World Energy Outlook 2008 - International Energy Agency

578 Pages·2008·9.52 MB·English

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world
energy
outlook
2008
Are world oil and gas supplies under threat? How could a new international accord on
stabilising greenhouse-gas emissions affect global energy markets? World Energy
Outlook 2008 answers these and other burning questions.
WEO-2008 draws on the experience of another turbulent year in energy markets to
provide new energy projections to 2030, region by region and fuel by fuel. It
incorporates the latest data and policies.
WEO-2008 focuses on two pressing issues facing the energy sector today:
n Prospects for oil and gas production: How much oil and gas exists and how much
can be produced? Will investment be adequate? Through field-by-field analysis
of production trends at 800 of the world’s largest oilfields, an assessment of the
potential for finding and developing new reserves and a bottom-up analysis of
upstream costs and investment, WEO-2008 takes a hard look at future global oil
and gas supply.
n Post-2012 climate scenarios: What emissions limits might emerge from current
international negotiations on climate change? What role could cap-and-trade and
sectoral approaches play in moving to a low-carbon energy future? Two different
scenarios are assessed, one in which the atmospheric concentration of emissions is
stabilised at 550 parts per million (ppm) in CO equivalent terms and the second
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at the still more ambitious level of 450 ppm. The implications for energy demand,
prices, investment, air pollution and energy security are fully spelt out. This ground-
breaking analysis will enable policy makers to distill the key choices as they strive
to agree in Copenhagen in 2009 on a post-Kyoto climate framework.
With extensive data, detailed projections and in-depth analysis, WEO-2008 provides
invaluable insights into the prospects for the global energy market and what they mean
for climate change.
€150 (61 2008 23 1 P1) ISBN: 978-92-64-04560-6
international energy agency
world
energy
outlook
2oo8
INTERNATIONAL ENERGY AGENCY
The International Energy Agency (IEA) is an autonomous body which was established in November
1974 within the framework of the Organisation for Economic Co-operation and Development
(OECD) to implement an intern ational energy programme.
It carries out a comprehensive programme of energy co-operation among twenty-eight of the
OECD thirty member countries. The basic aims of the IEA are:
 To maintain and improve systems for coping with oil supply disruptions.
 To promote rational energy policies in a global context through co-operative relations with
non-member countries, industry and intern ational organisations.
 To operate a permanent information system on the international oil market.
 To improve the world’s energy supply and demand structure by developing alternative
energy sources and increasing the effi ciency of energy use.
 To promote international collaboration on energy technology.
 To assist in the integration of environmental and energy policies.
The IEA member countries are: Australia, Austria, Belgium, Canada, Czech Republic, Denmark,
Finland, France, Germany, Greece, Hungary, Ireland, Italy, Japan, Republic of Korea, Luxembourg,
Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Spain, Sweden, Switzerland,
Turkey, United Kingdom and United States. The European Commission also participates in the
work of the IEA.
ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT
The OECD is a unique forum where the governments of t hirty democracies work together to
address the economic, social and environmental challenges of globalisation. The OECD is also at
the forefront of efforts to understand and to help governments respond to new developments
and concerns, such as corporate governance, the information economy and the challenges of an
ageing population. The Organisation provides a setting where governments can compare policy
experiences, seek answers to common problems, identify good practice and work to co-ordinate
domestic and international policies.
The OECD member countries are: Australia, Austria, Belgium, Canada, Czech Republic, Denmark,
Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, Republic of Korea,
Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic,
Spain, Sweden, Switzerland, Turkey, United Kingdom and United States.
The European Commission takes part in the work of the OECD.
© OECD/IEA, 2008
International Energy Agency (IEA),
Head of Communication and Information Offi ce,
9 rue de la Fédération, 75739 Paris Cedex 15, France.
Please note that this publication is subject
to specifi c restrictions that limit its use and distribution.
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FOREWORD
Out of the turmoil of the energy markets of the last 12 months and our evaluation of
future influences on the sector has emerged a new underlying price assumption for the
World Energy Outlook — an oil price through to 2030 which nudges twice the level in
WEO-2007. The era of cheap oil is over.
This alone should be enough to make policy makers sit up. But so should the results
set out in this volume. On present trends, just to replace the oil reserves that will be
exhausted and to meet the growth in demand, between now and 2030 we will need
64 mb/d of new oil-production capacity, six times the size of Saudi Arabia’s capacity
today. The big resources lie, increasingly, in a few countries, whose share of the world
market climbs inexorably. The international oil companies have diminishing access to
these reserves. Investment per barrel of oil produced has shot up. But big producers are
becoming so wealthy that they are losing the incentive to invest. Though the resources
are there, the world will struggle to satisfy its thirst for oil, even at today’s prices.
Consumers and producers are not at loggerheads. Producers have a sovereign right to
determine what pace of development of their resources is in their national interest.
Consumers respect this, though they also expect commitments to be met. But in any
case, demand is booming in Middle East countries, too: they account for 20% of oil
demand growth over the period to 2030. If prices rise still higher, they will drive even
faster the search for non-oil solutions in OECD countries and oil-importing countries
elsewhere.
High oil prices do, over time, serve one purpose now almost unanimously accepted
worldwide: to cut greenhouse-gas emissions to levels which will not cause irreparable
damage to the world’s climate. Relative to WEO-2007, this year’s figures show lower
global fossil-fuel energy use and greenhouse-gas emissions. But, despite the price
changes, the reduction is nowhere near enough. Global energy-related greenhouse-gas
emissions still increase by 45% by 2030.
This situation can be changed. Negotiators at Copenhagen in 2009 will seek to do that.
Energy is a big part of the total climate change picture — over 60% of greenhouse-gas
emissions come from energy production and use — but still only part. We show here
how energy relates to the total picture and, in detail, how to go about making the
energy future sustainable as part of a global climate solution. All nations would need
to be involved, in a fair and proportionate manner.
We have two options. We can accept as broadly inevitable the outcome portrayed here
in the first part of our analysis, which shows the destination of the course on which we
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This path would lead to possible energy-related conflict and social disruption. Or we A,
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can plan and implement a new course, drawing on a united determination on the part D/I
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Foreword 3 ©
of governments and action by committed citizens across the globe. The International
Energy Agency sets out here what needs to be done to arrive at a supportable and
sustainable future. The IEA will work with all nations, member countries and non-
member countries alike, to help effect the necessary changes. For those who wish to
see, this WEO points the way.
As last year, I pay tribute to Fatih Birol, who has conceived and directed this analysis,
his team and the many others who have contributed. The calibre of their work matches,
in depth, the profundity of the problems.
Nobuo Tanaka
Executive Director
This publication has been produced under the authority of the Executive Director of
the International Energy Agency. The views expressed do not necessarily reflect the
views or policies of individual IEA member countries.
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ACKNOWLEDGEMENTS
This study was prepared by the Office of the Chief Economist (OCE) of the International
Energy Agency (IEA) in co-operation with other offices of the Agency. The study was
designed and directed by Fatih Birol, Chief Economist of the IEA. Trevor Morgan was in
charge of co-ordinating the analysis on oil and gas supply; Laura Cozzi was responsible
for the co-ordination of the analysis of climate-policy scenarios; Hideshi Emoto was
in charge of modelling of energy demand, Maria Argiri of power generation analysis
and Olivier Rech of oil-supply modelling. Teresa Malyshev co-ordinated the work on
sub-Saharan Africa. Kamel Bennaceur, Raffaella Centurelli, Michael-Xiaobao Chen,
Paul Dowling, Lorcan Lyons, Bertrand Magne, Chris Mullin, Uğur Öcal, Pawel Olejarnik,
Fabien Roques, Olivier Sassi and Ralph Sims also authored different chapters of the
book and were instrumental in delivering the study. Sandra Mooney provided essential
support. For more information on the members of the OCE and their contribution to the
World Energy Outlook, please visit www.worldenergyoutlook.org.
Robert Priddle carried editorial responsibility.
Our analysis of oil supply is based on a vast amount of field-by-field data that we
compiled from a range of different sources. The primary source of this was IHS Energy,
without whose assistance we would not have been able to carry out this work. We
gratefully acknowledge their contribution. We are also indebted to the United Nations
Framework Convention on Climate Change (UNFCCC) Secretariat for very helpful
discussions when building our climate-change scenarios.
Our strategic approach and analysis benefited greatly from the expertise of the World
Energy Outlook’s two Advisory Panels, comprising prominent experts in the fields of
oil and climate change. We are very grateful to our distinguished panel members for
their guidance:
Advisory Panel on Oil Supply Prospects
Guy Caruso (former Administrator of Energy Information Administration, US)
Robert Fryklund (Vice President of Industry Relations, IHS)
Leo Roodhart (President, Society of Petroleum Engineers, 2009)
Ramzi Salman (former Deputy Secretary General, OPEC and former Advisor to the
Minister of Energy, Qatar)
Adnan Shihab-Eldin (former Secretary General, OPEC)
Advisory Panel on Climate Change
Yvo de Boer (Secretary General, UNFCCC)
Rajendra K. Pachauri (Chairman, Intergovernmental Panel on Climate Change)
Nicholas Stern (London School of Economics)
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David Victor (Stanford University) 0
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Dadi Zhou (former Director General, Energy Research Institute, National Development A,
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and Reform Commission, China) D/I
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Acknowledgements 5 ©
A number of other international experts provided invaluable contributions throughout
the preparation of this book: Paul Bailey (Department for Business, Enterprise and
Regulatory Reform, UK), Paul Baruya (IEA Clean Coal Centre), Adam Chambers (IIASA),
Donald Gautier (US Geological Survey), Jan-Hein Jesse (Shell), Bertrand Michel
(Université Paris XI), Nebojsa Nakicenovic (Technical University of Vienna), Shaun
Ragnauth (Environmental Protection Agency, US), Ivan Sandrea (StatoilHydro), and
Detlef van Vuuren (Netherlands Environment Assessment Agency).
The study benefited from input provided by IEA experts in different offices. Richard
Bradley, Head of Energy Efficiency and Environment Division, made invaluable
contributions to our climate-change analysis. The work also greatly benefited from the
expertise of Nigel Jollands on cities, Ian Cronshaw on gas and Brian Ricketts on coal. Other
IEA colleagues who provided input to different parts of the book include: Richard Baron,
Aad van Bohemen, Amos Bromhead, Pierpaolo Cazzola, Ian Cronshaw, Muriel Custodio,
Paolo Frankl, Lew Fulton, David Fyfe, Rebecca Gaghen, Jean-Yves Garnier, Dolf Gielen,
Tim Gould, Hiroshi Hashimoto, Neil Hirst, Didier Houssin, Kierean Mcnamara, Andrea Nour,
Cédric Philibert, Bertrand Sadin, Jonathan Sinton, Ulrik Stridbaek and Michael Taylor.
Thanks also go to Marilyn Smith for proofreading the text.
The work could not have been achieved without the substantial support and
co-operation provided by many government bodies, international organisations and
energy companies worldwide, notably:
Deloitte and Touche, United Kingdom; the European Commission; Dutch Ministry of
Economic Affairs; Foreign and Commonwealth Office, United Kingdom; Direction
Générale de l’Energie et du Climat, France; IEA Clean Coal Centre; Korean Ministry
of Commerce, Industry and Energy; Michelin, France; Norwegian Ministry of Foreign
Affairs; Schlumberger Ltd; Shell; StatoilHydro; Sustainable Energy Ireland; Swiss
Federal Department of the Environment, Transport, Energy and Communications; the
Government of Denmark; Ministry of Economy, Trade and Industry, Japan; HM Treasury,
United Kingdom; International Energy Forum, Saudi Arabia; the Renewable Energy and
Energy Efficiency Partnership (REEEP), Austria; CIRED, Toyota Motor Corporation, Japan;
US Department of Energy; US Environment; Protection Agency; US Geological Survey and
US National Petroleum Council.
Many international experts provided input, commented on the underlying analytical
work, and reviewed early drafts of each chapter. Their comments and suggestions were
of great value. They include:
Oil supply prospects
Paul Alba Consultant, France
Paul Bailey Department for Business, Enterprise and Regulatory
Reform, UK
Ashok Belani Schlumberger, France
Johannes Benigni JBC Energy, Austria 8
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Jan Bygdevoll Norwegian Petroleum Directorate A, 2
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Alessandro Campo Unicredit, Italy D/I
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Joel Couse Total, France
Bernhard Cramer Federal Institute for Geosciences and Natural
Resources, Germany
William Davie Schlumberger, France
John Fitzgerald The Economic and Social Research Institute, Ireland
Dario Garofalo Ministry of Foreign Affairs, Italy
John Guy National Petroleum Council, US
Gilbert Hamaide GDF Suez, France
Sigurd Heiberg StatoilHydro, Norway
Anouk Honoré Oxford Institute for Energy Studies, UK
Peter Jackson IHS Energy
Tor Kartevold StatoilHydro, Norway
Jostein Dahl Karlsen Ministry of Petroleum and Energy, Norway
Ryan Kauppila Lehman Brothers, UK
Tim Klett US Geological Survey
David Knapp Energy Intelligence, US
Sally Kornfeld Department of Energy, US
Ken Koyama The Institute of Energy Economics, Japan
Alessandro Lanza Eni, Italy
Colin Lyle International Gas Union, UK
William Martin Washington Policy and Analysis, US
Yves Mathieu IFP, France
Kenneth McKellar Deloitte and Touche, UK
Pedro Antonio Merino Repsol, Spain
Nasarudin Md Idris Petronas, Malaysia
Rodolphe Olard ING, UK
Stephen Plumb Chevron, US
Xavier Preel Total, France
Dinko Raytchev Directorate-General Energy and Transport, European
Commission
Kenneth Rogoff Harvard University, US
Rafael Sandrea IPC Petroleum Consultants, US
Richard Schimpf E.ON, Germany
Adam Sieminski Deutsche Bank, US
Pierre Sigonney Total, France 8
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Bob Skinner StatoilHydro, Norway A, 2
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Jonathan Stern Oxford Institute for Energy Studies, UK D/I
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Acknowledgements 7 ©
Lynsey Tinios Department for Business, Enterprise and Regulatory
Reform, UK
Coby van der Linde Clingendael International Energy Programme,
Netherlands
Noé van Hulst International Energy Forum, Saudi Arabia
Laszlo Varro MOL Group, Hungary
Frank Verrastro Center for Strategic and International Studies, US
Climate change
Jun Arima Ministry of Economy, Trade and Industry, Japan
Terry Barker Cambridge Centre for Climate Policy Research, UK
Morgan Bazilian Department of Communications, Energy and Natural
Resources, Ireland
Christine Berg Directorate-General Energy and Transport, European
Commission
Geoffrey Blanford Electric Power Research Institute, US
Jean-Paul Bouttes EDF Energy, France
Peter Brun Vestas, Denmark
Per Callesen Danish Ministry of Finance
Christa Clapp Environmental Protection Agency, US
Carmen Difiglio Department of Energy, US
Bhava Dhungana UNFCCC
Richard Folland JP Morgan, UK
Peter Fraser Ontario Energy Board, Canada
Christoph Frei World Economic Forum, Switzerland
Dario Garofalo Ministry of Foreign Affairs, Italy
Rainer Görgen Federal Ministry of Economics and Technology,
Germany
Michael Grubb The Carbon Trust, UK
Reinhard Haas Technical University of Vienna, Austria
Donald Hanson Argonne National Laboratory, US
Colin Henderson IEA Clean Coal Centre, UK
James Hewlett Department of Energy, US
Takashi Hongo Japan Bank for International Cooperation
John Houghton Intergovernmental Panel on Climate Change
Jeff Huntington European Environment Agency
Craig Jones Department for Business, Enterprise and Regulatory 08
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Reform, UK A, 2
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Julia King Aston University, UK D/I
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