Marginal Oil - What is driving oil companies dirtier and deeper?

 

PUBLICATION

Marginal Oil - What is driving oil companies dirtier and deeper?

With conventional oil production in decline, the global oil industry is investing heavily in dirtier and riskier forms of unconventional oil such as heavy crude, tar sands, and oil shale. These investments pose a challenge to the climate, the environment, and local communities. This paper is a document that describes the drivers behind marginal oil investments and gives an overview of existing and potential projects across the globe. It contains important analysis that should be public knowledge and will productively feed the ongoing debate, from Cancun to Durban to Rio and beyond.
 
 
 
 
Product details
Date of Publication
May 2011
Publisher
Heinrich Böll Foundation
Number of Pages
44
Licence
Table of contents

Preface 1
Executive Summary 4
Introduction 5
1 Driving over the cliff: What’s behind the increasing exploitation of marginal oil? 8
1.1 International oil companies: The problem of diminishing “easy oil” 9
1.2 Decreasing access for IOCs 9
1.3 Continuing resource nationalism: An increasingly harder bargain for IOCs 9
1.4 Friendly, stable fields in decline 10
1.5 The challenge from “international” NOCs and service companies 10
1.6 Investor pressure: Is the tail wagging the dog? 11
1.7 Growing in the margins 13
1.8 Increasingly marginal reserves 15
1.9 Energy security – Does marginal oil really bring security? 18
1.9.1 Energy Security Argument No. 1: Marginal oil from non-OPEC sources reduces the power of the OPEC cartel 18
1.9.2 Energy Security Argument No. 2: More marginal oil is less money for unsavory regimes and sponsors of terrorism 18
1.9.3 Energy Security Argument No. 3: Marginal oil protects oil importers from “oil as a political weapon” and supply crises 19
1.10 Supply and demand: Hard truths or convenient assumptions? 19
1.11 China leading demand growth 20
1.12 Tight supply and demand triggers policy shifts 20
1.13 Declining demand will hit marginal oil first 20
1.14 “Business as usual” or “business as urgently required”? 20
1.15 Getting behind demand reduction: The key to killing marginal oil? 22
2 Key marginal oil developments: A brief survey 23
2.1 Bitumen and extra-heavy oil 24
2.2 Tar sands in Africa 27
2.3 Marginal oil in sub-Saharan Africa: Onshore and offshore “frontier” oil 28
2.4 Deepwater investments 29
3 Conclusion: Protecting the global climate, local communities and ecologies 33
Endnotes 34
Acknowledgements 40
List of Abbreviations 40