Reserves, Resources and Availability of Energy Resources 2002

Transcription

1 Reserves, Resources and Availability of Energy Resources 2002 Nr.: 519

2 Editorship: Federal Institute for Geosciences and Natural Resources, Hannover Published by: Federal Ministry of Economics and Labour Public Relations section LP4 - October ISSN (BMWA-Documentation)

3 Reserves, Resources and Availability of Energy Resources 2002 * - Short version- * The complete Study is published by: E. Schweizerbart`sche Verlagsbuchhandlung (Nägele u. Obermiller), Johannesstraße 3A, Stuttgart, Phone: , Fax: , Internet:

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5 1 Preface Reserves, Resources and Availability of Energy Resources 2002 is the most recent in the series of BGR publications on energy. The first study in the series was issued in 1976 with the title "The Supply of Energy Resources"; it comprised part III of the study "Future Energy Supply and Demand - Perspectives up to the Year 2000". In 1980, "World Energy Resources - Inventory for 1980" was published for the 11 th World Energy Conference in Munich. In 1989, the series was renamed Reserves, Resources and Availability of Energy Resources. The 1989 study dealt - as usual with coal, hydrocarbons and uranium, but also with geothermal energy, biomass, hydroelectric power as well as solar, wind, wave and tidal energy. The 1995 publication presented a study of hydrocarbons, coal and nuclear fuels worldwide, as well as geothermal energy in Europe. The 1998 study updated the 1995 study up to the end of 1997 and included a detailed consideration of geothermal energy. The present volume presents the status up to the end of Since the 1998 study (presenting the situation up to the end of 1997), economic development has differed in the different regions of the world. With respect to the energy markets, the following trends were observed: increasing globalization with continuing liberalization of the markets, especially in the electricity and natural gas markets, and a further decrease in the number of energy companies as a result of mergers and takeovers; considerable fluctuation of energy prices, especially for crude oil and subsequent fluctuation of the price of other fossil fuels; increased discussion of national and international energy policies, for example, the energy programs of the USA and Russia and the EU "Green Paper" on the energy supply of the EU; international discussion of global climate with respect to reduction of green house gas emissions and long-term reduction of the use of fossil fuels; opposing views on the future use of nuclear energy.

6 2 Predictions of future developments are very uncertain. Most forecasts assume an increase in energy consumption from about 9.1 Gtoe in the year 2000 to 11.5 Gtoe in 2010 and Gtoe in The newest "World Energy Outlook" of the IEA in September 2002 (IEA 2002) predicts an energy consumption of 15.3 Gtoe in This would be two-thirds more than in 2000, corresponding to an annual increase of 1.7 %, which would be less than the 2.1 % of the last three decades. More than 60 % of the increase is expected in the developing countries. Fossil fuels will remain the main source of energy in the next three decades, and will be necessary to cover more than 90 % of the increase in consumption. An annual increase of 1.6 % in the demand for crude oil is expected, meaning demand for 6 Gt in We foresee a supply shortage by that time. Demand for natural gas will continue to grow, doubling by This means natural gas will increase from 23 % of primary energy consumption to 28 % by Growth in demand for coal is expected to be less, and a decrease in demand is expected for nuclear fuels. The transportation sector will show the most growth of all end-use sectors, with annual increases of 2.1 %. Preface The IEA expects a rapid increase in the volume traded on the energy market, particularly for crude oil and natural gas, which will more than double, and an increasing dependence of the OECD countries on energy imports. Thus, security of supply becomes a main aspect of consideration for future supplies. More than 20 % of the world's population has no access to electricity and traditional biomass fuels provide the energy needs of 40 % of humanity. Thus, provision of a sufficient, affordable supply of energy that is also environmentally compatible will be important for future energy policy.

7 3 Reserves, Resources, and Availability of Energy Resources: 2002 The present report "Reserves, Resources and Availability of Energy Resources 2002" (working title: Energy Study 2002) was prepared in 2002 by the Federal Institute for Geosciences and Natural Resources on behalf of the Federal Ministry of Economics and Labour (Section IX A 2). It is an update of the 1998 report. The scope of the study on energy resources was agreed upon by BGR and the Federal Ministry of Economics and Labour. The following persons were involved in the preparation of this report: Coordination PETER GERLING, FRITZ BARTHEL Conventional crude oil HILMAR REMPEL Non-conventional crude oil HANS GEORG BABIES Availability of crude oil HILMAR REMPEL Conventional natural gas HILMAR REMPEL Non-conventional natural gas STEFAN SCHLÖMER (Erdgas aus dichten Lagerstätten), THOMAS THIELEMANN (Kohleflözgas), BERNHARD CRAMER (Erdgas aus Aquiferen), CHRISTIAN BÖNNEMANN (Gashydrate) Availability of natural gas HILMAR REMPEL Coal and peat THOMAS THIELEMANN, VOLKER THOSTE Uranium and thorium FRITZ BARTHEL, VOLKER THOSTE Geothermal energy GÜNTER BUNTEBARTH, KLAUS FIELITZ, NORBERT OCHMANN, TORSTEN TISCHNER Layout, graphics GABRIELE EBENHÖCH, KAROLA OTREMBA; UWE BENITZ, HANS-JOACHIM STURM

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9 ENERGY RESOURCES - AN OVERVIEW 5 Energy Resources - An Overview 1 Introduction Energy drives our societies and industries. The supply of energy is a prerequisite for their functioning. Germany is highly dependent on energy imports. Demand and imports of the individual types of energy in 1991 and 2001 are compared in Figure 1. It can be seen that Germany has become increasingly dependent on imports. Nearly all of the supply of crude oil is imported. Due to the small amount of domestic reserves, Germany will continue to be increasingly dependent on imports. Primary energy consumption has increased worldwide in the last several decades (Fig. 2). There has been a particularly large increase in oil and gas consumption, whereas the use of coal has stagnated (Fig. 3). Primary energy consumption has increased by about 70 % over the last three decades. The most recent IEA report (IEA 2002) predicts a further 66 % increase in demand by This places an adequate supply of the individual energy resources in the long-term future in question. This problem is the main focus of this study. PJ 6,00 5,546 5,576 76% Imports 5,00 Domestic production 4,00 3,00 97% 97% 2,379 3,123 2,329 2,505 1% 2,00 1,00 75% 82% 14% 1,905 54% 1,866 1,609 1,629 1% Oil Natural gas Hard coal Nuclear energy Lignite Hydro, Others wind, solar Abb. 1: Energy consumption and imports in Germany in 1991 and 2001 Sources: Arbeitsgemeinschaft Energiebilanzen, BGR (2002)

10 6 ENERGY RESOURCES - AN OVERVIEW EJ Hydropower Nuclear energy 300 Natural gas 200 Oil Coal Fig. 2: Development of primary energy consumption worldwide (cumulative), not including biomass Source: BP Reserves and resources of the individual fuels at the end of 2001 are analyzed for individual countries and regions, as well as globally. The analysis is based on published data from professional journals and other publications, reports from national organizations, embassies and our own research. Marked differences from other published data are discussed where necessary. The reserve figures given in this study indicate a sufficient supply of nearly all types of energy resources in the medium-term, assuming a stable price structure and moderate increases in consumption. Only crude oil is expected to become in short supply after Non-renewable energy reserves were at the same level at the end of 2001 as given in the previous BGR energy study (BGR 1999) for the end of In contrast, there was a distinct reduction in the amount of non-renewable energy resources. The 2002 energy study describes the situation for each fuel separately; the regional divisions used in the previous study have been retained and the changes in the reserves, resources and production figures and the reasons for them are discussed. Consumption, trade, price development, demand trends, and possibilities for meeting demand are discussed in more detail than in the previous studies.

11 ENERGY RESOURCES - AN OVERVIEW EJ 160 Oil Coal Natural gas Hydropower 20 Nuclear energy Fig. 3: Development of worldwide primary energy consumption of the individual fuels, not including biomass Quelle: BP (versch. Jahre) As far as possible the same terms are used for the reserve and resource classification of all energy resources, using the terms of the UN classification system. For hydrocarbons, the definitions drawn up by the World Petroleum Congress (WPC) and the Society of Petroleum Engineers (SPE) are used worldwide. These will ultimately be harmonized with those of the UN classification system. At present they are not quite compatible with the definitions for coal. The definitions of the classes used for the individual energy resources are given at the end of this summary. The international system of metric units (SI) is used for most of the study. The exception is the unit barrel (b or bbl) commonly used by the oil industry. Instead of the use of million, billion, and trillion, as in the previous study (BGR 1999), the terms mega, giga, tera, and exa (M, G, T, & E = 106, 109, 1012, 1018) are used. In the case of cubic metres, a period is placed after the prefix symbol, e.g., G.m3. 7

12 8 ENERGY RESOURCES - AN OVERVIEW 2 Changes in Global Reserves and Resources Reserves and resources of non-renewable fuels at the end of 1997 and 2001 are given in Tables 1 and 2. The amounts in Table 1 are given in the units normally used for the individual types of fuel. For ease of comparison, the amounts are given in tce and exajoules in Table 2. Because the conversion factors used by the Arbeitsgemeinschaft Energiebilanzen of the German Institute of Economic Research (DIW) have been used for the present study, the conversion factors for hydrocarbons are slightly different from those in the 1998 energy study (BGR 1999). (1 t crude oil is now tce instead of 1.5 tce and 1000 m 3 natural gas is now tce instead of 1.18 tce.) These new conversion factors have also been applied to the values from the previous study (BGR 1999). Coal has the largest reserves, now amounting to about 55 % of the reserves of all non-renewable fuels (Fig. 4). Oil has about 26 % (conventional oil 17.9 % and non-conventional oil 7.8 %), followed by natural gas with almost 15 %. Nuclear fuels make up about 4 %. Resources of non-renewable fuels at the end of 2001 amounted to about 6600 Gtce or 194,000 EJ (Table 2). This is about 40 % less than 1997 (i.e., about 4400 Gtce or 130,000 EJ less). As for the reserve amounts, the changes differed for the individual fuels. Resource amounts decreased for nearly all of the energy fuels, except for conventional oil. The changes in reserves and resources (Tables 1 and 2) are first briefly discussed here and then elaborated for each of the individual resources. Reserves (i.e., the amount currently technologically and economically recoverable) of nonrenewable fuels at the end of 2001 amounted to about 1200 Gtce or 35,500 EJ (Table 2), about the same level as at the end of 1997 (BGR 1999). The largest increase was for hard coal; there was a small increase for conventional hydrocarbons. Reserves of non-conventional oil, lignite and of uranium decreased.

13 ENERGY RESOURCES - AN OVERVIEW 9 Table 1: Reserves and resources of non-renewable fuels in 1997 and 2001 (in the units usually used for the respective resources) Reserves Resources crude oil 151 Gt 152 Gt 76 Gt 84 Gt natural gas 153 T.m³ 161 T.m³ 226 T.m³ 217 T.m³ conventional hydrocarbons 272 Gtoe 279 Gtoe 254 Gtoe 255 Gtoe havy oil 33 Gt 77 Gt oil sands/extra heavy oil 100 Gt 65 Gt 15 Gt 66 Gt oil shale 1 Gt 1 Gt 481 Gt 184 Gt non-conventional oil 134 Gtoe 66 Gtoe 574 Gtoe 250 Gtoe tight gas 1 T.m³ 1 T.m³ 1,540 T.m³ 500 T.m³ coal-bed methane 2 T.m³ 1 T.m³ 85 T.m³ 85 T.m³ aquifer gas 1,500 T.m³ 800 T.m³ gas hydrates 1,540 T.m³ 500 T.m³ non-conventional gas ca. 3 T.m³ ca. 2 T.m³ 3,237 T.m³ 1,533 T.m³ non-conventional hydrocarbons 137 Gtoe 68 Gtoe 3,131 Gtoe 1,716 Gtoe HYDROCARBONS total 409 Gtoe 347 Gtoe 3,385 Gtoe 1,661 Gtoe hard coal 487 Gt SKE 603 Gt SKE 5,021 Gt SKE 3,546 Gt SKE soft brown coal 71 Gt SKE 67 Gt SKE 1,089 Gt SKE 417 Gt SKE COAL total 558 Gt SKE 670 Gt SKE 6,110 Gt SKE 3,963 Gt SKE uranium 2,32 Mt U 1) 1,57 Mt U 2) 5,94 Mt U 3) 12,36 Mt U 4) 5,67 Mt U 3) 12,52 Mt U 4) thorium 2,16 Mt Th 2,16 Mt Th 2,35 Mt Th 2,35 Mt Th totals can differ due to rounding 1) RAR (reasonable assured resources) recoverable for less than $80/kg U 2) RAR recoverable for less than $40/kg U 3) sum of RAR recoverable from $40 $130/kg U plus EAR (estimated additional resources) I + II 4) speculative resources

14 10 ENERGY RESOURCES - AN OVERVIEW Table 2: Reserves and resources of non-renewable fuels in 1997 and 2001 (in Gtce and EJ) Reserves [ Gt SKE ] Resources [ Gt SKE ] Reserves [ EJ (10 18 J)] Resources [ EJ (10 18 J)] crude oil ,318 6,360 3,180 3,515 natural gas ,855 5,109 7,171 6,886 conventional hydrocarbons ,173 11,469 10,351 10,400 heavy oil ,381 3,222 oil sands / extra heavy oil ,184 2, ,761 oil shale 1 8) ,125 7,699 non-conventional oil ,605 2,761 23,975 10,460 tight gas ,586 2,856 coal-bed methane ,697 4,538 aquifer gas 1, ,598 25,374 gas hydrates 1, ,867 15,866 non-conventional gas non-conventional hydrocarbons ,507 4,325 1,660 2, , , , ,722 48,633 59,093 HYDROCARBONS total ,678 2,372 16,873 14, ,074 69,494 hard coal ,021 3,546 14,269 17, , ,898 soft brown coal , ,080 1,963 31,908 12,218 COAL total ,110 3,963 16,349 19, , ,116 fossil fuels 1,134 1,158 10,788 6,335 33,222 33, , ,610 uranium 1) 34 2) 22 3) 83 4) 173 5) 73 4) 175 5) ,432 5,068 2,139 5,128 thorium 6) nuclear fuels ,905 1,552 8,464 8,230 NON-RENEWABLE RESOURCES 1,199 1,211 10,816 6,617 35,126 35, , ,840 total can differ due to rounding 1) 1 t U = 14,000 23,000 t tce (the lower value is used in this report), or 1 t U = 0,5 x J 2) RAR (reasonably assured resources) recoverable for less than $80/kg U 3) RAR recoverable for less than $40/kg U 4) sum of RAR recoverable from $40 $130/kg U plus EAR (estimated additional resources) I + II 5) speculative resources 6) 1 t Th is assumed to have the same tce value as 1 t U

15 ENERGY RESOURCES - AN OVERVIEW 11 Coal has the largest resource amounts, with a share of about 60 % of all non-renewable fuels, more than for reserves (Fig. 4). Natural gas has about 29 % (conventional gas 3.5 % and nonconventional gas 25.1 %), followed by oil with about 7 %. Nuclear fuels make up about 4 %. The ratio of annual production, reserves, and resources is 1 : 105 : 580. The situation with respect to geothermal energy worldwide was also updated. The definitions of reserves and resources do not apply to the type of energy supply. It may be concluded from global reserves of fuels, except for conventional oil, that the longterm energy demand will be adequately covered. For an assessment of future demand and coverage, it is important to consider regional distribution. Conv. natural gas 14.4 % Non-conv. natural gas 0.2 % Hard coal 49.8 % Reserves 35,477 EJ Non-conv. oil 7.8 % Conv. oil 17.9 % Thorium 2.6 % Uranium 1.8 % Soft brown coal 5.5 % Natural gas 24.0% Oil 44.0 % Uranium 4.6 % Soft brown coal 2.8 % Hard coal 24.5 % Production 334 EJ Non-conv. natural gas 25.1 % Conv. natural gas 3.5 % Non-conv. Oil 5.4 % Conv. Oil 1.8 % Thorium 0.6 % Uranium 3.7 % Hard coal 53.5 % Soft brown coal 6.3 % Resources 194,051 EJ Fig. 4: Annual production, reserves, and resources of the individual non-renewable fuels in 2001 in percent of the total.

16 12 ENERGY RESOURCES - AN OVERVIEW 3 Regional Aspects Energy resources are not distributed evenly across the globe. Regions and countries with rich deposits often do not coincide with the regions and countries with a high energy consumption. Thus, world trade is of considerable significance in the energy sector. The regional distribution of resources, reserves, production and consumption of non-renewable fuels (compiled on the basis of energy content) is shown in Figure 5. In this representation, large differences between the individual fuels are not visible. The data for the individual resources are compiled in Tables 1 to 6. The CIS countries have by far the largest amount of resources, with large occurrences of coal, oil and gas. North America and the Austral-Asian countries also have considerable coal and natural gas resources. North America, Austral-Asia, and the CIS countries have energy reserves in about the same amounts, owing to their large coal reserves. The energy reserves of the Middle East are not as large, despite the large oil and gas reserves of the region. Shares in % Europe C.I.S. Africa Middle East Austral-Asia Noth-America Latin America Resources Reserves Production Consumption Fig. 5: Regional distribution of resources, reserves, production and consumption of non-renewable fuels in 2001 (on the basis of energy content).

17 ENERGY RESOURCES - AN OVERVIEW 13 The highest annual production (highest gas, high oil and coal production) is in North America, followed by Austral-Asia (which has the highest coal production and relatively little oil and gas production). Annual production of fuels is somewhat less and nearly the same in the CIS countries (high oil and gas production) and the Middle East (which has the highest oil production). The highest fuel consumption is in North America (the highest consumption of oil and gas and a high coal consumption), closely followed by Austral-Asia (with the highest coal consumption in China and India and a high oil consumption). Despite a high oil and gas consumption, energy consumption in Europe is distinctly less. About 40 % of the demand for primary energy is met by crude oil in most regions. In Latin America (not including Mexico) and the Middle East the percentage is higher - 48 % and 52 %, respectively - and much lower in the CIS countries - 18 % - where natural gas covers about 52 % of the primary energy demand. Natural gas also covers a high percentage of the demand in the Middle East. In most regions, the figure is about 20 %, in Austral- Asia it is only 11 %. Coal provides about 41 % of the demand for primary energy in Austral- Asia, more than 30 % in Africa, and about 20 % in North America, Europe and the CIS countries. Nuclear fuels provide about 12 % of the demand for primary energy in Europe, and only about 5.5 % globally. Hydroelectric power provides about 26 % of the energy supply of South America, but only insignificant amount in other regions. Table 3: Regional distribution of reserves of non-renewable fuels in 2001 [in EJ] Region crude oil natural gas coal uranium thorium gesamt nonconventional nonconventional conventional conventional hard coal soft brown coal Europe , ,276 CIS , , ,567 Africa ,881 Middle East 3, , ,254 Austral-Asia , ,584 North America 354 1, , ,900 Latin America ,984 WORLD 6,351 2,761 5, ,666 1, ,447 OECD 507 1, ,014 1, ,204 EU ,378 OPEC 4, , ,053 totals can differ due to rounding also with respect to the figures in Table 2

18 14 ENERGY RESOURCES - AN OVERVIEW Table 4: Regional distribution of resources of non-renewable fuels in 2001 [in EJ] Region Europe CIS Africa Middle East Austral-Asia North America Latin America WORLD OECD EU-15 OPEC crude oil natural gas coal uranium thorium total * conventional non- conventional non- hard soft conven- tional conven- tional* coal brown coal , , , ,523 1,883 10,460 5, , , , ,879 1, ,669 1,869 6,073 2,764 3,649 8,012 5,851 4,560 32,779 10,059 1,174 5,521 11,963 45,359 5, ,214 18, ,884 35,800 8, ,779 3, ,893 4, ,224 1, , ,930 1, ,256 3, ,625 61,463 9,891 6,469 37,057 37,548 8, ,002 58,549 11,513 11,125 totals can differ due to rounding also with respect to the figures in Table 2 * not including gas hydrates (542 Gtce), because they cannot be assigned to one of the regions Table 5: Regional distribution of the production of non-renewable fuels in 2001 [in EJ] Region Europe CIS Africa Middle East Austral-Asia North America Latin America WORLD OECD EU-15 OPEC crude oil natural gas hard coal soft brown coal [EJ] uranium total share [%] ,7 15,8 8,1 15,5 21,3 24,3 5,3 100,0 38,8 5,4 22,5 totals can differ due to rounding

19 ENERGY RESOURCES - AN OVERVIEW 15 Table 6: Regional distribution of the consumption of non-renewable fuels in 2001 [in EJ] Region Europe CIS Africa Middle East Austral-Asia North America Latin America WORLD OECD EU-15 OPEC crude oil natural gas coal [EJ] uranium total share [%] ,7 10,0 3,1 4,4 28,3 29,6 3,8 100,0 62,6 17,5 6,7 totals can differ due to rounding When we take a look at the distribution of the world's population and the consumption of coal, oil and gas in selected groups of countries (Fig. 6), it is noticeable that the developing and threshold countries, with nearly 80 % of the global population, have about 40 % of the coal consumption, a third of the oil consumption, and only 13 % of the natural gas consumption of the world as a whole. This brings out the importance of coal for the these countries. In contrast, the OECD countries, with only 17 % of the world's population, consume more than 60 % of the world's oil and gas production and nearly half of the coal. The regional distribution of energy resources is determined by the regional geology. Expressed simply, countries with a large area usually have a wide geological diversity, which increases the probability that energy resources are present. This explains the high proportion of energy resources in the USA, Russia, China, and Australia. The dominance of the Middle East with respect to hydrocarbons is due to the favorable conditions for the preservation of oil and gas in the sediment basins there. In contrast, the geological prerequisites for coal accumulations, as found in Eurasia, North America and Australia, are lacking.

20 16 ENERGY RESOURCES - AN OVERVIEW Share of selected groups in % OECD CEE+CIS DT 80 Population Coal Oil Natural gas Fig. 6: The distribution of the world's population and the consumption of coal, oil and gas according to selected country groups (CEE: central and eastern Europe, DT: developing and threshold countries) EJ 6,329 Uranium 6,000 5,000 5,098 Coal Natural gas Crude oil 4,000 3,000 2,000 1,000 2,502 2,104 1,691 1,582 1,486 1,380 1,023 1,023 0 USA Russia China Australia Saudi Arabia India Canada Iran Germany Venezuela Fig. 7: Reserves of non-renewable fuels in the ten countries with the most reserves in 2001 (OPEC countries in blue)

21 ENERGY RESOURCES - AN OVERVIEW 17 4 The individual energy resources In terms of global consumption, crude oil is the most important primary fuel, accounting for 38.5 % of world primary energy consumption (not including biomass) (BP 2002). Forecasts (e.g., IEA 2000) assume there will be no significant change in this respect in the next several decades. The estimated ultimate recovery (EUR) of conventional crude oil is reported in this study to be about 364 Gt, slightly higher than the 346 Gt of the 1998 energy study (BGR 1999). The regional distribution of estimated ultimate recovery of conventional crude oil, comprising cumulative production, reserves and resources, is very uneven (Fig. 8). The Middle East has the highest EUR. Of the EUR of North America, more than half has been recovered. In the CIS countries, about a third has been recovered and in the Middle East about a fifth. The OPEC countries have an EUR of about 193 Gt, accounting for more than half of the global EUR, of which only about one-fourth has been produced. The OECD countries have an EUR of only 72 Gt, of which nearly 60 % has already been recovered. Global crude oil reserves increased slightly to Gt from 1997 to 2001, despite production of about 14.1 Gt. This increase in reserves results mainly from a higher assessment of known fields and only to a small extent from new finds. Major new fields were discovered in the Caspian region, the Middle East, offshore Brazil and the west coast of Africa, and in the Gulf of Mexico. About 62 % of global reserves are in the Middle East, about 14 % in North and South America, and about 10 % in the CIS countries. OPEC has about 75 % of global reserves (of which 61 % is in the Persian Gulf region), OECD about 8 %, leaving about 17 % for the rest of the world. On the basis of world production in 2001, static reserves lifetime will be about 43 years, little changed since Global crude oil production has increased only slightly in the last five years: from 3495 Mt in 1997 to Mt in Production decreased in 1999 as a result of reductions by OPEC as a price stabilization measure. The same is expected for The reductions broke the trend of large increases in production from 1994 to The maximum production Mt - was in the year The regions with the highest production in 2001 were the Middle East and North America. Global production of crude oil up to the end of 2001 amounted to about 128 Gt, with half of that figure within the last twenty years. Hence, 46 % of demonstrated conventional oil reserves has been recovered. Taking the resources of about 84 Gt into consideration, about 35 % of the estimated ultimate recovery has been consumed. The depletion mid-point may be expected to be reached in the next fifteen to twenty years. In addition to conventional oil occurrences, non-conventional oil occurrences have a sizeable potential. Reserves of non-conventional oil amount to about 43 % of the conventional oil reserves. Non-conventional oil resources exceed those of conventional oil occurrences by three times. Most of the non-conventional oil resources are oil shale, whose economic recovery in the foreseeable future would involve high costs and environmental problems. For this reason, only a few pilot projects may be expected to be carried out. Oil sands and extra heavy oil do not have these problems, and numerous projects have been started in Canada and Venezuela in the last several years.

22 18 ENERGY RESOURCES - AN OVERVIEW Production costs have already been reduced close to those of conventional oil. It is to be expected, however, that these projects will reach only a fraction of the production capacity of conventional oil within the foreseeable future, although they may receive regional significance. Consumption of oil products increased in 2001 by about 125 Mt than in 1997, reaching 3.5 Gt, the highest ever. Global mineral oil consumption is very unevenly distributed. The OECD countries used about 2.2 Gt, or about 62 % of the total in 2001, the OPEC countries only about 8 %. Consumption was concentrated in North America, Austral-Asia, and Europe. About two-thirds of the crude oil produced in 2001 was transported across country boundaries, in part over large distances by tanker or pipeline. For crude oil, there is a single global market with nearly uniform prices. In summary, the following future developments can be expected for crude oil: From a geological viewpoint, the remaining potential for conventional oil can provide for a moderate increase in oil consumption in the next years without problems. The percentage of oil production by the OPEC countries (especially in the Persian Gulf region) that still have significant reserves for a short-term increase in production capacity will increase in the next several decades. After that, an insufficient supply may be expected, owing to decreasing production when the depletion mid-point has been passed. Demand will then have to be met by other fuels Resources Reserves 56 Cum. production EUR in Gt Fig. 8: Regional distribution of the estimated ultimate recovery (364 Gt) of conventional crude oil in 2001

23 ENERGY RESOURCES - AN OVERVIEW 19 The percentage of non-conventional oil will increase to 5-10 % of total oil production by 2020 as oil prices rise to a relatively high level. Despite the possibilities mentioned above, it can be expected that in the foreseeable future, crude oil will not be available in the unlimited amounts it has been up to now. There are numerous uncertainties that could possibly affect the crude oil availability: The lifetime could possibly be shortened by a downward revision of OPEC reserves. These reserves were sharply increased in the 1980s for political reasons (to keep OPEC production quotas in balance). The lifetime can be lengthened due to uncertainties in reserve assessment. Often, reserve figures do not include probable and possible reserves. The lifetime can be lengthened by inclusion of additional quantities of heavy oil in the reserves. Owing to uncertainties of whether heavy oil has been classified by some countries as conventional or nonconventional oil, this possibility was not considered in the present study, in contrast to the previous assessment (BGR 1999). If even part of the heavy oil reserves and resources given in the previous study actually exist and are not included in the figures for conventional and other non-conventional oil, this would increase the EUR of crude oil. Moreover, heavy oil is easier to recover than oil sand or extra-heavy oil. The last several years have shown that production forecasts based on the production potential of individual reservoirs are too low. Increases in reserves and enhanced production methods surely play a role in this observation. A further uncertainty: the discussion of climate change and the role of CO 2 emissions from the burning of fossil fuels may play a role in the future demand for oil. Natural gas accounts for about 24 % of primary energy consumption, after crude oil and hard coal. Its share has increased in the last several years, and this trend can be expected to continue in the future. The global estimated ultimate recovery determined in this study for conventional natural gas is about 447 trillion m³ (corresponding to about 353 Gtoe, which is about the same as the EUR for conventional oil). This value is nearly 8 trillion m³ (about 2 %) more than the previous estimate (BGR 1999). It may be considered as a conservative estimate. The remaining potential is about 2 trillion m³ less than before. The regional EUR distribution, as for crude oil, is very uneven, as shown in Figure 9. The CIS countries, particularly Russia, have the largest EUR. The value for the Middle East is also considerable. Although North America has a substantial EUR, the remaining potential is less significant, since nearly half of its EUR has already been produced (particularly in the United States). The EUR of about 5 % for Europe (not including the CIS countries) is of little importance. The European gas market, however, has access to about 38 % of the global EUR for natural gas, due to the accessibility to Russian fields. If the Middle East is considered a potential supplier, this figure rises to about 70 %. The European gas market, therefore, is in a comfortable position compared to other gas markets.

24 20 ENERGY RESOURCES - AN OVERVIEW Despite increasing production, global reserves of conventional natural gas have further increased to nearly 161 trillion m³ at the end of Their energy content corresponds to about 84 % of the global reserves of conventional crude oil. Global resources of conventional natural gas are estimated to be about 217 trillion m³. The global remaining conventional natural gas potential is about 377 trillion m³, with an energy content about 26 % above that of the remaining conventional oil potential. Global production of natural gas has continually increased in the last several years, reaching a high of about 2.5 trillion m³ in The regions with the highest production are the CIS countries and North America, each with about a third of global production, followed by Europe with an eighth. Cross-border trade (not including transit across third countries) amounted to about 650 billion m³ (about 25 % of production worldwide) in About 23 % of this amount was liquified natural gas (LNG). Cumulative natural gas production by the end of 2001 reached nearly 70 trillion m 3, or 30 % of the total reserves discovered up to that time. Half of this amount was produced within the last 16 years. When flared gas is taken into consideration, more than one-third of the original reserves has been removed. Half of the total reserves discovered up to this time will have been consumed by 2019, assuming annual production remains the same and reserves are not increased by new discoveries Resources Reserves Cum. production 66 EUR in T.m 3 Fig. 9: Regional distribution of estimated ultimate recovery (447 trillion m 3 ) of conventional natural gas in 2001

25 ENERGY RESOURCES - AN OVERVIEW 21 and enhanced production methods. Static lifetime of the present natural gas reserves is about 64 years. There are four main regional natural gas markets in which producers and distributors have long-term contracts: the European market, with the main exporters Russia, North Africa, Norway, and the Netherlands; the North American market (NAFTA); the Asian market, characterized by large distance between the main consumers (mainly Japan, South Korea, and Taiwan) and the producing countries (mainly Indonesia, Malaysia, and Brunei); and the South American market, which has recently developed. There are considerable uncertainties in the estimates of the amounts of non-conventional natural gas that can be recovered. Global reserves of non-conventional natural gas are estimated to amount to only 2 trillion m 3, because recovery technology is available only for coalseam gas and tight reservoirs. Moreover, the conditions necessary for economic production are present only in relatively small regions. We estimate non-conventional natural gas resources (not including gas hydrates and aquifer gas) to amount to about 220 trillion m 3, which is about half of the estimated ultimate recovery of conventional natural gas. The 1:100 ratio of original reserves to resources reflects the low degree of exploration: This ratio is about 1:1 for conventional natural gas and about 3.3:1 for conventional oil. Estimates of the quantity of natural gas in gas hydrates and aquifers differ considerably and have a high degree of uncertainty. A few production facilities for this kind of gas do exist, but they are mostly on a pilot scale. A critical analysis of the results of recent research leads to a distinct reduction of the resources that can be expected. Significant commercial production is not probable in the foreseeable future, despite the immense amounts that can possibly be recovered trillion m³ for gas hydrates and 500 trillion m 3 in aquifers, which is more than the EUR of conventional natural gas. Demonstrated global reserves of natural gas will last until mid-century, assuming production remains at the same level as at present. It can be expected that the technologies for production of coal-seam gas and tight gas will continue to be improved, and increasing demand will be met into the latter part of the century. The following conclusions can be drawn about the global natural gas reserves and resources situation: From a geological viewpoint, natural gas is present in sufficient amounts to meet demand for many decades. The present trend of increasing demand can be met by additional supplies from the present supplier countries and new exporters. A deficit could develop in the North American market that could be covered only by LNG imports. Prices for natural gas are influenced by transport costs that are significantly higher than for crude oil and coal. Transport of natural gas will continue to be mainly by pipeline, but the proportion of LNG will increase, for which a spot market may be expected to develop. Long-term investment will be needed to increase production capacities and to expand transportation facilities. The finance markets, however, are mostly interested in short-term investment.

26 22 ENERGY RESOURCES - AN OVERVIEW Coal has the largest global reserves and resources. Hard coal (>16,500 kj/kg) is traded world-wide; the price is little affected by transport cost. Soft brown coal is used mostly locally by power plants near the coal fields. reserves increased from 16 Gtce to 104 Gtce. The USA has the largest coal reserves (~203 Gtce or ~30 % of global reserves), followed by Russia (~104 Gtce or ~16 %), China (71 Gtce or ~11 %), Australia (~9 %), and India (~8 %). Germany has about 34 Gtce (~21.6 Gtce hard coal and ~12.8 Gtce soft brown coal). In view of the high cost of mining coal in Germany, these amounts can be considered reserves only with reservation. In a number of countries, more information is needed. For this reason coal reserves and resources figures can be expected to shift considerably in the future. Coal accounted for about 27 % of global primary energy consumption in 2001 (hard coal ~24 %, soft brown coal ~3 %), in second place behind crude oil. Coal is the fuel most used in power plants (37 %). Global coal reserves in the year 2000 amounted to 670 Gtce (603 Gtce hard coal and 67 Gtce soft brown coal). The regional distribution of hard coal reserves is shown in Figure 10. Coal reserves are about 112 Gtce higher than in 1997, mainly due to new assessments, especially of hard coal deposits in Russia, whose On the basis of production in 2001, the static lifetime of global reserves of hard coal is about 207 years and of soft brown coal about 198 years. 190,3 45,0 221,8 186,8 0,2 20,5 39,1 Fig. 10: Regional distribution of hard coal reserves (in Gt) 50,0

27 ENERGY RESOURCES - AN OVERVIEW 23 Coal, like crude oil and natural gas, is unevenly distributed. About 79 % of global reserves are in only six countries. These countries accounted for about 87 % (~3055 Mt) of global hard coal production (~3510 Mt). In terms of heat equivalent, hard coal (2808 Mtce) accounts for most coal production. Since 1997, coal production has decreased by about 200 Mtce. About 16 % (~571 Mt) of hard coal production is traded on the world market, continuing the expansion of the global hard coal market. More than 50 % of this trade was in East Asia, about one-third in the EU. Germany imported 35 Mtce of hard coal in 2001, more than the domestic production of 27.9 Mtce. Future developments on the coal market may be summarized as follows: Hard coal accounts for 23 % (~3 Gt) of global energy consumption; 60 % of this is used to generate electricity. Coal will continue to be a major component of the energy mix. There is an ongoing change in the structure of the coal markets as a result of globalization. This is expressed in a concentration of supply from Australia, Colombia, and South Africa and increasing importance of China and Russia. The global market for hard coal will continue to grow. Increases of % may be expected until Growth in the hard coal market will come mainly from Asia, especially India and China. It is expected that these countries will become the most important importers of hard coal. Power plants will be the largest consumer of hard coal, in order to meet the increasing demand for electricity. Owing to low production costs and large reserves, Australia, Indonesia, and Colombia have a large export potential. China and Russia can potentially increase their share of the coal market. Owing to their high domestic demand and/or high production costs, the global market share of the USA, Canada, and Poland will decrease. Whether the industrial countries will experience moderate growth in the next several years will depend on the extent to which clean coal technologies are introduced. Governmental energy policies should support the efforts of industry, for example, to increase the efficiency of conventional power plants. The remaining coal reserves are sufficient to cover demand of the coming century. A more precise international definition of reserves according to quality and economic recoverability would aid more accurate forecasts. Efforts are being made in this direction in the USA by the USGS and in Russia.

28 24 ENERGY RESOURCES - AN OVERVIEW Uranium reserves (1.57 Mt) are sufficient to supply nuclear power plants for the next twenty years. Nuclear power plants (354 GWelt capacity) used about 64,400 t uranium, of which about 34,000 t came from mine production. five years amounted to between 32,200 and 37,300 t U; annual consumption was about 60,000 t U. The difference was supplied from civil and military stockpiles, especially in Russia. Uranium from the decommissioning of nuclear weapons under disarmament pacts and uranium and plutonium from the reprocessing of fuel rods will continue to play a role in the future; this will be dependent on political decisions, however. Uranium reserves and resources are present in only a few countries (Fig. 11). Ten countries have nearly 99 % of the reserves recoverable at a cost of less than $40/kg U. Four countries have nearly 80 % of the reserves: Australia (646,000 t U, ~41 %), Canada (265,000 t U, ~17 %), Kazakhstan (232,000 t U, ~15 %), and South Africa (118,000 t U, ~8 %). In contrast to fossil fuels, production is less than consumption. Annual global production in the last Most uranium mine production is accounted for by a small number of countries. Canada accounted for about 31 % of global production. Australia, Niger, and Namibia accounted for a further 32 % of global production. There is little mine production (the USA and France) or 1,275 1,259 1,550 2,388 1, , , ,628 speculative Reserves Resources Fig. 11: Countries with more than 200 kt U total uranium resources (reserves + resources in kt U)

29 ENERGY RESOURCES - AN OVERVIEW 25 none (Japan, Germany, and the UK) by the main consumers. Owing to the low prices, production is concentrated on a few countries that have low production costs (Canada, Australia, Kazakhstan, and Uzbekistan). The five largest mining companies accounted for about 80 % of the uranium produced in Spot prices were a low c. $19/kg U in 2001, prices in longterm contracts were $26-27/kg U (e.g., EURA- TOM: $34/kg U). Thorium is not used for power generation as there are no operating thorium reactors. The reserves of more than 2 million t Th can be considered as a basis for the future. Geothermal energy is defined as the heat stored in the crustal rocks that can be reached by wells down to a depth of 7 km. The energy content of these rocks is considerably more than the total of all non-renewable energy resources. Only a small proportion of this energy can be recovered, however. The capacity of a geothermal power plant depends largely on the depth of the well(s), i.e., the temperature, and the hydraulic permeability of the rock. There are three different kinds of systems: 1. utilization of the heat in the ground at shallow depth by means of heat pumps (used mainly for heating of individual buildings); 2. utilization of heat from warm and hot water aquifers from low-enthalpy hydrothermal sources (< 150 C), used mainly for largescale central heating systems, but increasingly for organic Rankine cycle (ORC) turbogenerators; 3. utilization of superheated steam or hot water from high-enthalpy hydrothermal sources (> 150 C). Superheated steam sources (> 200 C) are used mainly to generate electricity in steam turbine power plants. Superheated hot water sources ( C) are used mainly in ORC turbogenerators to generate electricity (the heat of the hot water is transferred in a heat exchanger to an low-boiling organic liquid, which is used to drive the turbine). 4. More research is needed for commercial utilization of hot-dry-rock technology. It is difficult at the present time to estimate how large its enormous potential is. A capacity of about 342 MW th was installed in small heating systems in Germany in Low-temperature hydrothermal occurrences are used in 28 large central heating systems. Large geothermal systems (>1 MW th ) have a total capacity of about 36 MW th. Large lowtemperature hydrothermal occurrences are assumed to be present in the North German basin, the Molasse basin in southern Germany, and in the Upper Rhine graben. Several geothermal power plant projects are in the planning or construction stage. Geothermal energy was being used directly in 27 European countries in 1999, with a total capacity of 5975 MW th. The largest capacities are in Iceland, Turkey, Switzerland, Hungary, and Germany. For generation of electricity, Italy produces the most electricity (785 MW e ) from geothermal resources, followed by Iceland. Worldwide, capacity of installed geothermal systems is 23,100 MW: 15,100 MW th and 8000 MW e. The USA has the highest installed capacity of geothermal systems: 3766 MW th and 2228 MW e, followed by China, the Philippines, Japan, and Iceland. High growth rates are expected for the utilization of geothermal energy for both heating and the generation of electricity. The long-term development will depend less on resource availability than on the economic conditions.

30 26 ENERGY RESOURCES - AN OVERVIEW 5 The Availability of the Energy Resources In view of the finite amount of non-renewable fuels, the question arises as to how the different resources will last. The question also arises as to the extent to which the different fuels can be substituted in the medium and long term, particularly in view of the increasing sensitivity of the public to the environmental aspects. The static lifetimes of the individual fuel resources are shown in Figure 12. Especially crude oil and natural gas have relatively short static lifetimes. This is particularly the case for the conventional reserves. In the case of both fossil fuels, increasing demand is expected and will shorten the lifetimes. A longer lifetime can be expected only if non-conventional resources are included. The lifetimes of the fuel resources can be estimated on a static or dynamic basis. The static lifetime is the ratio of the current reserves to the last annual production. It describes the current situation and is only a snapshot of a dynamic system in which the parameter values, i.e., the reserves, are continually changing as a result of continuing exploration, improved production technology, and ongoing production, as a result of demand and production capacities. The dynamic lifetime takes future developments into consideration: production rates, technological developments, exploration, and reserves. Dynamic lifetimes are normally shorter than static lifetimes, but if the forecasts are reliable, are nearer reality. These predictions, however, have very large uncertainties. For this reason, we use static lifetimes Oil conventional conventional + non-conv. Reserves Resources 157 Natural gas conventional conventional + non-conv Hard coal Soft brown coal Uranium >200 > years Fig. 12: Static lifetimes of the reserves and resources of the non-renewable fuels

31 ENERGY RESOURCES - AN OVERVIEW 27 The reserves of both hard coal and soft brown coal have static lifetimes of about 200 years. Resources of both have lifetimes of more than 1000 years. Both fossil fuels will receive increasing importance as primary fuels in the coming years, especially for power plants. According to ABARE (2002), consumption will double by Industry, research, and politics are making efforts to develop emission-free power plants, or at least ones with less emissions than at present. The static lifetimes shown in Figure 12 for uranium reserves and resources (42 years and about 485 years, respectively) are not directly comparable to those of the fossil fuels. Only about 50 % of the annual demand for uranium has been met by mining production. The remaining amount has been covered by the reprocessing of spent fuel rods and weapons uranium, as well as from stockpiles. Weapons uranium and stockpiles will have been exhausted in about 20 years. 6 Definitionen basis for the distinction between reserves and resources. The fluctuations observed for uranium would be seen in the figures for the other non-renewable fuels if the corresponding data were available. For uranium the term reasonably assured resources is used. This includes uranium ore recoverable up to $40 per kg U, which is considered as reserves in this report. Resources: That part of the total resources which are either (i) proved but at present not economically recoverable, or (ii) geologically indicated. In the case of hydrocarbons, only recoverable amounts are considered. For coal this term is used for all resources in-place. Total resources (for hydrocarbons: remaining potential ): reserves plus resources. Note that the reserves are not included in the resources. The term estimated ultimate recovery (EUR) is used only for hydrocarbons and comprises the cumulative production, reserves and resources. It is not used for other energy resources. To avoid misunderstandings, the terms reserves and resources are defined here for all energy resources dealt with in this report. Reserves: That part of the total resources which is documented in detail and can be recovered economically using current technology. The following expressions are widely used as synonyms for the term reserves : exploitable reserves, and proved and probable reserves. The dependence of reserves on price is especially noticeable in the case of uranium, the only energy resource for which production cost is a