The world is wallowing in cheap oil. But the oil industry's most authoritative data shows that Opec is set for a comebackby David Fleming / April 20, 1999 / Leave a comment
Published in April 1999 issue of Prospect Magazine
I have missed my vocation. I should have been a pick-pocket. I like dipping sneakily into heavy tomes full of small print, to see what I come up with. Occasionally I find something extraordinary. The latest issue of the International Energy Agency’s annual publication, World Energy Outlook, is a case in point. It has a story to tell which will profoundly affect the future of every man and woman on earth.
The International Energy Agency (IEA) is the most authoritative body in the field of energy. It was set up in 1974 with an office in Paris; its job is to tell governments what is happening in the oil market, and to publish statistics. The 1998 edition of the Outlook contains a table and a graph which forecast the supply of oil during the first two decades of the next century. Evidently, there are some big expansions in oil production on the way. An investment of “many multibillion” dollars in something called “unidentified unconventional oil,” which stands at zero at the moment, will be producing as much oil as the middle east does today; middle east oil production itself will more than double, as will production of oil from natural gas-known as natural gas liquids. In total, allowing for sources which are in decline, production in 2020 will be about 55 per cent more than it is now, and a reasonable summary of all this might be: “All’s well.”
Then I noticed something odd. The first thing which looks suspicious is this: “unidentified unconventional oil.” What is it? And if it really is “unidentified,” what is it doing in the table? Well, “unconventional” oil is derived from a variety of inconvenient sources. It is extracted from oil shales (oil-sodden rocks) and from oil and tar sands; it is synthesised from coal and gas, and it is produced from vegetation (biomass).
The production of oil from unconventional sources calls for exceptional reserves of patience. For example, in the case of tar sands and shales, you typically ha…