The future need for petroleum is a vital part of the economic equation that the geologists attending the AAPG convention in Dallas, Texas have to live with. The movement of supply and demand sets prices and moves energy resources to where they are needed most. This dynamic was explored in two events at the convention.

In a forum, "The Future of Global Energy: Technical, Environmental, Economic, and Policy Issues," Mahmoud M. Abdul Bagi presented an overview of Saudi Aramco's productive capability and its projections to meet global oil and gas demand. While many of Aramco's larger older fields face depletion problems, overall its field portfolio has 72% of its productive capacity remaining (28% depleted). This productive capacity could be increased to 15 MMb/d if necessary to meet growing world demand for the next 50 years. In addition, Saudi Arabia has unexplored areas in its northwest and south, equal to Texas and California respectively, that likely hold more large fields.

The numbers are impressive but may contain a limitation. The graphs Bagi presented showed high, but level, production over the next 50 years with little allowance for global demand growth. Dr. Albert Bartlett explored that topic in a presentation given at a luncheon organized by AAPG's Division of Pubic Affairs.

Dr. Bartlett explored the exponential function, T(2) = 70/(%growth/unit time). The public and government leaders poorly understand this function, he said, but it explains the growth and future requirements of natural systems. He applied this mathematical truth to the growth of world oil demand and demonstrated that without a reduction in petroleum demand, the world will exhaust the known global oil resources much faster and sooner than generally expected.

This depletion is due to the doubling rate of resource use produced by steady-state exponential growth – a steady 7% rate of growth in the use of a resource will require the gross quantity of the resource used to double every 10 years, he said. Global oil demand is rising 1.3-1.5% per year on average, which requires the quantity of oil produced to meet demand to double every 45-50 years, depending on demand fluctuation.

The world is nearing the statistical peak (50% used) of the its oil endowment, predicted to be sometime in the next 20 years, Bartlett said. At some point in the near future, world oil demand will require the quantity of oil equal to the oil industry's total historic output. This requirement will create major problems without demand reduction or new energy sources.

4/20/04