A paper presented by A.M. Samsam Bakhtiari
at the International
Oil Conference
(Copenhagen, Denmark
--- December 10, 2003)
INTRODUCTION
The 'World Oil Production Capacity' (WOCAP)
model was developed over the years 1997-2000 [1]. The first test runs
were made in 2000 and early simulation results became available in 2001.
The model was duly revised in 2002 to introduce politics in OPEC countries;
and in 2003 an attempt was made to usher in geopolitics.
THE WOCAP MODEL
The WOCAP model is a simple mathematical
model of the iterative type, with the year as its basic computing step.
At its very foundation are conventional
oil's global 'Ultimate Recoverable Reserves' (URR) of 1,900 billion
barrels developed by Dr. Colin Campbell [2]. Other relevant inputs are
taken from either the BP PLC databases [3] or the author's personal
sources.
Within WOCAP, the international oil industry
is divided into OPEC and Non-OPEC. OPEC is further subdivided into its
eleven member countries; and Non-OPEC split in eleven regions.
WOCAP's overall structure is presented in Figure 1. As shown, the price
of crude oil is of paramount importance in providing necessary funds
for investment in productive facilities. It goes without saying that
both domestic politics and global geopolitics directly affect the amount
of available oil export revenues eventually allocated to the respective
oil industries. And, in some cases, political considerations overshadow
all other factors.
In consequence, WOCAP's five major factors
influencing oil production capacities are:
(1) Adequate upstream maintenance
of existing installations;
(2) Timely projects of enhanced oil recovery (EOR);
(3) New oil field discoveries (from yet-to-find reserves);
(4) Annual withdrawal from known producing fields;
(5) Political intangibles.
(6) Geopolitical intangibles.
It was the two latter intangibles which
were the focus of the twin 2002 and 2003 revisions, as attempts were
made to introduce the impact of such factors into the productive process
--- a very demanding task, as dealing with intangibles always is a rather
cumbersome process.
WOCAP TEST RUNS
The initial test runs were made to fine-tune
major parameters within the WOCAP model. For OPEC, the study cases of
Iran and Kuwait were chosen for being amply documented; and, for Non-OPEC,
the North Sea region and Russia were selected --- both entities having
rather good sets of supportive production data.
All the tests subsequently evolved into
full-scale simulations and those for the two Non-OPEC cases were duly
published [4,5].
WOCAP WORLD SIMULATIONS
The latest WOCAP Base Case simulation
is shown in Figure 2. The main feature therein is the oil production
peak predicted for the years 2006/2007 at around 81 million b/d (mb/d).
This peak can also be interpreted as being part of the "bumpy plateau"
stretching over the period 2005 to 2008.
Moreover, the Non-OPEC output comes to
peak towards the close of the present decade, after plateauing just
below 50 mb/d. As for OPEC, it peaks in the midst of the next decade
at around 35 mb/d.
In Figure 3, the Base Case simulation
is shown with the error margins added in. As shown, errors could take
the global oil peak to a level ranging between 79.5 and 82.5 mb/d.
CONCLUSION
All in all, the WOCAP model was developed
to predict global oil production levels and capacities for the 21st
century. Its main simulation results clearly show that global oil production
should come to peak during the present decade --- inevitably leading
to a revolution in worldwide energy consumption and societal matters.
References
[1] The WOCAP model was developed by a small team under
the leadership of Miss Behdis Eslamnour.
[2] Dr. Campbell's ASPO databases are to be found at www.peakoil.net
[3] The major BP databases are available at www.bp.com
[4] A.M. Samsam Bakhtiari, 'North Sea oil reserves: half full or half
empty ?', OGJ, August 25, 2003, pp.24-32.
[5] Ibid., 'Expectations of sustained Russian oil production boom unjustified',
OGJ, April 29, 2003, pp.24-26.
