Quick Update on CERA 2005 projects

I am slowly working on a bottom-up production model. As I trawl through endless oilfield development updates, I thought it might be useful to capture some of what I'm finding out in manageable chunks. So here's a quick status update on the projects that Heading Out documented from CERA's list for 2005.

  1. Bonga is delayed from September to November for first oil.
  2. Kizomba B came on in July, 6 months ahead of schedule.
  3. Albacora Leste, a year behind it's original schedule, is supposed to have started right around now, but I can't find confirmation of it's status.
  4. White Rose is on track to start any day, if it hasn't
  5. Thunder Horse is delayed into next year, due to the hurricane.
  6. Dharkoein in Iran, appears to have 50000 bpd as of July, and to be headed for 160000 bpd by December of next year.
  7. Adar Yeil/Tale was supposed to come on with first oil towards 200000 bpd this year and 300000 bpd by the end of next year. Looks like that's on track for about July first oil. However, it should be realized that this whole area of Sudan has been incredibly unstable, which is why this field, discovered in 1981, hasn't been developed before. The war reportedly began because the government wanted to clear all the local people away from the oilfields.
  8. Primorsk is a port, and HO was uncertain whether CERA meant Priobskoye (which ODAC lists for 2004) or Prirazlomnoye (ODAC has it for 2005). Priobskoye turns out to be a continuously producing field that Sibneft has been reworking. So I don't think it makes sense to count it as a new field. Prirazlomnoye is the first Barents Sea Arctic field. It is not going to happen in 2005 (they haven't towed the platform to the field yet), and is not looking too certain for 2006 either. This may be the most significant data point, because once we are done with the deep water, polar oil is about the only thing left to go get, so it's of considerable significance whether or not we can figure out how.
  9. Sakhalin I is producing oil, but the infrastructure to export that oil will not be ready until the first quarter of 2006. It will be ramping up production to reach 250000 bpd by the end of 2006. Gas is being exported already.
  10. The ACG Megastructure has been producing for a little while, with the Chirag early oil project running at about 140000 bpd, but the main bulk of the project started to come on line in Feb of this year, with phase I taking this year up to about 410,000 bpd for this year. Phase II will take that up to 800000 bpd, and it's expected to reach 1m bpd by 2010. We don't count the Chirag part that's been running since 1997 as a new project here.
My estimated production profiles for the high case is up top, and for the low case is just below. I welcome any other insights or corrections. For anyone who wants to see more detail, here's the work-in-progress spreadsheet.

Missing in Action:

Kizomba A
Shah Deniz
Sakhaliin II
Mad Dog

That's off the top of my head, late on a Friday. I'll update tommorrow.

Mmmm. You need to go back and read Heading Out's post to understand the history. We broke the projects down into groups according to the years CERA had them coming on board. I'm dealing with one of those groups at a time (for the sake of not doing something unmanageably large in one piece). So my list is correct in context. However, I'll definitely grab your list to make sure they get taken care of in some group at some point.
With the possible caveat that we don't really know what CERA meant by "Primorsk".
Primorsk is a oil terminal located on the Gulf of Finland. Since Soviet union collapsed Russia lost some of its pipelines and part of its ability to export crude. Pipelines in Russia are operating at full capasity and they are for example exporting crude to China via train gargo. If they had more capacity they could export more. Russia has plans to increase pipeline capasity and terminal capacity to increase exports. So maybe Primorsk expanding project is what CERA sees as increased production. In quick search I couldnt find much info on expanding plans, heres few links tho:

   During my trip to Russia in summer we drove from st. Petersburg to Vyborg via costline and stopped in Primorsk just to have a look at the terminal (which was of course my idea , others didnt care so much of the terminal which exports most of our crude oil we use in Finland). Well we didnt see so much just the facility and many tankers.  Here in Finland increasing tanker traffic is in the news quite often. There is fear of possible tanker accident and what it might cause to ocean which is already one of the most polluted in the world. In winter time when gulf is frozen , tankers need occasionally icebraker to make the trip, sometimes they get stuck on the ice for weeks.  Finland is trying to pressure Russia to require double-hulled tankers for oil transports.

You're probably right, although it doesn't seem quite methodologically sound to count this as new fields, rather than some old fields increasing their production -- as much of Russia has been doing as they rework things with horizontal wells and frac jobs. This Sibneft page was pretty enlightening. Especially the way that Sibneft's production almost exactly tracks the curve of overall Russian production. It seems to confirm the hypothesis that this is going to end up like the North Sea - big rise in production for a while followed by a crash with very high decline rates.
On Russian oil, I can only recommend this article:

http://www.cdi.org/russia/johnson/8236-12.cfm by Leslie Dienes.

Gotcha. Just did't understand the initial methodology. I'm wraped up today but I can post a more copmprehensive list Sunday. I'll be using the Offshore Engineer survey from a few months back
While we're talking about future supply this may be of interest...

From EnergyBulletin
Sadad al Husseini sees peak in 2015
Steve Andrews, ASPO-USA
While al Husseini's comments about when peak oil might hit us are more optimistic than those of ASPO-Ireland and a host of others, they certainly strike a vastly more realistic chord than the typical fare from Saudi Aramco press releases and presentations. [see article for the rest]

there is a good chance that someone has talked about this already, and it is slightly off topic, but i wanted to post where it might get the most views.

over at mobjectivist(in the blogroll section)there is a pretty disturbing world cumulative production projection.

i was just wondering if someone at this site could provide some educated commentary on the graph and its assumptions. it seems there are a lot more commentators here than at mobjectivist.

i wont comment too much since there are others much more qualified to do so, but if that graph is right, it seems that we would be getting off lightly with a 30 year depression. or maybe this is wrong also, and the graph looks more severe than it really is?

This is nothing to do with CERA but I came across this excellent article about peak oil from Robert Alan Feldman, an economist at Morgan Stanley. He obviously gets it. The link is http://www.morganstanley.com/GEFdata/digests/latest-digest.html

You want the Global Economic Forum for the 7th October. If it's not visible click on the Archive link and select it from the calendar. The article you want is called 'Global: The Oil Debate Converges (Partly)'. I won't post the article as I don't know the copyright implications.

Sounds like you are putting a lot of pain-staking work into this project, Stuart.  Thanks for the effort.
Bonga may come on in November of 2005, but I wouldn't hold my breath. Depending on how far back you started measuring, you could say this project is already delayed 5 years.

In your 2006 projects, you might want to add Mars but put it in as a negative wedge starting in September of 2005.

Do you know why they've had so much grief with Bonga? I'll push them further back in my low case, but take them at their word in the high case.
From the graph we can see that most (about 1.5 - 2 mbpd) of the projected increase will come pretty soon, 2005 - 2007. 2008 - 2011 increase will be less than 1 mbpd. This means for the overall oil peak may come already 2007 because the yearly increase after that from these projects will be only about 300 000 bpd. That may not offset the depletion at that stage.

All this is just guessing. For me this seems to confirm the view that Russia and Saudi-Arabia will be decisive. They can unexpectedly show such a depeletion rate that those new projects cannot help.

Besides the even most optimistic forecast here doesn't spell much growth (under 2%) in the world production anyway. So we could reasonably expect rather flat production in the next few years.  

I think it's quite hard to conclude much about the global situation from this picture alone. We would need to superimpose what the "class of 02", "class of 03", "class of 04" have been doing, and how the 06, 07, etc projects are shaping up. We also need to get a better sense of whether there's a long tail of small fields that contributes materially or not (Rembrandt Koppelaar has listed some small fields, and maybe Mad Oilman will give us some more). I'm mostly putting the update up now in hope of attracting some corrections and additional pointers, and for the benefit of anyone else who wants to do micro-level tracking of the world's oil supply.

I suppose it's somewhat valid to ask whether we believe the 2-2.5mbpd eventually coming from CERA's class of 05 is enough to offset type II depletion in the rest of the worlds existing fields in 05 - if they are, in aggregate, declining at more than 2 1/2% to 3%, then one could argue we are starting to go backwards. But this is tricky - some recent fields will still be growing, while older ones are declining. And I don't want to conclude that the small fields don't count significantly at present. Also, in a sense it's really the class of 02-04 that will be fully hitting their peaks around now and either offsetting this year's declines or not (it's the difference between accrual accounting and cashflow accounting for those who know some accounting - but I think cashflow - oilflow - is relevant here: we can't power our cars with future oil).

I was somewhat positively surprised by ACG. Looks like Azerbaijan is about to enter the positive column in this picture in a pretty big way:

There are some dry holes in the Caspian. Azerbaijan from EIA.
Besides the ACG project, many of Azerbaijan's offshore prospects have been relatively disappointing in contrast to the high expectations for the Caspian Sea region during the 1990s.

Most recently, the failure of ExxonMobil and Lukoil to discover commercially viable hydrocarbon reserves at the Zafar-Mashal and Yalama blocks, respectively, will lower future production estimates from Azerbaijan's offshore area. The first well at Zafar-Mashal was the deepest in the Caspian Sea, reaching a total depth of over 22,000 feet (6,600 meters) and was the most expensive at around $100 million. The Yalama Block was the last drilling program underway in offshore Azerbaijan. Finally, without an agreement on the maritime borders in the Caspian Sea, entire fields have been left untapped due to the lack of clarity on ownership.
There continue to be large discrepancies in recoverable reserve numbers for this region. I think the overall view is that earlier large numbers were not justified. There's a good summary here if people are interested. This is another good candidate for a Hubbert linearisation plot.
Yeah - I'm just saying the ACG looks pretty solid, and a new 1mbpd is not to be sniffed at right now.
You are correct. Many majors and their partners have let their leases lapse as the risk/reward equation wasn't quite working out in Azerbaijan. BP is doing well with their ACG and Shah Deniz projects, but that's about it.

Khazakstan is perking up quite nicely. I've been involved with a major artificial island project (for environmental reasons) to produce at minimum a billion barrel field.

But Iran is still causing problems. Their claim to Caspian acerage is far beyond reason. And international precedent. And negotiations between the major players are non-existent. It is holding up major production opportunities.

Iran is probably content to see these resources come on line much later, given that only a small share will ultimately go to them, and helpfully increasing their revenues from their current production.
Kazakhstan seems to be missing from your list.

  • Kashagan, due to start in 2008 now, with 50-80 kb/d initially, and 450 kb/d after a few years

  • Tengiz, production due to ramp up from 280 kb/d to 700 kb/d, under way

  • Karachaganak, liquids production due to ramp up from 240 kb/d to close to 500 kb/d.
This particular group is just intended to be projects CERA had listed coming on on in 2005. It's not exhaustive of all fields. I'll make sure these get accounted for somewhere.
I see that Tengiz is listed in the CERA report (which I actually have in full) for 2006, but I don't see the other two.

I saw the initial post you had on this topic. Are there others around (with other years)?

Heading Out listed the CERA projects for 2006, and 2007. I am researching production models for their 2006 projects now. I plan to eventually get to projects that CERA has missed, so any you point me to is good.
About Albacora Leste. The P-50 platform will be installed in the field early in november, according to this article (in portuguese) citing declarations from the president of Petrobrás. Also, the P-34 platform, destined to Jubarte (60000 bpd) is delayed until early next year.
Thanks, that's very helpful - I'll push them back a bit.
There is an interesting item from Vital Trivia.

OPEC Reveals Global Light Sweet Crude Peaked.

Saudi is not just paying very high rates for rigs that will drill for heavy/sour - they are also investing in expensive refineries to process it. It does seem they might not be sitting on a sea of undeveloped sweet/light.

I thought Sakhalin was gas - is your chart showing ng liquids?
So we passed peak sweet/light (PSW) some time ago.
APSO has revised to show PO delayed. Meanwhile they have a very detailed description of the increasingly heavy/sour production. Has anybody tried to calculate the overall effect on gasoline/kerosene production? Might overall liquids production increase, delaying PO, while product decreases, meaning we pass PG and PK? Maybe PD comes a bit later?

Since the differential between sweet light crude and heavy sour crude is becoming more important in determining how the coming oil crisis is likely to play, would it be a good idea to add a heavy sour crude to the charts on the side bar if one is available on line.
Sakhalin I and II both have oil and gas. I count condensates in with oil where the number is available.
Stuart, this is a tremendously valuable service. Thanks for the effort. Once 2005/6/7 are done it might be useful to rework the global effect for delays like for Thunderhorse. Is that part of your plan? Do you have this material in spreadsheet form, and if yes can you make it available?  Murray