1. ASPO WORKSHOP Uppsala THE ASSESSMENT AND IMPORTANCE OF OIL DEPLETION by C.J.Campbell

2. Welcome We have come a long way in a year “Let Uppsala be to Oil Depletion what Kyoto is to Climate Change” - and a good deal better Thanks to Professor Aleklett Thanks to Professor Wellmer Welcome too to Sarah Astor from ODAC in London

3. Three Missions for ASPO 1. To study the endowment of oil and gas in Nature 2. To model depletion, taking into account economics, technology & politics 3. To raise awareness of this critical subject and the consequences for Mankind The challenges are great, but we have made good progress

4. A Geological Starting Point Geology is the bedrock of this subject A short introduction to petroleum geology sets the scene for our debate

5. The Geological Origins of Oil A few brief epochs of extreme global warming gave the bulk of the world’s oil Algal blooms gave organic matter, which was locally preserved in stagnant troughs It was converted to oil and gas on burial The processes are well understood.

6. Oceanic Anoxic Events Global Warming Continental break-up

7. North Sea Oil Generating Trends - Where oil is and where it is not

8. Oil Gas Water Geology of an Oilfield Sandstone Reservoir Source

9. What a Reservoir looks like Oil fills the pore-space between the grains of sand, which are often coated in a film of water. It has to flow through these constrictions. OIL

10. Amazing Seismic Resolution

11. Conclusion Knowledge of petroleum geology has advanced greatly The world has been intensively explored The more promising areas were investigated first The larger fields were also found first, being too large to miss The record of the past points to declining future discovery

12. Understanding Depletion Understanding depletion is simple Think of an Irish pub The glass starts full and ends empty There are only so many more drinks to closing time It’s the same with oil We have to find the bar before we can drink what’s in it

13. Peaks : the eternal pattern Peak Discovery Production US-481930 - 40 years - 1970 N.Sea1973 - 28 years - 2001 World1964 - 40-50 yrs - 2005-10 Peak comes at about the midpoint of depletion But unreliable data obstruct forecasting

14. The Growing Gap between Discovery and Consumption Drilling more does not help

15. Simple plumbing- draining the tanks 140 Yet-to-Find 875 Produced 1760 DISCOVERED 885 Remaining ? Filling at 6/yr Emptying at 23/yr One in - four out Full or empty ? Surprise Billion barrels

16. Distribution of Oil Conventional Oil

17. All Hydrocarbons 2002 Base Case Scenario All boundaries fuzzy

18. Europe’s predicament The decline of the N.Sea

19. Gas is different Gas has a higher molecular mobility More is recovered It depletes differently with a long plateau set by infrastructure an abrupt end Difficult to model Also provides liquids

20. Gas - the unexpected cliff Hidden Spare Capacity No market signal of cliff Production Plateau

21. Flawed Economics Economic theory was built in the Industrial Revolution, 200 years ago Man was perceived Master of his Environment in a world of perpetual growth & prosperity The relationship has changed due to more people resource depletion We need new economic principles to match

22. Some practical proposals ASPO needs to adopt - and firmly adopt - a model of depletion, cutting through all the confusion It needs a simple one that everyone can understand It needs to shift the onus onto those with counter views or motives to justify their position with facts and detailed numbers

23. A simple model Let’s talk only of production avoiding confusing reserve definitions 1. Past production 2 Future production a) based on current wells = Proved Reserves b) from known fields = Proved & Probable Reserves c) from new fields = yet-to-find 3. Total (to a certain date)

24. Let’s divide the work Let’s divide up the countries of the world so that each ASPO member need be responsible for only a few. We can start with what we have and let members audit the results, with the help of their governments or national oil companies, who may co-operate

25. Conclusions We have made good progress The basic story is sure and easy to grasp Let’s co-operate and finish the job –We have a voice that can be heard –Let’s thank the media for making it heard The world deserves better government than just an open market There are solutions