Oil’s time in the sun has yet to pass and will continue to play an essential part in global energy, even as climate change poses increasing dangers.
Technology innovations and more efficient exploration techniques continue to expand the world’s proven oil reserves, enabling us to tap reservoirs that were not economically feasible before.
Unconventional deposits refers to deposits that require special techniques or costly extraction processes for their extraction, such as shale oil, tight oil or oil sands deposits.
Recent years have witnessed an astounding surge in unconventional oil production, particularly from US shale gas fields. This development could pose a threat to climate change mitigation initiatives; more available supplies may lead to continued or increased consumption, potentially contributing to ‘carbon lock-in’.
Petroleum deposits generally form over millions of years, beginning underground in source rocks before gradually moving toward the surface within porous and permeable reservoir rock and, eventually being discovered as commercial resources.
However, the extraction of conventional and unconventional petroleum resources can be affected by various geological circumstances, physics laws, technologies and economic decisions. Hydraulic fracturing techniques represent a major technological advance that increases permeability while stimulating natural fracture systems to promote reservoir drainage and hydrocarbon production.
Carbon Capture and Storage (CCS)
Carbon capture and storage (CCS) technology helps prevent carbon dioxide (CO2) emissions from being released into the atmosphere, helping the world reach its goal of keeping global warming below two degrees.
Carbon capture technology can also be used to remove CO2 emissions that have already been released through direct air capture and storage (DACCS) or bioenergy with carbon capture and storage (BECCS). Capturing carbon from industrial processes is essential to moving towards a low-carbon economy.
CCS (Carbon Capture and Storage) refers to capturing, transporting and storing carbon emissions underground geological reserves such as natural gas reservoirs, saline aquifers or coal beds which have not yet been exploited by mining activities.
Oil companies have seen substantial benefits from CCS, particularly through enhanced oil recovery (EOR). EOR involves injecting carbon dioxide (CO2) into depleted fields in order to increase extraction rates, which has lead to both increased production as well as an increase in carbon emissions when that oil is burned off.
Bloomberg New Energy Finance’s (BNEF) latest data show EVs have made an enormous dent in oil use, displace 1.5 million barrels per day – more than double their share from 2015.
While the displacement may seem minor, it represents a substantial portion of oil demand and could play a vital role in whether our 1.5deg Celsius target can be met or not.
Electric car market growth looks poised to explode thanks to cheaper battery costs and expanded support policies and charging infrastructure, according to BNEF. Electric cars may soon become as affordable for consumers as gasoline-powered cars in terms of cost and availability, according to their analysis.
CreditSights predicted that as a result of these advances in electric propulsion technology, certain oil and gas companies will experience an uptick in sales of e-trucks and generators – though this won’t be the end of it all.
As oil industry executives look for ways to reduce greenhouse gas emissions, alternative fuels have gained widespread traction as an effective solution. These fuels, typically non-petroleum-based alternatives such as biofuels, advanced diesel, natural gas, hydrogen for fuel cells and electricity from renewable sources are becoming more and more appealing alternatives to petroleum-based ones.
Future success of the global biofuel industry depends on many variables. These include costs associated with oil, feedstock prices, government support for mitigating profit uncertainty and technological breakthroughs that may reduce costs.
Biofuels offer several distinct advantages over petroleum in the transportation market, with their ability to compete directly against petroleum in vehicles with increased energy efficiency and lower carbon dioxide emissions. They can be blended into existing gasoline technology for maximum effect.
Flex-fuel vehicles (or “flex-fuels”) offer fleet operators’s an economical alternative that runs on between 10% to 86% ethanol mixed in with regular gasoline, making it suitable for heavy duty trucks as well as light duty passenger cars.