The world is not on the verge of running out of oil in the near- or medium-term, and increased availability of unconventional oils has the potential to grow global liquid hydrocarbon capacity up to 25% in the next 10 years, according to Cambridge Energy Research Associates (CERA). Robert Esser, CERA senior consultant and director of global oil and gas resources, recently testified before a U.S. House energy and air quality subcommittee hearing on understanding the peak oil theory. "We see no evidence to suggest a peak before 2020, nor do we see a transparent and technically sound analysis from another source that justifies belief in an imminent peak," Esser said. "It will be a number of decades into this century before we get to an inflexion point that will herald the arrival of an 'undulating plateau' of global hydrocarbon production capacity." CERA forecasts that world oil production capacity could rise from 87 million barrels per day in 2005 to 108 million by 2015. After a review of CERA's analysis and databases on field production, Esser said the findings contradict those who believe that peak oil is imminent. According to CERA analysis, production-capacity expansion will be split between OPEC and non-OPEC countries between 2005 and 2010. During the next 10 years, OPEC countries will produce a net gain of 12.2 million barrels per day, about 60% of the total anticipated capacity increase, with daily non-OPEC capacity rising 8.2 million barrels. While output from the U.S. and North Sea is forecast to dip, it should grow in Canada, West and North Africa, Latin America, the Caspian and Middle East. Moving into 2010, capacity growth will shift more to OPEC countries, according to CERA. Many of the projected increases stem from major projects in OPEC and non-OPEC countries, with the top 10 projects adding a cumulative gross capacity of 2- to 2.5 million barrels per day annually until 2010, Esser said. The projects were approved when oil prices were lower, so Esser expects they will proceed as planned. CERA and parent IHS Inc. studied field-by-field data that indicate production has been more than replaced by exploration plus upgrades of earlier discoveries. From 1995 through 2003, global production of 236 billion barrels was compensated for by exploration yielding 144 billion barrels and field upgrades yielding 175 billion barrels of additional reserves. The analysis also found that nontraditional energy sources will expand to 35% of total capacity in 2015, compared with 10% in 1990. This projected growth includes expanding ultra-deepwater production from 3.4 million barrels per day to more than 9 million by 2010. Major production-growth sources are expected to be the Gulf of Mexico and offshore Brazil, Angola and Nigeria; more than 250% expansion of heavy-oil production capacity from Canada and Venezuela, from 1.8 million barrels per day to 4.9 million in 2015; new condensate and gas-liquids capacity expansion from 14 million barrels per day to 23 million by 2015; and new gas-to-liquids projects that are expected to produce 1 million barrels per day by 2015, compared with today's 160,000 barrels.

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