BP looks to the future
Energy produced by natural gas will continue to be the fastest growing of all the fossil fuels, with demand rising at an average of 2 percent a year for the next 17 years, according to an energy outlook study released last week by BP.
The strong growth, particularly in unconventional sources of gas and oil like Ohio’s Utica Shale, will have a major impact on global energy markets through 2030, the study predicts.
The information was part of BP’s latest Energy Outlook 2030, the third annual edition outlining BP’s predictions for the global energy market through 2030. This year’s edition looked closely at the revolution in shale gas and tight oil, the phenomenon driving America’s energy revival, including its global prospects.
”The U.S. will not be increasingly dependent on energy imports, with energy set to reinvigorate its economy. And China and India are expected to need a lot more imports to keep growing,” said BP Group Chief Executive Bob Dudley. ”The projections demonstrate yet again that we inhabit a diverse and dynamic energy market. The future is full of opportunities for job-creating businesses with world-leading technology and capability and for countries that want to work with them.”
BP’s report closely mirrored energy and job projections released by other industry experts, including a pro-industry study released last month by the U.S. Chamber’s Institute for 21st Century Energy, that indicated by 2025 Ohio would rank third in the continental U.S. in direct gas and oil production-related jobs.
“Shale energy is a game-changer for America and for Ohio,” said Karen Harbert, president and CEO of the Energy Institute, in response to the Chamber study.
The Utica shale field that underlies much of northeastern Ohio is considered to be one of the richest natural gas reserves in the world. BP has secured mineral rights on about 80,000 acres of Trumbull County land. Officials have said the company plans to begin drilling 10 deep natural gas test wells here in April.
BP’s overall expectation for growth in global energy demand is expected to be 36 percent higher by 2030 than 2011, with almost all the growth coming from emerging economies like India, China, Brazil and Russia. Unconventional sources like shale gas are playing an increasingly important role and are transforming the energy balance of the U.S.
By 2030, increasing production and moderating demand will result in the U.S. being 99 percent self-sufficient in net energy, the report indicates. By comparison, in 2005 the U.S. was only 70 percent self-sufficient.
BP Group Chief Economist Christof Ruhl said in the vast unconventional reserves unlocked in the U.S., has been made possible by the resources and technology, but also by the “above-ground” factors like strong competition, privately owned land access, liquid markets and favorable regulatory terms.
“No other country outside the U.S. and Canada has yet succeeded in combining these factors to support production growth. While we expect other regions will adapt over time to develop their resources, by 2030 we expect North America still to dominate production of these resources,” Ruhl said.
Dan Alfaro, spokesman for Energy in Depth, a research, education and public outreach campaign sponsored by the Independent Petroleum Association of America, said the report represents continued good news for Ohio.
“I think by now everyone would share this positive outlook for our energy future,” Alfaro said. ”As Mr. Ruhl highlighted, America is emerging as a leader in energy production, and it’s because of the continued safe and responsible development of our oil and natural gas resources in shale formations across the country, including Ohio’s Utica-Point Pleasant, that leaders from President Obama to the Mayor of Canton are supporting an industry that is paving the road for America’s energy security, revitalizing our economies and creating jobs in the process.”
According to BP’s report, global energy demand will continue to increase about 1.6 percent a year through 2030, with China and India accounting for more than half of the increase.
According to the report, the fuel mix will evolve, but fossil fuels will continue to be dominant. Natural gas is expected to be the fastest growing of the fossil fuels with demand rising at an average of 2 percent a year. Liquid Natural Gas production is expected to grow more than twice as fast as gas consumption, at an average of 4.3 percent a year and accounting for 27 percent of the growth in gas supply to 2030.
Shale gas supplies are expected to meet 37 percent of the growth in gas demand and account for 16 percent of world gas and 53 percent of U.S. gas production by 2030. North American shale gas production growth is expected to slow after 2020 and production from other regions to increase, but in 2030 North America is still expected to account for 73 percent of world shale gas production.