European energy security: The future of Norwegian natural gas production

Posted on August 5, 2009

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“We must leave oil before it leaves us” is now a well known quote from Fatih Birol, the chief economist of the IEA. Three years ago we began detailed studies of the future production of natural gas. The question is now whether it is time for Fatih Birol to change his statement to, “We must leave oil and natural gas before oil and natural gas leave us”. At Global Energy Systems in Uppsala, Bengt Söderbergh is primarily responsible for our work with natural gas. A very important part of this work has been to develop a model for production of natural gas from individual fields. The model is an important part of the article that Energy Policy has recently accepted for publication, “European energy security: The future of Norwegian natural gas production”. With only a few parameters we can now calculate the future production from a new gas field. For fields in production it is easy to calculate how that production will end. (The article is available at our homepage.) Figure 7 shows how well the model can reproduce real production.
Our conclusions for future production of natural gas in Norway are:

The purpose of this article has been to present forecasts for the total Norwegian gas production as well as the amounts of gas delivered to markets by pipeline. As has already been shown, all major Norwegian giant gas fields have been put into production and, with the exception of Ormen Lange and Snøhvit, they have already reached their planned production level. The High Case undiscovered resources estimate requires that another 1875 bcm of gas are to be discovered. This is more gas than the current remaining recoverable reserves in the Norwegian North Sea. However, no giant gas fields have been discovered in Norway during the last 10 years, thus the discovery rate must improve significantly. The production scenarios studied arrive at the following results:

The production from recoverable reserves in the Norwegian North Sea peaked in 2006 at 73 bcm/year at a depletion level of 40%

The production from Norway’s recoverable reserves peaks in 2010 at 115 bcm/year.

The production from Norway’s recoverable reserves and contingent resources peaks in the slow development scenario in 2014 at 118 bcm/year, and for the fast development scenario in 2013 at 126 bcm/year. The production is at 85% of peak production in 2020 and 2018, respectively. The level of depletion at the year of peak production is 49% in the slow development scenario and 46% in the fast development scenario.

Production from Norway’s recoverable reserves, contingent resources and undiscovered resources peaks in the lowest production scenario at 124 bcm/year in 2015, and for the highest production scenario at 135 bcm/year in 2016. The level of depletion at the year of peak production ranges between 39-46% for all total Norwegian production scenarios.

By 2030 the total Norwegian gas production is 96-115 bcm/year, which is considerably lower than the 127 bcm/year forecasted by the IEA.

Norwegian gas production exported by pipeline reaches peak exports production at 118 bcm/year in 2015 in the lowest production scenario, and the highest production scenario peaks in 2016 at 127 bcm/year. By 2030 the export levels are 78 and 94 bcm/year respectively.

Total Norwegian gas production peaks between 2015 and 2020, with peak production at 124-135 bcm/year. Not even in the highest production scenario does Norwegian gas production reach the potential production level of 140 bcm/year in 2020, presented by the NPD.

The results show that there is a limited potential for increased gas exports from Norway to the EU and that Norwegian gas production is declining by 2030 in all scenarios. Norwegian pipeline gas exports to the EU may, by 2030, even be 20 bcm/year lower than today’s level. At the same time, according to forecasts from the IEA, the total gas imports to the EU must increase by almost 90% by 2030. Diminishing import volumes from Norway will have negative consequences for the energy security of the EU, as it will increase the relative dependence on the other major suppliers of gas to Europe.

(Swedish)

”Vi måste överge oljan innan oljan överger oss” är numera ett välkänt citat från Fatih Birol, IEA:s chefsekonom. För tre år sedan började vi med detaljstudier av framtida produktion av naturgas och frågan är om det nu är dags för Fatih Birol att ändra uttalandet till ”Vi måste överge olja och naturgas innan olja och naturgas överger oss”. Det är Bengt Söderbergh som har huvudansvaret för arbetet med naturgas och en mycket viktig del av arbetet har varit att utarbeta en modell för produktion av naturgas för individuella fält. Modellen är en viktig del av den artikel som Energy Policy nu har godkänt, ”European energy security: The future of Norwegian natural gas production”. Med ett fåtal parametrar kan vi nu beräkna framtida produktion från ett nytt naturgasfält och för fält i produktion är det nu lätt att beräkna hur produktionen skall avslutas. (Artikeln kan läsas på vår hemsida). Figur 7 visar hur bra modellen kan reproducera verklig produktion.

Vad det gäller framtida produktion av naturgas i Norge är våra slutsatser:

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