An energy industry leader has stressed there are more than enough oil and gas resources in the world to meet future demand.
Andy Inglis, chief executive of BP Exploration and Production, said in a speech in Texas that there were about 40 years of proven oil reserves and 60 years of natural gas.
He added that the task facing the industry was making sure that supply would rise adequately to meet demand.
Mr Inglis, speaking at Rice University in Houston this week, said: “The really big strategic issue for all oil and gas companies is matching the Earth’s resource endowment on the one hand, with the capability – technology, skills and know-how – required to bring those resources to market on the other. I think it is true to say that we may have reached a period of ‘peak capability’, at least in the short term.
“As far as I am concerned, peak capability bears a far closer relation to the facts than so-called ‘peak oil’.”
Mr Inglis said: “For international oil companies, and increasingly national oil companies too, new resources are harder to reach and tougher to produce. Resources are now found in reservoirs which lie at greater water depths, at higher temperatures and pressures and require complex drilling and completion designs.
“Bringing them into production is going to be difficult. It will require that capability gap to be filled.”
On oil prices, Mr Inglis said: “I contend that prices are not being driven by a lack of resource, because there is plenty of oil and gas around.
“Prices are being driven by a confluence of factors. The first of these is the recent period of exceptional worldwide economic growth. Although the short-term outlook for . . . growth is evidently deteriorating, the fundamental drivers of long-term growth in demand for energy remain in place. We have entered a new phase in global industrialisation, led by China and India.
“When Europe industrialised, it involved 50-100million people moving from a rural to an urban way of life. The US industrialisation involved 150-200million people, and those changes took centuries. But in the next decade, in China and India alone, over 1billion people will be moving from a rural to an urban way of life.
“This will result in a dramatic increase in energy consumption to provide light, heat and mobility.”
Mr Inglis said it had been estimated that, by 2030, world energy demand would be 50% higher than today. He added that, at the end of last year, remaining proved oil reserves stood at about 2.3trillion barrels of oil equivalent.
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