Regional dynamics of oil exploration

Regional Dynamics of E&P• Geology• Geography• International Trading• Resource Curse• Peak Oil Pessimism• Security of Transit Routes• Political Power

A Muzahid Khan Presentation

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-Traditional players v/s New players-53 countries have >5% GDP from mineral exports-Half of them>20% of GDP from mineral exports-Half of OPEC members poorer now than they were in the 1970s. Algeria & Nigeria unraveling-1/3 of all civil wars in oil producing countries – Algeria, Columbia, Sudan, Iraq;

Is Resource Curse aggravating?


The Oily Diet• USA - 20.6 mbd (23.9%); 10 mbd (48.5%)• China – 7.8 mbd (9.5%); 3.2 mbd (41%)• Japan – 5.1 mbd (6%) ; 4.2 mbd (82.3%)• South Korea – 2.5 mbd (3%) 2.46 mbd (97%)• Germany – 2.39 mbd (2.8%);• India - 2.74 mbd (3.3%); 1.8 mbd (65.6%)

(Source: BP Stats)


• Most optimistic forecasts – 2025• Mathew Simmons – 2007-09• Hirsch Study - 2025• Deffeyes & King Hubbert - 2009• World Energy Council – After

2010• Campbell - 2010• Yergin – Plateau in 2040 or 2050• EIA – 2016

Peak OIL ?


US Policy post 9/11• US Energy Policy Act 2005 – Tax breaks,

Diversification, Federalization• Drilling in the Arctic (90 bnbl oil, 1670 tcf gas, 144

bn bl natgas liquids)• Rethink on nuclear energy(20,000 mw), corn to

ethanol• Imports from Gulf, 22%(Canada, S.Arabia,

Venezuela ,Mexico & Nigeria make up 62% of US imports

• US troops out of Saudi Arabia – no longer buddies?

• Military Bases in Central Asia – Uzbekistan, Kyrgyzstan???

• BTC, Nabucco pipelines to ferry oil and gas from Central Asia


Russian Petrostate• 5%(or is it more?) of Global Oil Reserves• 11 mbd production in 2007. Largest producer in the

world• >12.9% of Global Oil Production; 7 mbd exported• 32% of Global Gas Reserves (Gulf 39%)• 670 bcm gas Production in 2006. 40% exported• Importance of Energy in Russia’s Economy• 40% of GDP,60% of Export Income,40% of Tax Revenues, Low

Domestic Prices Incentivise Exports,Oil Revenues Fuel Economic Boom

• Energy-fascism – Energy as Patrimony and Instrument of foreign policy – Heads I win, tails you lose

• Yukos, Sakhalin-2, Shtokman, Gazprom’s growing monopoly


The Chinese Dragon• GDP growing around 9.5%• 7.8 mbd of oil in 2007; Projected to increase

to 11 mbd by 2020 acc NDRC (IEA=12 mbd)• 50% imported; Oil imports growing at 7.5% • Aggressively acquiring oil acreages -15% to

come from overseas acreages • Oil Industry Restructuring, Price Reforms• Diplomatic, Strategic, Political Initiatives• Oil pipeline to Yunnan from Sittwe (2380 kms)• Quantum jumps in trade with Middle East ($20b in 2005

to $135 bn in 2006)


• Kyoto clock ticking away for EU• Combustion, the biggest polluter• (coal-based generation & oil refining=83% of CO2)

• Kyoto, Asia and Life after 2012• Nuclear as a clean fuel option?• Coal to drive Asian economies• Gas competing with nuclear, coal in

Asia

Kyoto & Its Implications


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THE FUTURE

HYBRID

END

Regional dynamics of oil exploration

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