As the demand for energy continues to grow, the global oil and gas industry undergoes profound changes and technological advances in upstream, midstream and downstream operations plays a significant role to meet long-term growth challenges and make energy more abundant for decades to come.
According to OPEC’s latest report ‘World Oil Market Outlook’, primary energy demand is set to increase 35% globally by 2040. Oil is expected to remain a fuel of choice with the largest share in the global energy mix. Long-term demand of oil has been revised upward by 1.7 million barrels a day (mb/d) with total demand estimated to be over 111 mb/d by 2040.
In the period to 2040, OPEC estimates that investment of $10.5 trillion is required for the global oil sector. It says about $300 billion was scaled back from exploration and production in 2015 and 2016 to offset the impact of low oil prices. The contracts awarded in the MENA region were dropped to an eight-year low in 2016. However, national oil companies in GCC managed to secure funding for new investments thus making up for declined revenues.
Saudi Aramco, the world’s largest oil exporter, plans to invest $334 billion over the next decade to sustain oil and gas production. The company plans to raise its oil and gas well count to 1,000 and 500 by 2020 from 850 and 300 in 2015.
The crude oil will continue to back the world’s energy demand. However, offshore oil and gas exploration is becoming increasingly challenging as fields are now technically mature, which require cost-intensive techniques to maintain sufficient pressure within the fields to push up oil from difficult traps. Tertiary recovery techniques like Enhanced Oil Recovery (EOR) remains at the forefront to achieve optimum production. The EOR market is expected to increase at a CAGR of 20.4% in the period 2014-2020.
A number of EOR technologies currently in operation are based primarily on miscible gas injection (MGI), chemical and thermal techniques. The IEA has introduced EOR Technology Collaboration Program (TCP) to reduce costs of existing technologies and to explore innovative methods to boost up production.
Initiatives have been taken to increase oil recovery to ensure long-term productivity, maximize profitability and reach a target of up to 70% at the end of field’s life given that at present the global average recovery factor is up to 40% from mature oil reservoirs.
Environmental benefits along with the adoption of Carbon Capture, Use and Storage (CCUS) is augmenting the upstream industry. CO2 injection in EOR is providing a value-added market for the use of carbon dioxide emitted from industries.
The medium-to-long-term challenges necessitate considerable investments in technologies and research in the years ahead to develop new capacity and restore balance on a sustainable basis.