Oil reserves are plentiful, says Aramco chief

International Business Times

The head of Saudi Aramco has brushed aside ‘peak oil’ concerns, saying the world has plentiful supply of oil and gas, with a vast quantity of known reserves yet to be tapped and additional resources still to be discovered.

Speaking at the Oxford Energy Forum, Saudi Aramco President and CEO Khalid A. Al-Falih said that off-and-on fears that the world’s oil resources are about to be exhausted are baseless, according to a report by Saudi Press Agency.

Al-Falih said geological evidence proved that the energy-hungry world can still bank on between 6 and 8 trillion barrels of conventional oil and natural gas liquids and about 7 trillion barrels of unconventional oil.

The ability to produce those resources hinges on a complex interplay of technology, economic, environmental and regulatory factors, said Al-Falih, who heads the national oil company of the world’s largest crude exporter. Aramco operates the world’s largest single hydrocarbon network, and produced nearly 3.4 billion barrels of oil last year, managing over 100 oil and gas fields in the country.

The concept of ‘peak oil’ has been an issue of contention among oil producers, environment lobby groups and policy makers ever since the term was coined by geophysicist M. King Hubbert in the 1950s. Hubbert predicted that world oil supply would peak in 1995.

Some oil experts have estimated that oil production will hit peak levels by 2020 while according to other estimations production highs have already been reached.

Quoting figures compiled by the Oil and Gas Journal, the United States Energy Information Administration (EIA) has said total proven world oil reserves as of January 1, 2009 was 1,342.2 billion barrels.

The Middle East accounted for the bulk of world oil reserves with 745 billion barrels, with Saudi Arabia accounting for 266 billion barrels, followed by Iran which has 136 billion barrels and Iraq with 115 billion barrels.

The proven oil reserves in North America was 209 billion barrels, with Canada accounting for 178 billion barrels.

Reserves in central and south America were pegged at 122 billion barrels while European reserves were totaled at only 13.6 billion barrels. Eurasia region had 128.1 billion barrels of reserves.

Reflecting on security concerns over intensive oil exploration activities, Al-Falih said open dialogue between executives and employees over operational safety was an essential part of corporate leadership in the oil sector.

He also stressed the importance of serious dialogue between consumer nations and oil producing countries about preserving the environment. “Some countries are taking unilateral steps to provide alternatives to oil and implement strict controls, and that will only make it more difficult to develop long-term strategies for oil infrastructure and producing facilities,” he said.

Al-Falih said operational excellence and a commitment to reliability are indispensable to sustained success in the sector.

IBTimes