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THE ENERGY CLIFF APPROACHES: World Oil & Gas Discoveries Continue To Decline

Geology

As the world continues to burn energy like there is no tomorrow, global oil and gas discoveries fell to another low in 2017.  And to make matters worse, world oil investment has dropped 45% from its peak in 2014.  If the world oil industry doesn’t increase its capital expenditures significantly, we are going to hit the Energy Cliff much sooner than later.

According to Rystad Energy, total global conventional oil and gas discoveries fell to a low of 6.7 billion barrels of oil equivalent (Boe).  To arrive at a Boe, Rystad Energy converts natural gas to a barrel of oil equivalent.  In 2012, the world discovered 30 billion Boe of oil and gas versus the 6.7 billion Boe last year:

In the article, All-time low for discovered resources in 2017, Rystad reports, it stated the following:

“We haven’t seen anything like this since the 1940s,” says Sonia Mladá Passos, senior analyst at Rystad Energy. “The discovered volumes averaged at ~550 MMboe per month. The most worrisome is the fact that the reserve replacement ratio in the current year reached only 11% (for oil and gas combined) – compared to over 50% in 2012.” According to Rystad’s analysis, 2006 was the last year when reserve replacement ratio reached 100%.

The critical information in the quote above is that the world only replaced 11% of its oil and gas consumption last year compared to 50% in 2012.  However, the article goes on to say that the last time global oil and gas discoveries were 100% of consumption was back in 2006.  So, even at high $100+ oil prices in 2013 and 2014, oil and gas discoveries were only 25% of global consumption.

As I mentioned at the beginning of the article, global oil capital investment has fallen right at the very time we need it the most.  In the EIA’s International Energy Outlook 2017, world oil capital investment fell 45% to $316 billion in 2016 versus $578 billion in 2014:

In just ten years (2007-2016), the world oil industry spent $4.1 trillion to maintain and grow production.  However, as shown in the first chart, global conventional oil and gas discoveries fell to a new low of 6.7 billion Boe in 2017.  So, even though more money is being spent, the world isn’t finding much more new oil.

I believe we are going to start running into serious trouble, first in the U.S. Shale Energy Industry, and then globally, within the next 1-3 years.  The major global oil companies have been forced to cut capital expenditures to remain profitable and to provide free cash flow.  Unfortunately, this will impact oil production in the coming years.

Thus, the world will be facing the Energy Cliff much sooner than later.

by SRSrocco Report, Zerohedge



84 Comments on "THE ENERGY CLIFF APPROACHES: World Oil & Gas Discoveries Continue To Decline"

  1. MASTERMIND on Sun, 8th Jul 2018 5:59 pm 

    Davy

    Don’t change the subject back to me..Answer the question you chump..

    Who are these blind liberal liars and what did they lie about?

  2. MASTERMIND on Sun, 8th Jul 2018 6:00 pm 

    Davy

    You know your days are numbered soon..You fear change and big change is coming..

  3. MASTERMIND on Sun, 8th Jul 2018 6:03 pm 

    Juan

    Putin is the next Saddam or Muammar Gaddafi..He is going to end up sodomized with a blade like Muarmmar did..

    LMFAO!

  4. Davy on Sun, 8th Jul 2018 6:03 pm 

    mm, use your colorful imagination idiot.

  5. Davy on Sun, 8th Jul 2018 6:07 pm 

    Putin is likely the most secure leader in the world. It appears he has the entire Russian security services and military fully behind him. The Russian people love him. The world respects him. mm keep showing how stupid you really are by trashing Putin.

  6. MASTERMIND on Sun, 8th Jul 2018 6:21 pm 

    Davy

    Who are these lying liberals? You paranoid nut job?

    And keep sucking Putin’s dick you soy boy..

    Putin is a wanted man and he will be neutralized..

    What about Snowden? He called Putin corrupt..And his elections are hacked you dumbshit idiot..

  7. MASTERMIND on Sun, 8th Jul 2018 6:24 pm 

    Davy

    You are the elites lap dog..And your days of living the high life are coming to a close..I mean the change that is coming to you..Is not something to be anticipated!

  8. Davy on Sun, 8th Jul 2018 6:35 pm 

    mm, you tell everyone that. I think it is really you that is sucking eggs. You blew all your savings on a manic episode and now you are about to the point where you will have to go back to work. LMFAO. You took a gamble and lost. How are you with flipping burgers?

  9. MASTERMIND on Sun, 8th Jul 2018 7:03 pm 

    Davy

    I didn’t blow all my money..I made around 86k a year working for AT&T when I got out of college for five years..I put away over 50k in savings in under two years..I was the top salesman in the state of Michigan for two years in a row..

    And you will see when shit hits the fan in a few years that my choice to live large now..was an genius decision..

  10. Davy on Sun, 8th Jul 2018 7:08 pm 

    you are a friggin liar. You told us you where a PHD teaching chemistry. You don’t know what you are anymore. I think you are in a mental facility and hogging the internet from decent people trying to get well.

  11. Makati1 on Sun, 8th Jul 2018 7:16 pm 

    Sounds more like you, talking to your sock puppet MM. LOL

  12. MASTERMIND on Sun, 8th Jul 2018 7:22 pm 

    Davy

    I have been out of college for more than five years..I saved up a large amount after school and don’t work for AT&T anymore..If you wouldn’t assume things for no reason..I wouldnt have to correct you..

  13. GregT on Sun, 8th Jul 2018 7:27 pm 

    “And you will see when shit hits the fan in a few years that my choice to live large now..was an genius decision..”

    Spending every waking hour of your life trolling Internet forums isn’t exactly living large MM, and it definitely is not a genius decision.

  14. GregT on Sun, 8th Jul 2018 7:29 pm 

    Davy/MM,

    Would you please stop filling this forum up with your childish, idiotic, nonsense.

  15. JuanP on Sun, 8th Jul 2018 7:30 pm 

    MM “What about Snowden? He called Putin corrupt..And his elections are hacked you dumbshit idiot..”
    You do know that Snowden lives in Russia, right? Greenwald was visiting him in Moscow last week! LOL! And, Putin is the most popular leader living in the world today. His popularity, both at home and abroad, is unequaled according to polls from all over the world. If you really believe those lies you write, Attomind, then you are a fucking brainwashed moron! LOL!

  16. MASTERMIND on Sun, 8th Jul 2018 7:32 pm 

    Car salesman meme

    https://i.imgur.com/a8lRf8F.jpg

    LMFAO!

  17. MASTERMIND on Sun, 8th Jul 2018 7:33 pm 

    Juan

    If you want to be wrong, then follow the masses..

    -Socrates

  18. Makati1 on Sun, 8th Jul 2018 7:38 pm 

    MM and Davy are both insane. That is, maybe they are just one skityzo delusionist? The imperial brainwashing has been very successful. Goebbels would be envious if he lived now.

  19. JuanP on Sun, 8th Jul 2018 7:43 pm 

    That is a nice quote, MM. Ironic coming from you, though! LOL!

  20. Makati1 on Sun, 8th Jul 2018 7:46 pm 

    MM isn’t even smart enough to get your point, Juan. Sheep don’t even think about being part of the herd.

  21. MASTERMIND on Sun, 8th Jul 2018 7:53 pm 

    British MP, establishment journalists rush for Putin’s blood after Amesbury chemical death

    https://www.rt.com/uk/432347-sturgess-death-russia-putin/

    Putin murdered an innocent British woman..May must act and she must be swift!

    HIT HIM HARD!

  22. MASTERMIND on Sun, 8th Jul 2018 7:57 pm 

    Read the comment section of this article on zerohedge..A total basket case full of nutjobs arguing oil is abontic..LOL

  23. JuanP on Sun, 8th Jul 2018 8:00 pm 

    So, MM, you went to school all your life to work for five years and save $50,000, while still owing more than twice that in school loans, then wasted your savings trolling the internet, and you consider yourself a genius?

    I made more money than you and saved more, too, in my first year working in the USA, though I got paid abroad. I was at the time a 20 years old high school dropout immigrant. I admit that It was pure luck, though, because I landed an amazing job working for one of the largest multinationals in the world thanks to a friend. That is what brought me to the USA the first time. After that, I kept working and saving and retired at age 46. I consider myself smart, but no genius.

  24. Antius on Mon, 9th Jul 2018 6:37 am 

    Interesting piece on oil sand extraction:

    https://oilprice.com/Energy/Energy-General/Is-This-The-Oil-Tech-Breakthrough-Of-The-Decade.html

    Whilst there is little hope of this being scaled to 10million barrels per day, it does suggest that some residual US oil production could continue decades or even centuries into the future. The same is probably true of Canadian and Venezuelan oil.

    We just need to be a bit more sensible about our expectations. A US oil demand some 20% of its present value, using hybrid vehicles, railways and coaches for travel, along with a slow transition to more pleasant, walkable, European style cities, is an achievable goal. It would allow the US to keep most if not all ‘living standards’ and gain other things, like a healthier environment and better quality of life along the way. This is James Kunstler’s dream and it is a good one.

    If we had collectively recognised the crisis in the 1990s, it would have been much easier making than transition than it is now going to be.

  25. Cloggie on Mon, 9th Jul 2018 2:33 pm 

    “Interesting piece on oil sand extraction:”

    More third carbon age potential.

  26. MASTERMIND on Mon, 9th Jul 2018 3:10 pm 

    Clogg

    You swallow the propaganda like mothers milk..

  27. MASTERMIND on Mon, 9th Jul 2018 3:15 pm 

    “Brexit dream dying, Johnson says, as he resigns.” Excellent news. If ever a squalid, ignoble “deam” deserved to die it is Brexit, The word dream is normally used of something noble, uplifting, idealistic, not this nasty, jingoistic, xenophobic, Farageist Little-Englandism.

    -Richard Dawkins

  28. Cloggie on Mon, 9th Jul 2018 3:48 pm 

    You can’t get it more British, more cut-throat than this. It is the British original of House of Cards that is being rehashed, like in the Thatcher years, and always centered around the Conservative party:

    https://youtu.be/WMRUHGnN29s

    One of the very few series I saw twice:

    https://en.wikipedia.org/wiki/House_of_Cards_(UK_TV_series)

    25 years before the US copy, another binge-watch oppertunity, but only once, as between 1990-2015 I have somewhat distanced myself from Anglosphere, especially from the folks who run the place, which came hand-in-hand with morphing from a “liberal” into a right-winger.

  29. Cloggie on Mon, 9th Jul 2018 3:53 pm 

    May has a new FM, Hunt, a Remainer:

    http://www.dailymail.co.uk/news/article-5935371/Jeremy-Hunt-Foreign-Secretary-Boris-Johnson.html

    Expect Boris J. frantically making phone calls from his appartment, plotting for the downfall of May, so he can take her place.

    http://www.dailymail.co.uk/news/article-5934573/Boris-Johnson-fire-walking-Cabinet.html

  30. MASTERMIND on Mon, 9th Jul 2018 3:54 pm 

    Clogg

    Europe doesn’t have an immigration problem.. It has a “Life didn’t turn out the way I wanted, so I blame other people problem”..

  31. Boat on Mon, 9th Jul 2018 5:18 pm 

    Mm

    The earth is overpopulated. Immigration is one of the major factors. Go find a study. I got an A on a paper in 1975 discussing immigration. Hmmmmm if we had reacted back then………not a new problem.

  32. Cloggie on Mon, 9th Jul 2018 11:49 pm 

    I really enjoy the fact that you dislike Putin and want him gone, Attomind. I can’t help but smile every time I think of how he annoys you.

    Putin sabotages the US empire and is successful in its attempts to stay out of it. Millimind hates that. Instead the empire is in a process of full disintegration, thanks to the saboteur DJT in the middle of it, who encourages Europe to escape. When Trump will be gone, we’ll be living in a different geopolitical world and the old-school West will be history:

    http://www.spiegel.de/international/germany/former-german-foreign-minister-american-president-is-destroying-american-order-a-1208549.html

    Poor Millimind, all the work of over a century by his tribe, down the drain.

    https://en.wikisource.org/wiki/The_International_Jew

  33. Cloggie on Tue, 10th Jul 2018 12:02 am 

    I got an A on a paper in 1975 discussing immigration. Hmmmmm if we had reacted back then………not a new problem.

    It is not a “problem” that happened out of the blue, boat. It was a successful attempt by your betters to destroy your society since 1965:

    http://www.kevinmacdonald.net/immigration.pdf

    What an iconic picture this is: after he had successfully wasted JFK, LBJ-kike signs the suicide note, or rather execution order of white America in 1965:

    https://goo.gl/images/WRTHFA

    Now you are facing the choice boat: you either rise up and brake the joint up or descend in an Orwellian nightmare of neo-Soviet proportions, with the Constitution abolished and your white ass completely at the mercy of the millimind’s of this world (“mercy” as in: none whatsoever):

    https://documents1940.wordpress.com/2017/10/26/the-new-america/

    You better be nice to your “fashy” continental Yuropean ancestors, we are the only hope left for you. Europe is going “thirties” again, but this time with Russia on our side, so don’t get any ideas about “liberating” us again:

    https://www.youtube.com/watch?v=1jt9MLdg3JQ

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