EIA: ANWR after 2030
Agency’s outlook has Alaska production up through 2041, initially from NPR-A Kristen Nelson Petroleum News
The U.S. Energy Information Administration’s “Annual Energy Outlook 2020” sees U.S. production increasing and setting new records through the mid-2020s, with U.S. crude oil and natural gas plant liquids volumes continuing to grow through 2025 in the reference case. U.S. crude production reaches 14 million barrels per day by 2022 and remains near this level through 2045, EIA said in the report released Jan. 29, “as tight oil development moves into less productive areas and well productivity declines.”
ANWR after 2030 “Alaska crude oil production generally increases through 2041,” EIA said, “driven primarily by the development of fields in the National Petroleum Reserve-Alaska (NPR-A) before 2030, and after 2030, by the development of fields in the 1002 Section of the Arctic National Wildlife Refuge (ANWR). Exploration and development of fields in ANWR is not economical in the Low Oil Price case.”
In the reference or base case, Brent oil reaches $105 per barrel in 2019 dollars by 2050, compared to $183 in the high oil case and $46 in the low oil price.
EIA’s projections for Alaska production, starting from a base of 0.48 million bpd in 2019, are 0.55 million bpd in 2030 at all prices. But by 2040, in the low price case Alaska production is estimated at 0.30 million bpd, compared to 0.83 million in the base case and 1.17 million in the high oil price. The state is estimated to have no production in 2050 in the low price case, 0.48 million bpd in the base case and 0.78 million bpd in the high oil price.
There is also a high oil and gas supply case, reflecting lower costs and greater U.S. oil and natural gas resource availability, allowing more production at lower prices, and a low oil and gas supply case which “assumes fewer resources and higher costs,” EIA said.
Alaska production projections, for 2030, are 0.44 million bpd in the low oil and gas supply case, 0.55 million in the base case and 0.58 million in the high oil and gas supply case. In 2040, projection in the low supply case is 0.46 million, 0.83 million in the base case and 0.99 million in the high supply case. In 2050, in the low supply case the projection is 0.22 million, compared to 0.48 million in the base case and 1.20 million in the high supply case.
US growth through 2025 In the report’s base or reference case, EIA said U.S. crude oil and natural gas plant liquids production continues to grow through 2025, with natural gas plant liquids (liquids extracted from natural gas in processing plants), comprising nearly one-third of cumulative U.S. liquids production in the projection period, which covers 2020-50.
But while U.S. production continues to grow through 2025, EIA said consumption of petroleum and other liquids remains lower than its 2004 peak level through 2050 in most cases (the reference and side cases).
Lower 48 onshore tight oil development continues as the main driver of U.S. crude production, EIA said, accounting for about 70% of cumulative domestic production in the reference case, with the Southwest region leading crude oil production in the U.S. Deepwater discoveries of oil and natural gas in the Gulf of Mexico are the driving factor in offshore Lower 48 production reaching 2.4 million bpd in 2026. “Many of these discoveries occurred during exploration that took place before 2015, when oil prices were higher than $100 per barrel, and they are being developed as oil prices rise,” EIA said.
Exports The U.S. becomes a net energy exporter on an annual basis in 2020, EIA said, and will continue to import and export throughout 2020-50.
In the reference case, EIA said, the U.S. exports more petroleum and other liquids than it imports annually starting in 2020 “as U.S. crude oil production continues to increase and domestic consumption of petroleum products decreases.” After 2047, however, the U.S. is projected to return to importing more petroleum and other liquids than it exports based in increasing domestic gasoline consumption and falling domestic crude oil production.
The U.S. became a net natural gas exporter on an annual basis in 2017, EIA said, and in the reference case the U.S. exports liquefied natural gas to more distant destinations and is projected to remain a net natural gas exporter through 2050.
Uncertainties “Future oil prices are highly uncertain and are subject to international market conditions influenced by factors outside of the National Energy Modeling System (used in the projections),” EIA said. The high oil price and low oil price cases represent “international conditions that could drive prices to extreme, sustained deviations from the Reference case price path,” with higher than expected non-U.S. petroleum and liquids demand and lower-than-expected non-U.S. supply in the high oil price case and the opposite in the low oil price case.
Tight oil and shale gas production is uncertain, EIA said, “because large portions of known formations have relatively little or no production history and extraction technologies and practices continue to evolve rapidly.”
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