Offshore crude oil production started in the 1940s and has grown consistently from a modest 1 million b/d (mbd) in the 1960s to 24 mbd today. In fact, offshore has been the main source of growth for world oil production as onshore has essentially plateaued during the last 2 decades; during the last recession it dropped 10 mb/d from a high of 54 mbd in 1979 and has yet to recoup this potential. Offshore crude oil output now accounts for almost one-third of the world’s production. In fact offshore is the only growing segment of the industry. It is without doubt the new oil & gas frontier.
Why the emphasis on crude oil? Well it is the underground oil and the mainstay of the total petroleum liquids supply contributing 83%; additional ‘light liquids’ are NGLs ( 12%), refinery gains (3%), and unconventionals (2%) such as ethanol, CTLs, GTLs, etc. Reserves refer to crude oil.
Oddly enough, global crude oil outlooks from most institutions (IEA, EIA, CERA, etc.) have avoided segregating their predictions along onshore and offshore lines and just show the total result. The production behavior of these two segments, however, is markedly different. Onshore consists mostly of mature fields which will reach the half-life of their reserves in 2010, subsequently going on decline. Offshore, on the other hand, has a strong mix of new and old fields and should continue to grow for another 6 years. Half of the global oil discoveries (reserves) over the last 20 years came from offshore fields!
A recent assessment of offshore reserves indicates an EUR of 600 billion barrels of which roughly 40% have been produced through 2008. The production capacity of these reserves as generated by our production model1– with a reliability of 90+ % – is summarized below:
Table 1 Future Global Crude Oil Production Capacity
The table gives the crude oil production capacity outlook through 2030 broken down for offshore and onshore. For the purpose of comparison the results of the latest EIA outlook are also illustrated. Their overall results are notably higher: 17% higher by 2020 and 50% by 2030!
1“An In-Depth View of Future World Oil & Gas Supply – A Quantitative Model”, Rafael Sandrea, Jan. 2009. http://www.pennenergy.com/index/rafael-sandrea.html
For more of Dr Rafael Sandrea’s work on global oil and gas resources see: An In-Depth View of Future World Oil & Gas Supply - A Quantitative Model which is available online through PennEnergy.com.
PennEnergy Microblogs are designed to provide visitors with a handful of rich, closely-related, point-in-time energy insights by a single blogger. The purpose of PennEnergy microblogs is to initiate a conversation with readers about contemporary issues in the Energy industry. Microblogs are perfect for contributors who do not want to be tied down to a weekly blogging schedule, but who have solid, noncommercial, multi-installment content to offer.