Every molecule counts. That's the message of Don Paul, the recently retired chief technology officer for Chevron. He joined the company in 1975 as a geophysicist, but he goes out as a leader in the upstream and downstream world. Most recently, he worked for two years on the National Petroleum Council's groundbreaking 2007 study, "Facing Hard Energy Truths." "Most people project that global energy demand will go up 50% to 60% in the next 20 years, mainly from population growth and improved living standards. What does this mean? "On the demand side it is the equivalent of another United States. On the supply side, it means adding the equivalent production of another Saudi Arabia and Russia." Speaking to a group of upstream and downstream clients of Hart Energy Publishing and the International Fuel Quality Center (IFQC) in Houston this week, Paul said that around 2010, non-OECD energy demand on a quadrillion Btu basis, will surpass demand from the OECD countries for the first time--and never look back. "This is a historic structural shift in demand. And, it is a question of scale. We will need one-half gallon for every human being on Earth, every day." The world is not running out of energy resources, but there are accumulating risks, especially above ground, that will likely limit growth in conventional fuels, he said. "Yeah, we said this back in the 1970s too, but since then, we have produced another 500 million barrels. This is the uncle in the attic that no one talks about." Paul sees opportunity though: -- Think of the margin between $100 oil and using waste products no one wants, that are not valued by the market at present. Process what is left behind. Do things at the molecular level. --Make the right choices. Should natural gas go into a gas-to-liquids plant to make diesel, or an LNG plant to transport gas? --You have to solve the problem of CO2 emissions. Coal-to-liquids plants are really just huge CO2 machines that happen to make some fuel. They are a source of carbon for fuel that makes CO2. "In the end, you have to figure out how to capture and use CO2, not just store it."
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