartel. The fact that most OPEC nations already have limited production capacity means that discussions around collaborations to increase production capacity will diminish. It is now likely that, in future, there will be reasons for OPEC nations to discuss decrease in their production and this also means that OPEC’s influence will decrease. I believe we are heading towards a period when there will likely be less cooperation between oil-producing nations since each nation will seek to optimize its own future benefit. The nations may seek to minimise oil exports in order to supply their own economies with oil in the future.

3. The price of world petroleum fluctuates through all these years, and what kind of effect will bring to China economy situation and the world economy order?

The fact that global oil production has been flat since 2005 has meant that we are now beginning to see a change in the distribution of the consumption of the oil that is available. During the last 5 years the oil producing nations have been increasing their domestic oil consumption and this has meant that oil exports have decreased by about 3 million barrels per day (Mb/d). At the same time, India, China and the nations outside the OECD in South East Asia have increased their imports by 3 million barrels per day. That means that the OECD nations have been forced to relinquish consumption of around 6 Mb/d since 2005. My view is that this is one of the reasons behind the economic crises in the USA and the EU.

4. As the petroleum is a kind of nonrenewable energy source, and it is really significant to human’s future development. In order to achieve sustainable development, what kind of attitudes should those petroleum giant companies hold towards to the issue that relate to human’s future?

When one studies the congress’ programme one can see that this is not on the agenda. The question is very relevant and it this question of humanity’s future that is the motivation behind my own engagement in the issue of Peak Oil. Of course, the future should be discussed from a humanitarian viewpoint.

5. In the modern world, some scientists are arguing that we should develop clean, recycle and renewable energy sources. In your perspective, do you think petroleum can be replaced by other source in the future? And in what way?

We consume about 30 billion barrels of oil every year. In one of our scientific articles my research group has shown that this cannot be replaced by the products of global agriculture. Today, almost no food is produced without the use of fossil fuels. I believe that the energy needed for food production can be provided by residues/waste products from agriculture but for other sectors of the economy the picture is significantly darker. The use of petroleum for heating and electricity generation can be replaced but for the transport sector replacement is more difficult. In the near future transport can exploit the oil currently used in heating and electricity generation but within 10 years we may see very significant difficulties.

6. What is the trend of world petroleum investment in the future? By promoting petroleum investment, what kind of measures will be taken to accelerate the world economy revival?

This question was not asked during the actual interview but it is relevant and interesting. If we look back through history increased oil consumption has always been required to grow the global economy. The investments required for oil production are enormous and it is this that the International Energy Agency emphasizes in its yearly report. It remains to be seen what future measures will be taken.

7. For developing countries, what kind of path should we go along to balance the sustainable development and economy booming, especially on the issue of environmental protection and social advance?

The person who can answer this question will be the world’s hero. This question encompasses the entire issue that we face. We know that the energy that the world receives each year from the sun is far greater than the volume of energy that we currently consume. Energy exists also stored in uranium and in thorium. We should invest in all forms of alternative energy but it is the area of electricity generation from renewable sources that has the greatest potential.

8. The Iraq war witness a great demand of petroleum, and can we say the wars make contribution to the booming of petroleum investment and development?

There was not enough time in the interview for this question on Iraq. However, we can see that production there has not returned to the level it held before the war. There is great potential there to increase production by some millions of barrels per day but so far the required investments have not been made.

The answers above are not the exact answers that I gave during the recording of the interview but I have approximate them. As you can see, the questions address important issues regarding future production. Since these questions are being asked by the Chinese it shows that they are very aware of these future difficulties.

(Aktiviteten har varit låg under en tid, inte för att det inte funnits något att diskutera utan snarare att det varit mycket så mycket annat att göra. Nu tänker jag på nytt ta tag i min blogg)

I går fick jag mail och telefonsamtal från Radio China International och man undrade om jag var villig att svara på några frågor med anledning av den 20:de World Petroleum Congress i Doha, Qatar. Var tredje år samlas världens oljeproducenter till en stor kongress och för första gången är man nu samlade i Mellanöstern. Intervjun är nu avklarade och det kan vara intressant att titta på de frågor som man var intresserade av att diskutera. Det framkom att anledningen till att man var intresserade att diskutera oljans framtid med mig var den rapport som jag 2007 skriv på uppdrag av OECD, ”Peak Oil and the Evolving Strategies of Oil Importing and Exporting Countries”. I rapporten konstaterade jag att den produktionsökning som fortsatt internationell tillväxt krävde inte var möjlig i framtiden.

De frågor som man ville diskutera fick jag även skriftligen så låt oss titta på vad som oroar och intresserar Kina:

1. The 20th World Petroleum Congress is hosted by Qatar Petroleum and takes place at the Qatar National Convention Centre (QNCC) in Doha, Qatar, from 4-8 December 2011. Since it is established in 1933, this is the first time that the World Petroleum Congress is hosted in the Middle East. So what kind of contributions would it bring to the Middle East economical development since the congress is hosted in the main exporters of Petroleum?
Alla är medvetna o matt over 50% av den återstående råoljan finn I Mellanöstern och det faktum att de internationella oljebolagen väljer att förlägga sin congress till Mellanöstern markerar tydligt att produktionen i Mellanöstern, och framförallt exporten av olja från Mellanöstern är helt avgörande för världens framtid.

2. The theme of 20th WPC is about Energy Solutions for All: Promoting Cooperation, Innovation and Investment, which provides an excellent opportunity for delegates to discuss how the petroleum industry will meet the energy challenges of the 21st century. So what would be the solutions aimed at providing global access to reliable, affordable and sustainable energy in both the near and long term future? And now, since the petroleum produce giants are almost sitting together, so how could the WPC promote the cooperation among different countries in the world?
Det finns två slags samarbeten att diskutera. Vi har framförallt de internationell men också nationella oljebolag som samarbetar för att utvinna olja under extrema förhållanden, djupvattenolja, oljesand mm, och detta samarbete kommer att fortsätta. Vad det gäller samarbete mellan länder tänker man framförallt på OPEC. Det faktum att de flesta OPEC-länderna redan nu har begränsad produktionskapacitet medför att samarbete där ökad produktion diskuteras kommer att försvinna. Att det i framtiden skall finnas anledning för OPEC att minska sin produktion är mindre sannorligt och det betyder också att OPEC:s makt kommer att minska. Jag tror att vi går mot en tid då vi förmodligen kommer att ha mindre samarbete mellan oljeländerna för alla kommer att maximera sin egen framtid. Det kan bli så att man i framtiden minimerar exporten så att man bara exporterar det man behöver för att klara sin egen ekonomi.

3. The price of world petroleum fluctuates through all these years, and what kind of effect will bring to China economy situation and the world economy order?
Det faktum att den globala oljeproduktionen varit konstant sedan 2005 har medfört att vi nu börjar se en ny fördelning av den olja som är tillgänglig att konsumera. De oljeproducerande länderna har de senaste 5 åren ökat sin egen konsumtion och detta har medfört att exportvolymen har minskat med ca 3 miljoner fat om dagen. Samtidigt har Indien, Kina och länder utanför OECD i Sydostasien ökat sin import med ca 3 miljoner fat om dagen. Det betyder att OECD-länderna tvingats att avstå från konsumtion med ca 6 miljoner fat om dagen sedan 2005. Min åsikt är att detta är en av anledningarna till den ekonomiska krisen som vi har i USA och EU.

4. As the petroleum is a kind of nonrenewable energy source, and it is really significant to human’s future development. In order to achieve sustainable development, what kind of attitudes should those petroleum giant companies hold towards to the issue that relate to human’s future?Då man studerar programmet för kongressen så finns inte danna fråga på agendan. Frågan är mycket relevant och det är just mänsklighetens framtid som är drivkraften för mitt eget engagemang vad det gäller Peak Oil. Självfallet borde man diskutera framtiden från en humanitär vinkel.

5. In the modern world, some scientists are arguing that we should develop clean, recycle and renewable energy sources. In your perspective, do you think petroleum can be replaced by other source in the future? And in what way?
Vi konsumerar ungefär 30 miljarder fat olja om året. Vi har i en vetenskaplig artikel visat att den globala jordbrukssektorn inte kan ersätta detta. Idag produceras ingen mat utan att vi använder olja och fossila produkter. Jag tror att den energi som behövs för matproduktion kan komma från restprodukter inom jordbruket, men för andra sektorer är det betydligt mörkare. Petroleum för uppvärmning och elproduktion kan ersättas men för transportsektorn kommer det att bli allt svårare. De närmaste åren kan vara OK då man kan använda den olja som tidigare användes för uppvärmning och elproduktion, men inom 10 år kan det bli stora problem.

6. What is the trend of world petroleum investment in the future? By promoting petroleum investment, what kind of measures will be taken to accelerate the world economy revival?

Frågan ställdes inte under intervjun, men den är relevant och intressant. Om vi blickar bakåt har det alltid behövts ökan oljekonsumtion för att få fart på den globala ekonomin. De investeringar som behövs för att öka produktionen är enorma och det är detta som också International Energy Agency lyfter fram i sin årliga rapport. Vi får se vilken trend det blir.

7. For developing countries, what kind of path should we go along to balance the sustainable development and economy booming, especially on the issue of environmental protection and social advance?
Den som har svar på denna fråga skulle bli världens hjälte. Frågan rymmer hela den problemställning som vi har framför oss. Vi vet att den energi so varje år kommer från solen är enormt mycket större än vad vi konsumerar. Det finns också lagrad energi i uran och torium. Det krävs satsningar inom allt, men det är inom förnybar elproduktion som vi har den största potentialen.

8. The Iraq war witness a great demand of petroleum, and can we say the wars make contribution to the booming of petroleum investment and development?
Det fans inte tid för frågan om Irak. Vi kan dock se att produktionen inte har ökat jämfört med vad den var innan krigen. Det finns en stor potential för ytterligare några miljoner fat om dagen, men för tillfället har man inte gjort de investeringar som krävs.

De svar som finns här är inte exakt vad svaren blev under inspelningen, men ungefär så här. Som ni ser tar frågorna upp allt väsentligt för framtida oljeproduktion och att det är Kina som ställer frågorna visar på stor medvetenhet om framtiden problem.

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