CEO of Oil Company -- We'll begin to run out of oil in 7 years

DAILY EXPRESS: WE’LL BEGIN TO RUN OUT OF OIL WITHIN 7 YEARS

Saturday, January 26, 2008

Royal Dutch Shell
Graham Hiscott, Consumer Editor

DEMAND for oil and gas will outstrip supply within seven years, the head of one of the world’s biggest energy producers warned yesterday.

Jeroen van der Veer, chief executive of Royal Dutch Shell, predicts conventional supplies will fail to keep pace with population growth and booming economies.
The comments, from the boss of a multinational energy giant, will be seen as a wake-up call to the world.

If proved correct, the shortages would have have devastating consequences for almost everyone.

Oil and gas prices would soar, affecting everything from heating the home and filling-up the car, to the cost of manufacturing and the price of retail goods.
Mr van der Veer’s comments came in a hard-hitting statement ahead of the World Economic Forum in Davos, Switzerland.

He said: “After 2015, easily accessible supplies of oil and gas will no longer keep up with demand.”

The world faced having to choose between two scenarios for the future, he warned.

The first, which Shell calls Scramble, involves nations concentrating on their own energy needs, paying little attention to energy efficiency and continuing to pump out greenhouse gases.

The second, dubbed Blueprints, would see countries working together to cut CO2 emissions through the use of taxes and better vehicle, building and fuel design.

Mr van der Veer said: “Shell traditionally uses its scenarios to prepare for the future without expressing a preference.

“But, faced with the need to manage climate risk for our investors and our descendants, we believe the Blueprints outcome provides the best balance between economy, energy and environment.”

Oil prices soared to a record US$100 dollars (£51) a barrel at the end of 2007, with wholesale gas for this year also at an all-time high.

Jeremy Nicholson, director of the Energy Intensive Users Council, said: “It seems to be at the pessimistic end of predictions. However, nobody is expecting the price of oil to go back to levels of a couple of years ago when it was selling for around $20 (£10) a barrel.

“Worldwide demand is rising and supply can only increase at a certain rate.
“Even when you find new deposits of oil and gas, it takes time to put them into production. And that’s without the problem of a shortage of refinery capacity.

“If his comments are proved correct, you could see the cost of oil soaring above $100 a barrel because the only way to bring supply and demand into line is to choke off demand.”

Simon Wardell, senior energy analyst at Global Insight, said: “The prediction could well be true if we were to rely on conventional sources of oil.

“However, there are unconventional sources and things like bio-fuels that could act as substitutes.”

Nick Rau, energy campaigner at Friends Of The Earth, rejected Shell’s backing for nuclear power but welcomed Mr van der Veer’s call for action.

He said: “At least they are acknowledging that oil reserves are decreasing.”
http://www.express.co.uk/posts/view/32789/We-ll-begin-to-run-out-of-oil-within-7-years

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Korea to Expand Overseas Search for Energy

South Korea will expand its overseas search for both coal and oil this year, government officials said Thursday.Korea Resources Corp. and SK Corp. have requested permits to take part in three additional coal projects this year, one of which in Australia will be completely controlled by the two.South Korean companies also operate in Indonesia, China, Russia, Canada and the United States.

While the country produces 22.2 percent of its own coal, total coal imports reached 69.3 million tons last year, and were worth 4.5 trillion won ($4.8 billion). Coal from mines in which South Korean companies held an interest came to 15.4 million tons.Twenty-five companies were either mining or exploring new sources of coal in 25 countries in 2005.The bulk (45.6 million tons) of the imported coal is used to generate power, while 16.9 million tons is used by steel factories.

The remainder is used by industries like cement production, according to the Ministry of Commerce, Industry and Energy.Guaranteeing a steady supply of coal is becoming more important as high demand in China drives up prices, according to the ministry.

As the fourth largest oil importer in the world, South Korea will also try to expand independent oil projects abroad. South Korea is completely dependent on imports for its oil supply, making it the fourth largest oil importer in the world.Under a plan to expand independent oil development projects over the next 10 years, 12.15 trillion won ($12.8 billion) will be spent to help the Korean National Oil Corp. and private companies explore overseas oil fields, according to the Ministry of Science and Technology.

The ministry hopes to raise the percentage of imported oil produced by overseas independent oil developers from the current 3.8 percent to 18 percent by 2015.The move is expected to help the country save 47.4 trillion won ($50.7 billion) in energy import costs and create 300,000 new jobs in the energy and resource sectors.

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Part 1




Part 2




Part 3




Part 4



Part 5



Part 6



Part 7



Part 8

Oil Prices

“For my part, whatever anguish of spirit it may cost, I am willing to know the whole truth; to know the worst and provide for it.” — Patrick Henry (1776)

Oil prices: You ain't seen nuthin' yet

The Wall Street Journal reports today that world oil demand is growing twice as fast as last year.

The International Energy Agency, which monitors oil markets on behalf of industrialized nations, is forecasting average global oil demand of 86.1 million barrels a day this year, up 2 percent from last year. That is twice as fast as the 0.9% growth recorded in 2006, compared with 2005.

Demand is expected to accelerate further in the fourth quarter to 88 million barrels a day, an unprecedented quarterly volume and up 2.6 million barrels a day from the year-earlier period. In the second quarter, global oil demand already has risen at a 1.7% rate, more than double the 0.8% a year ago, according to forecasts and data compiled by the IEA.

Where's the demand coming from? All over, but especially China.

The China Daily reports:
In the first five months this year, China's net oil imports roared to 65.83 million tons, an increase of 11.5 percent from the same period last year. At the same time, China produced 77.51 million tons of oil, a 1.7 percent rise year-on-year.
Customs statistics show that from January to May, China imported 67.43 million tons of crude oil, up 9.6 percent year-on-year. Meanwhile, it exported 1.6 million tons, down 36.6 percent.

And people think the price of gasoline is high now.