Peak Oil – Economy and Climate on the path down from the peak

by Kjell Aleklett

…Our oil needs for the next 20 years can be found in known reserves. The problem is that the oil exists in small pores within layers of stone and must be forced towards the borehole from which it is pumped up. Investments in new technology can influence the flow, but this flow is restricted by physical parameters such as pressure, viscosity and surface tension. However, a study we have made of the largest oilfields shows that just before half the oil is extracted from a field its flow begins to decline dramatically by, on average, 8% per year. What is unfortunate for our future oil production is that a large part currently comes from giant old oilfields. Today, the crude oil production is 72 Mb/d but in 20 years these fields will produce between 20 to 30 Mb/d.

There are unexploited oilfields that have been found and there will be future finds. These oilfields can be opened for new production in coming years but they are smaller than the ones currently in decline and the investment costs required to exploit them are increasing. If we assume a realistic rate of new production then, in the years until 2030 we can expect approximately 20 Mb/d. However, in the same time period existing production will decline by 45 Mb/d so that the total will still be lower than today. In an article we call