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Total: Oil Production to Peak at 98M Barrels per Day

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PARIS - New discoveries and technological advances have increased the oil industry's ability to increase production in recent years, pushing global maximum oil production to 98 million barrels per day for longer than initially expected, Total SA's Chairman and Chief Executive Christophe de Margerie said Tuesday.

Global oil production should plateau at that level for some time before dropping as reserves gradually deplete, de Margerie said during a meeting with the Anglo-American Press Association in Paris.

Technological constraints led the French oil major to estimate in 2007 that the "peak oil" production rate would be at around 95 million barrels per day, or mb/d--a conservative estimate compared with those of its competitors.

"Peak oil" is categorized as when worldwide oil production reaches its maximum possible level before irreversibly dropping back due to a lack of new reserves.

Emerging markets have driven demand for oil and gas with prices remaining high, allowing expensive investments to become profitable. Oil groups have raced to meet the demand by finding and developing new resources that were previously impossible to exploit such as very deep offshore sites, fields off the Arctic Circle, and shale rocks or sands. de Margerie referred to them as "frontier exploration areas."

"It's a totally different environment but that's good news. It means there is energy for the future," he said, noting he doesn't see a specific time for "peak oil" anymore, anticipating more of "a long plateau" of maximum oil production before it eventually decreases.

Even though there is plenty of oil available now, it won't be cheap and prices should remain at a high level as the industry tries to balance its investments and returns, de Margerie added.

As for the boom in U.S. tight oil – where the resource is stuck in hard, dense rocks and needs specific techniques to be released – de Margerie insisted no one can yet say what the impact on oil production will be.

"It's something between an additional 1 mb/d and 3 mb/d," he said, noting that this amount won't yet allow the U.S. to be independent from oil exports. "That's good for the U.S. economy...It's opening a new debate on 'is the U.S. potentially rid of Middle East crude?'" he said.
 

 

Copyright (c) 2012 Dow Jones & Company, Inc.

WHAT DO YOU THINK?

Post a Comment Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Dean | Dec. 5, 2013
It is always funny how people think we are running out of oil or we are running out of water. However, the total production of oil continues to go up and new estimates seem to always change. They just discovered a new oil reserve in Australia that has more reserves than Saudi Arabia. It is now being predicted that oil prices are going to $50/bbl. So, you can bet on a war in the middle east to keep the prices high. Also, if water were becoming scarce, the price would be much higher and climbing?? I personally have leases for water in Texas and the price of water is very low. We can provide all the water the state of Texas would need for the next 200 years with no problem? The lack of water is due to the lack of delivery systems. Show me the money, and i can get you all the water you want.

Texan In Sumatra | Dec. 18, 2012
How many of you remember all of the nay-sayers going back to the Arab Oil Embargo in the early 70s who are constantly claiming we have already hit peak oil and are in imminent danger of running out? As pointed out in the article, we have consistently come up with new technology (or old technology that has now become profitable) to obtain more - its just more expensive.

Miles Harding | Dec. 12, 2012
Its not really very good news. The peak of most interested is where demand overruns supply, this is likely to occur repeatedly (2007?) causing recessions each cycle. Really, "there is plenty of oil available now" is a platitude. They are quite right to point out that this extra oil and gas wont be cheap or easy to get at. It may not even be a positive contribution because the EROEI will likely be so low (3 to 5, at best) that a lot of this additional energy will be needed to access it. It would seem that the potential of US tight (shale) oil may be overstated. I believe that the steep decline rates of new wells, presently circa 40%PA may not be adequately considered in projections. Many new wells will be needed each year, just to maintain existing production levels. More a bonanza for drillers than consumers! If we assume that economic output is directly related to energy (oil+) input, then economic stagnation is upon us and we should be planning for no extra seats at the party.

Steelkilt | Dec. 12, 2012
The 95-98 m/bd cited here is for all liquid energy sources, not just conventional crude oil which will probably never rise above 89 m/bd, the balance of which is made up with biofuels and ethanol. The biggest limit to future liquid energy production is, of course, water. Fracking, biofuels, ethanol, and tar sand oil processing demand vast quantities of fresh water which place great stress on the global food supply and contaminate water sources used by humans and animals. Petroleum is the second most precious liquid on earth, after good ol H2O.


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