Exxon Foresees Bright Future | Russell T. Rudy Energy LLC
A recent “Rigzone” article summarized Exxon’s annual long-term energy forecast. The company predicts a positive outlook for hydrocarbons in general and for North America in particular. This is quite a reversal for a continent which once was a sponge that sucked up a large part of the world’s oil supply.
Exxon predicts that by the end of this decade North America will be a net liquids exporter, and by 2025, one of the world’s largest suppliers of natural gas. Our increased production will be driven on the supply side by technologies which have enabled the shale revolution, and on the demand side by a global increase in the middle class from 2 billion people to 5 billion. These newly affluent consumers are expected to buy energy hungry devices such as cars and air conditioners. This demand growth will come exclusively from emerging economies, as energy use in developed countries will remain flat or slightly decline.
The company sees this growth in demand for oil and gas developing in spite of environmental concerns about fossil fuel emissions. However, these concerns are seen as driving consumption away from coal to natural gas. In fact, Exxon predicts that natural gas will replace coal as the number two fuel source in the world.
Exxon is bearish on the prospects for renewable energy sources, and sees these as only accounting for 4% of world energy supply by 2040, with oil and natural gas accounting for 32% and 26% respectively. Coal would furnish 19% of the world’s needs and nuclear, biomass and hydroelectric, 11%.
Predictably, environmentalists dispute Exxon’s view of the future. They foresee renewables playing a larger role and being cost competitive with hydrocarbons in the near future. However, Ken Cohen, Exxon’s chief of government and public affairs feels that such views are “not consonant with the facts”. He goes on to say that by the end of the decade, North America will be a net exporter of energy, and that “Limitations are political and policy-related more than technical.”
To read the article in its entirety, please go to www.rigzone.com/news/oil_gas/a/136299/Exxon .
