UK Energy Security Background Notes (1)

UK Energy Security has many facets, security of sources of supply, security of transport, security of storage, security of distribution and naturally all this has to be costed into the delivery of the final product to the user.

Future plans also depend upon security i.e accuracy of production data and forecasts based on it. So this analysis of actual forecasts and experience is worth examining.

U.S. Department of Energy / EIA published their International Energy Outlook 2001 (IEO2001) which received some acute and startlingly accurate criticism when published, from Roger D. Blanchard, Northern Kentucky University, 4/9/2001

The EIA report made projections about North Sea Oil output for the UK and Norway...

1. North Sea
EIA - North Sea production reaches a peak in 2006, at almost 6.6 million barrels/day (mb/d).
2. The UK
EIA - The United Kingdom is expected to produce about 3.1 mb/d by the middle of this decade, followed by a decline to 2.7 mb/d by 2020.

To Roger Blanchard this decline in production , "appears totally unrealistic."

2. Norway

EIA - Norwegian production is expected to peak at about 3.7 mb/d in 2004 and then gradually decline to about 3.1 mb/d by the end of the forecast period.

For Roger Blanchard ..."Norwegian crude oil production probably either peaked last year or will this year." ...."The oil discovery rate in Norway has been poor in recent years so as the older fields decline, a steep decline should be expected for Norwegian oil production.

So 5 years on how did the EIA forecasts hold up for the North Sea ?

Well Ron Patterson in the Energy Bulletin revisited the figures in December 2005 .. which Chris Vernon also discussed here at Vital Trivia

NORTH SEA FORECAST "The facts are that the North Sea was already post peak when these words were written. The North sea peaked in 1999 at 5.947 mb/d. For the first nine months of 2005 the North Sea has averaged 4.787 mb/d, 1.16 mb/d below the average for all of 1999, the peak year. And that is over 1.8 mb/d below what they expected the production to be next year. It is almost a lead pipe cinch that by then the North sea will be producing at least 2 mb/d below their predicted 6.6 mb/d, and declining fast."

UK FORECAST The UK peaked in 1999 at 2.684 mb/d and now in the middle of this decade, their expected peak, the UK is producing an average of 1.668 mb/d over 1.4 mb/d or about 46 % below where the EIA expected UK production to be.

NORWEGIAN FORECAST Norway had already peaked in 2000 averaging 3.197 mb/d for that year. So far in 2005 they are averaging 2.72 mb/d, well below the 3.1 mb/d the EIA predicted they would be at in 2020. In fact they are now declining by about 3.3 % per year, a rate that would put them at about 1.6 mb/d in 2020.(EIA 3.1 MBD)

Chris Vernon points out that there website claims

The Energy Information Administration (EIA), created by Congress in 1977, is a statistical agency of the U.S. Department of Energy. They provide policy-independent data, forecasts, and analyses to promote sound policy making, efficient markets, and public understanding regarding energy and its interaction with the economy and the environment.

Why did they get it so wrong ...? Incompetence or a desire to mislead ?

That they got it spectactularly wrong is not in doubt. Roger Blanchard saw it at the time ....