US oil execs meet to address supply challenge

12 February 2008 21:19  [Source: ICIS news]

HOUSTON (ICIS news)--Technology, investment, free trade and teamwork are key ingredients needed meet the global oil supply challenge, industry executives said on Tuesday.

“Oil is finite but it is far from finished,” ExxonMobil Senior Vice President Mark Albers said at the Cambridge Energy Research Associates  CERAweek conference in Houston.

Albers said US Geological Survey (USGS) data indicates there is about 3,000bn bbl of oil remain untapped worldwide, a 1,000bn increase from estimates 20 years ago.

“Technology is the lifeblood of this industry when it comes to being able to locate these reserves and improve refinery rates and capacity,” Albers said. 

Albers also said that working with state-owned and non-state-owned companies in a free market was crucial to meeting the supply challenge.

“Resource nationalism slows investors and builds walls,” Albers said. 

State-owned companies would benefit from foreign investments, he said.

“An oil crisis is coming in the next 10 years,” warned Hess Corporation Chairman and CEO John Hess, but added that the situation could be avoided with the conservation of natural resources and moderating demand.

The development of hydrogen cell vehicles and more efficient transportation could also be used to avoid an oil crisis, Hess said.

Hess said more than 50% of oil demand is for automobiles and cited a Goldman Sachs forecast that stated oil demand for vehicles will reach 500m bbl/day in China and 600m bbl/day in India by 2050.

“Hydrogen cell vehicles need to be a reality,” Hess said.

StatoilHydro ASA President and CEO Helge Lund said in addition to current production rates from the Norwegian Continental Shelf (NCS), his company believes there is still growth potential for 3m bbl/day for the next 10 years. However, in order to meet supply needs, he said his company will have to grow outside of the NCS.

By 2012, Lund said 30% of StatoilHydro’s production will be outside of Norway in locations such as the Canadian Oil Sands, Russia and the Gulf of Mexico.

Lund also added that with global warming becoming an issue, new technology is needed to reduce carbons.

Lund said StatoilHydro was working to develop carbon capture and storage facilities in Norway.

The conference runs through Friday. 

By: Brian Balboa
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