On the left: the production of historical global gas by one billion cubic meters (in light blue) and the rates of decline if there is no more investment from the years 1980, 1990, etc. On the right: the average annual production loss with no additional investments, depending on the contract. Credit: International Energy Agency.

The International Energy Agency report shows that the result of these accelerating decline rates is that the oil and gas industry already needs “rapid operation to stop”.

It indicates that approximately 90 percent of the annual investment in the sector since 2019 “has been allocated to compensate for production declines instead of meeting demand growth.”

The industry needs to invest about $ 500 billion annually, only to maintain current production, she says.

With investments expected to reach $ 570 billion in 2025, the International Energy Agency indicates that this is sufficient to maintain “modest” growth in production, but only “a slight decrease” away from fixed or declining production.

The International Energy Agency also indicates that there is a delay around the world, on average, for nearly 20 years since the issuance of oil and gas exploration licenses until additional production flow begins. Explain:

“This includes five years on average to discover the field, eight years to evaluate it and agree to its development, and six years to create the necessary infrastructure and start production.”

(In a The last speech The leader of the opposition Conservative Party in the United Kingdom, Kimi Badinoush, pledged to “maximize” oil and gas extract from the North Sea, if elected, the need for new licenses.

Do you need a new investment?

The International Energy Agency report continues to show that without continuing to invest in maintaining production, global oil and gas production will decrease, as shown in the form below.

Global oil production (one million barrels per day, left) and gas (one billion cubic meters, right) if investment stops on the source. Credit: International Energy Agency.

the Financial Times He said that the International Energy Agency report shows the “costly battle” faced by the oil and gas sector if it wants to maintain current production.

However, the newspaper added that the sector will likely welcome the results:

“The results of the International Energy Agency are likely to be enthusiastic by the oil industry, which constantly confirmed that it needs to spend large sums to maintain its current production levels.”

The problem is that the report also shows the consequences of low demand, in a world that limits temperatures to less than 1.5 ° C above pre -industrial levels.

In the “New Zealand scenario that corresponds to a temperature of 1.5 ° C”, the International Energy Agency says that “the great acceleration in the pace of energy transformations compared to the current trends” will lead to a significant decrease in oil and gas demand.

He adds that if this decrease in demand occurs, there will be no need to invest in a new oil and gas production, as shown in the figure below. Specifically, the International Energy Agency report says:

Thus, the frequency of reducing the demand in the Nze (1.5 ° C) scenario is rapid enough, in a total way, no new traditional projects with a long time limit need to agree to development. “

(The International Energy Agency says that even under the “New Zealand scenario” that is compatible with a temperature of 1.5 ° C, there will remain a need for some investment in “existing and accredited” projects to balance the rates of decline).

Global oil and gas production in 2024 (gray line) and in the future without investing (light blue) and with investment in existing and approved projects (dark blue). The request appears under the “Nze scenario” that is compatible with 1.5 ° C by green circles. Credit: International Energy Agency.

Consequently, the new report repeats the assurances of the International Energy Agency The previous result And that there will be no need to invest in new oil and gas if the world reaches a course of 1.5 ° C.

However, it focuses more strongly on the need for a decrease in demand, in order to eliminate the need for new investments, in contrast to the way this result was widely reported.

In covering the results of 2021, for example, Guardian I mentioned that the development of oil and gas “must stop … if the world wants to remain within the safe borders.”

On the contrary, the new International Energy Agency report says that investing in new oil and gas development projects will be necessary to meet the demand, unless the demand decreases significantly in line with the 1.5 ° C.

In addition to clarifying this point more assertive, the International Energy Agency report indicates that a large group of higher -cost oil and gas projects in the world will need early closure – to become actually stuck – if the demand for fuel decreases in line with a 1.5 ° C. She says:

“To ensure a smooth balance between supply and demand, the decrease in demand in the Nze scenario will lead to the early closure of many higher cost projects before it reaches the end of its artistic life. In 2050, for example, about 8 million barrels per day will be withdrawn from oil production and 250 billion cubic meters of gas production in a early time than what may suggest the noticeable decline rates.”

This story was published with permission from Carbon summary.