Rystad Energy: Covid-19 to reduce world’s recoverable oil by 282 billion bbl

Global total expected remaining recoverable oil resources decrease to 1903 billion bbl, 42% of which are in OPEC territory, with the remaining 58% located outside the alliance.

“Non-OPEC countries account for the lion’s share of “lost” recoverable resources with more than 260 billion bbl of undiscovered oil now more likely to be left untouched, especially in remote exploratory areas,” said Rystad Energy’s Head of Analysis, Per Magnus Nysveen.

OPEC countries are much more resilient to the current crisis and will only lose a fraction compared to their non-OPEC counterparts such as the US (-49 billion bbl) and Russia (-31 billion bbl).

“OPEC countries are expected to lose 21 billion bbl of reserves potential as the negative developments in Venezuela and Iran outweigh the increased strength and reserves potential of core OPEC countries in the Arab Gulf region,” Nysveen added.

Americas

• In the US Rystad expects lower upstream activity in shale acreage, less exploration in the Gulf of Mexico, and a reduced number of licensing rounds on the Atlantic West Coast. In total, this decreases recoverable resources by 49 billion bbl.
• Canada will likely see more high-cost oilsands reserves left in the ground (14 billion bbl) due to increased environmental, social, and governance (ESG) concerns.
• Mexico will likely see reduced exploration for deepwater and shale oil reserves.
• In Brazil, more pre-salt reserves will likely be left in the ground.
• With no normalisation in sight, Venezuela’s actual reserves potential falls further by 21 billion bbl.

Europe

• Russia will see more of estimated Arctic offshore oil reserves left in the ground due to peak oil demand coming sooner, lowering oil reserves by 31 billion bbl.
• Similarly, Norway will also have to leave more reserves in the ground in the Barents Sea, due to little exploratory success and the assumption that Covid-19 will bring peak oil demand sooner.

Africa

• In Nigeria, after a decade-long debate on oil policy reforms, potential reserves are expected to fall further by 6 billion bbl.
• With no imminent peace in sight in Libya, future production potential falls further by 4 billion bbl.
• Despite positive news on oil policy reforms in Algeria, shale exploration potential is expected to fall by 7 billion bbl of oil.
• In Angola, Rystad forecasts less deepwater exploration as peak oil demand comes sooner due to Covid-19.

Middle East

• As the clear winner of the OPEC+ agreement, Saudi Arabia is expected to add 25 billion bbl to future production potential despite peak oil coming sooner.

Australasia 

• China’s proven reserves are actually up, but future prospective resources are weighed down by low shale exploration, so the net result is negative.
• In Iran, the risk of prolonged sanctions reduces recoverable reserves potential by 18 billion bbl.
• For Australia, Rystad expects reduced exploration in new basins.

Read the article online at: https://www.oilfieldtechnology.com/special-reports/18062020/rystad-energy-covid-19-to-reduce-worlds-recoverable-oil-by-282-billion-bbl/