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EIA: AEO 2013 reference case projects faster US production growth

Advanced technologies will increase US oil production more quickly than previously forecast, the US Energy Information Administration said as it released its 2013 Annual Energy Outlook reference case. Production will rise more quickly than demand as more stringent motor vehicle efficiency standards take effect, it indicated.

“EIA's updated reference case shows how evolving consumer preferences, improved technology, and economic changes are pushing the nation toward more domestic energy production, greater vehicle efficiency, greater use of clean energy, and reduced energy imports,” said Adam Sieminski, EIA administrator.

The reference case is the earliest release of EIA’s annual projections and provides only a baseline for scenarios that will be developed for the final AEO, to be released next spring, Sieminski said. It also marked the first time that IEA has projected estimates to 2040 and used a Brent crude reference price, he added.

The latest estimates placed US oil production, which averaged 5.67 million b/d in 2011, at 6.79 million b/d in 2025, up from the 6.4 million b/d estimate in the 2012 AEO, and 6.26 million b/d in 2035, up from the 2012 AEO’s 5.99 million b/d. Net imports, meanwhile, are expected to fall from 8.67 million b/d in 2011 to 7.08 million b/d in 2025, lower than the 2012 AEO’s 7.14 million b/d, and 7.06 million b/d in 2035, less than the 2012 AEO’s 7.25 million b/d.

US oil import dependence could fall to 37% by 2035, Sieminski said during a briefing on the reference case at Johns Hopkins University’s School for Advanced International Studies. “It could be smaller,” he suggested. “If there’s greater vehicle fuel efficiency, production would continue to rise instead of peaking around 2020.”

The US natural gas production reference case (combining dry gas production and supplemental gas) showed an increase from 23.06 tcf in 2011 to 28.65 tcf in 2025, up from 26.34 tcf in the 2012 AEO, and 31.41 tcf in 2035, higher than the 27.99 estimate in 2012’s AEO. The 2013 reference case projected a transition from 1.95 tcf of net gas imports in 2011 to 1.58 tcf of exports in 2025 (more than the estimated 790 bcf in the 2012 reference case) and 2.55 tcf of exports in 2035 (more than the 2012 reference case’s 1.36 tcf).

Sieminski said continued low US gas prices could help it penetrate new markets, including transportation (particularly LNG in long-haul, heavy-duty vehicles), although the heaviest demand growth will continue to come from industries and electric power generators.

Contact Nick Snow at nicks@pennwell.com.


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