HOUSTON – U.S. energy production will far outpace its consumption by 2035 as growth in demand for natural gas and renewable sources eclipse the use of oil and coal, according to a new report from BP.
Dwindling oil and coal consumption also will curb the nation’s carbon emissions to a point the U.S. has not seen in three decades, and the use of renewable power sources will triple over that time, BP said Wednesday in its fourth outlook on the world’s energy position beyond 2030.
Natural gas, the British oil giant predicted, would overtake oil as the country’s most used fuel by 2027 and would account for 35 percent of the country’s consumption in 2035.
“Natural gas is the big ticket item,” said Christof Rühl, chief economist for BP Group, said in a teleconference with reporters this week. “We think shale gas will grow up to 21 percent (of global energy production) by 2035.”
Meanwhile, oil is expected to drop from 36 percent to 29 percent of U.S. energy consumption and renewable power sources will grow from 2 percent of energy demand in 2012 to 8 percent in 2035, BP predicted.
U.S. energy trade
North America’s shift to energy self-sufficiency starting around 2018 will cause massive changes in the global energy trading system as the continent becomes a large player in liquefied natural gas exports, increasing worldwide competition and leaving Asia as the largest buyer on the planet, Rühl said.
The U.S. is set, he said, to become the second-largest LNG exporter in the world by 2035, following Australia, which will likely surpass the current top LNG exporter, Qatar. The U.S. will make 101 percent of the energy resources it uses in 2035, up from 69 percent in 2005, according to BP.
Advances in technology, higher investments and policy changes, BP predicts, will boost tight oil production to 7 percent of global oil output by 2035 — a remarkable change after North American oil producers discovered how to reach the resource a few years ago, he said.
U.S. oil imports, BP said, will drop by 75 percent to its lowest level ever over the next two decades, and by 2017, the country will export more natural gas than it imports.
U.S. output of oil and natural gas are expected to grow 37 percent and 45 percent, respectively, while coal production declines by a fifth. The nation’s oil production, BP said, will grow past its peak in 1970 as tight oil triples to 4.5 million barrels per day in 2035. Shale gas, meanwhile, could double to 65 billion cubic feet per day.
“I think the theory of peak oil has peaked, actually,” said Bob Dudley, chief executive of BP, during a live webcast Wednesday in London. Peak oil adherents contend that global production soon will reach its highest level, and then begin a gradual, permanent decline.
Dudley said BP has been able to pick up on several new energy trends by pushing its forecast horizon to 2035.
“It’s important to give the crystal ball a good shake up,” as major changes affecting the future of global production may occur in just a few years, he said. “The U.S. shale boom wasn’t really on the radar a decade ago.”
Several of the differences between BP’s energy outlooks this year and last year emerge from tweaking numbers to account for technological developments in energy production in the U.S., Rühl added.
Globally, natural gas is slated to grow faster than both oil and coal, at 1.9 percent per year, compared to 1.1 percent and 0.8 percent per year, respectively. Conventional natural gas resources in emerging economies will likely push the resource’s growth the fastest, BP said.
Global energy demand is set to grow by 41 percent in 2035 — a less dramatic figure than the world has seen in past decades — as China, India and other emerging economies drive most of the demand, especially for power, Dudley said.
China, the company said, will surpass Europe to become the largest buyer of overseas energy sources in the world by 2035, especially as it doubles its use of natural gas to 12 percent, eating into coal’s dominance in the country. Natural gas production in China could grow more than 200 percent over the next two decades, BP said.
Massive demand for transportation fuels in emerging economies like China will boost worldwide liquids production to 109 million barrels per day. That will also mean 72 percent of the growth in carbon emissions will come from those less developed countries. Overall, carbon emissions will rise by 29 percent across the globe by 2035, according to BP.
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