According to Oil & Gas Journal’s annual assessment, the world’s proved oil reserves total 1.73 trillion bbl at yearend 2020, 2.6% higher than a year earlier. The increase was totally driven by higher oil reserves reported by the Organization of the Petroleum Exporting Countries (OPEC), in particular a dramatic growth in Iran’s oil reserves.
Worldwide proved natural gas reserves are now estimated to be 7.28 quadrillion cf (quads), up from 7.27 quads in the previous year’s survey. The increase reflects OGJ’s upward adjustments to Azerbaijan and Turkmenistan’s gas reserves.
The published reserves figures rely on survey responses and official updates released by individual countries, which are not provided every year in many cases. OGJ changes its estimate for a country only when it receives evidence that a change is in order. Therefore, in a given reserves summary, a year-to-year change—or lack thereof—may not necessarily reflect a change that applies to the calendar year alone.
OGJ’s figures for oil reserves and production increasingly include natural gas liquids. Some countries’ gas reserves refer to dry gas reserves after moving NGL reserves explicitly into oil reserves.
When the original oil data are reported in metric tons, OGJ converted the data to volume unit b/d by applying conversion factors suggested by the International Energy Agency for each country.
Oil prices were extremely volatile in early 2020 due to the impacts of the COVID-19 pandemic. To balance the market, OPEC and other oil producing countries including Russia (OPEC+) provided the largest production cut on record. Other producers around the world, especially the US and Canada, had also quickly slashed production and investments in response to the oil demand collapse caused by COVID-19.
OGJ forecasts global oil production in 2020 to average 88.66 million b/d vs. a 2019 average of 93.73 million b/d. Total non-OPEC supply is set to drop by 2 million b/d in 2020.
Reserves changes
Total proved oil reserves in the Asia-Pacific region decreased to 46 billion bbl in this year’s report from 46.68 billion bbl in the previous survey. Gas reserves dropped to 590.15 tcf from 623.6 tcf a year ago.
According to the 2020 China Mineral Resources Report (CMR), China’s proved remaining oil reserves at yearend 2019 total 3.55 billion tons, a 0.5% decrease from 3.57 billion tons at yearend 2018. China’s remaining reserves for conventional natural gas were 5.97 trillion cu m, a 3% growth from the year-ago level. Shale gas reserves increased dramatically by 77.8% to 384.08 billion cu m, thanks to strong exploration efforts and investments.
According to the latest report from the Directorate General of Oil and Gas, Indonesia’s proven oil reserves as of Jan.1 2019 totals 2.48 billion bbl, down from 3.15 billion bbl a year ago. Its proven gas reserves declined to 49.74 tcf compared to 96 tcf a year ago. The dramatic fall from the previous year’s figures is due to new parameters of the 2018 Petroleum Resources Management System. A portion of undeveloped gas reserves has been categorized as contingent resources since 2019.
According to the Ministry of Petroleum and natural gas, India’s crude oil reserves increased to 618.94 million tons as of April 2019, compared to 594.49 million tons as of April 2018. Gas reserves increased to 1.38 trillion cu m.
Australia’s reserves estimates were made at yearend 2015, and no updates have been made after that, according to Geoscience Australia.
Pakistan’s oil and gas reserves, according to the survey response, increased significantly in 2019 due to an upward adjustment in the fields of Tal Block and Adhi fields.
Oil and gas reserves both declined in the Western Europe region, by 2.2% and 7%, respectively.
Data from the Norwegian Petroleum Directorate (NPD) shows that, at yearend 2019, Norway’s oil reserves, which include crude oil, condensate and NGLs, amounted to 8.12 billion bbl, compared to 8.22 billion bbl a year ago. Norway’s gas reserves at yearend 2019 declined to 54.5 tcf from 57.3 tcf at yearend 2018. The method NPD uses for classification of reserves is the United Nations Framework Classification System (UNFC).
According to the latest estimates from the UK Oil & Gas Authority, UK’s proved oil reserves at yearend 2019 decreased by 200 million bbl to 2.5 billion bbl. Proven gas reserves were little changed.
According to the Geological Survey of the Netherlands, the country’s estimated natural gas reserves as of Jan. 1, 2020, decreased to 4.68 tcf from 6.92 tcf recorded as of early 2019, reflecting the strong write-down of the reserves in Groningen field. The country’s oil reserves as of Jan. 1, 2020, amounted to 137.74 million bbl, up from 114.47 million bbl a year ago.
Canadian conventional crude and condensate reserves are now estimated at 5.7 billion bbl, up from 4.36 billion bbl recorded a year ago, according to the latest evaluations by the Canadian Association of Petroleum Producers (CAPP). The latest estimate of Canadian oil sands reserves decreased to 162.5 billion bbl from 163.5 billion bbl a year ago. Canadian natural gas reserves increased to 73 tcf from 71.26 tcf a year ago.
According to Pemex’s hydrocarbon annual evaluations, as of Jan. 1, 2019, Mexico’s estimated proved reserves of oil totaled 5.78 billion bbl, down from 6.43 billion bbl as of Jan.1 2018. The current oil reserves consisted of 5.33 billion bbl of crude, 62.4 million bbl of condensate, and 390.8 million bbl of NGL. Mexico’s proved dry gas reserves total 6.4 tcf, down from 6.6 tcf a year ago. Associated gas represents 59.9% of the total. Pemex has yet to update its hydrocarbon annual evaluations as of Jan. 1, 2020.
The latest estimates of Brazilian National Petroleum Agency (ANP) show that crude oil reserves in Brazil decreased to 12.71 billion bbl in 2019 from 13.43 billion bbl in 2018, while its gas reserves declined consecutively to an estimated 12.85 tcf from 13.03 tcf a year ago.
According to the Argentinian Institute of Oil & Gas (IAPG), Argentina’s proved crude oil reserves at yearend 2019 totaled 2.48 billion bbl, a 4% increase from a year ago. Its proved gas reserves increased to 14 tcf from 13.12 tcf in the previous evaluation.
Colombia’s crude oil reserves increased to 2.04 billion bbl at yearend 2019. Gas reserves decreased consecutively to 3.1 tcf from 3.78 tcf a year ago, according to the Energy Ministry of the country.
Following a series of discoveries, ExxonMobil has increased its estimated recoverable resource base in Guyana to more than 8 billion oil-equivalent bbl. However, there is still a lack of concrete figures for Guyana’s oil and gas reserves.
Bahrain gas reserves were revised down due to the annual reclassification of reserves, according to the country’s national oil and gas authority.
OPEC reserves
The reserve figures reported for OPEC members are referenced from the organization’s latest annual statistical bulletin.
Total proved crude oil reserves for the current OPEC group increased 3.8% from a year ago to 1.23 trillion bbl and total natural gas reserves move up slightly by 0.66% to 2.59 quads.
Saudi Arabia’s crude oil reserves decreased to 258.6 billion bbl from 267 billion bbl a year ago.
Meanwhile, crude oil reserves reported by Iran increased to 208.6 billion bbl from 155.6 billion bbl a year ago, thanks to the Namavaran crude oil discovery. The 53 billion-bbl crude oil discovery is the second-largest known oil deposit in the country, according to a senior government minister.
OPEC’s current oil reserves account for 72% of the worldwide total and gas reserves account for 36% of the world’s gas reserves.
US reserves
Proved reserves of crude oil in the US increased 12% to 43.8 billion bbl at yearend 2018, compared to 39.2 billion bbl at yearend 2017, setting another US record for crude oil proved reserves. This is according to the 2019 reserves report from the US Energy Information Administration (EIA).
Proved reserves of lease condensate increased 14%, to 3.2 billion bbl at yearend 2018 from 2.8 billion bbl at yearend 2017.
US crude oil and lease condensate proved reserves at yearend 2018 stood at 47.1 billion bbl, a 12% increase over yearend 2017.
Proved reserves rose 12%, or 4.1 billion bbl, onshore in the Lower 48 states, and rose 20% in Alaska and 10% in the Federal Offshore (both Pacific and the Gulf of Mexico).
Texas saw the largest net increase in crude oil and lease condensate proved reserves of all states in 2018, an increase of 13% (+2.3 billion bbl) from 2017. In 2018, the largest proved reserves gain was in the Permian basin of West Texas (Texas Railroad Commission District 8) where operators developed the Wolfcamp/Bone Spring shale play within the Delaware basin and the Spraberry Trend Area of the Midland basin.
The second largest net increase in crude oil and lease condensate proved reserves was in New Mexico, an increase of 28% (+750 million bbl) from 2017. In eastern New Mexico (portions of which are within the Permian basin) operators developed the Wolfcamp/Bone Spring shale play.
US proved reserves of total natural gas (including natural gas plant liquids) increased by 40.2 tcf, or 9%, to 504.5 tcf at yearend 2018. Operators in Texas, Pennsylvania, and New Mexico reported the largest net increases in natural gas proved reserves in the US in 2018.
The estimated volume of natural gas plant liquids contained in proved reserves of total natural gas increased to 21.8 billion bbl in 2018 from 19.2 billion bbl in 2017, a 13.5% decrease.
Accordingly, US dry natural gas proved reserves increased to 474.8 tcf at yearend 2018 from an estimated 438.5 tcf in 2017, an increase of 8.3%.
EIA is scheduled this December to update the yearend 2019 estimates of proved reserves. As the updated figures were not yet available as OGJ went to press, estimates are based on reserves information revealed by the OGJ150 group.
OGJ forecasts that, as of yearend 2018, US proved oil reserves, including crude oil, lease condensate, and NGL reserves, totaled 69.4 billion bbl, up 2.8% from the prior year. Dry natural gas reserves decreased 3.6% to 457 tcf. OGJ will update yearend 2019 US reserves to EIA’s figures in next year’s report.
World oil production
After record OPEC+ cuts and massive economically driven shut-ins, global oil production in 2020 is expected to fall 5.4% to an average 88.65 million b/d vs. an estimated 2019 average of 93.73 million b/d.
Total OPEC oil supply this year is estimated to average 31.34 million b/d, compared to 34.43 million b/d last year, with Saudi Arabia making the largest reductions in production. Venezuela’s oil supply is estimated to decline 34% to around 610,000 b/d in 2020 from 920,000 b/d in 2019, squeezed by US sanctions.
Russia’s oil production is expected to average 10.65 million b/d this year, down from the year-ago level of 11.58 million b/d. Both parts of the OPEC+ production cut deal, Kazakhstan and Azerbaijan oil outputs are estimated to decline 5.4% and 8.3% in 2020, respectively.
In the US, crude oil production is forecast to decline to 11.3 million b/d this year from 12.25 million b/d last year. US NGL production is expected to increase to 5.1 million b/d from 4.82 million b/d last year. Total US oil supply is projected to decline to 16.4 million b/d this year from 17.07 million b/d in 2019.
Canadian oil supply is expected to decrease 4% this year to 5.15 million b/d from 5.37 million b/d in 2019, reflecting shut-ins and steep cuts in capital expenditure plans.
Mexico’s oil supply is set to increase marginally in 2020, largely thanks to extraordinarily high production early this year before the pandemic impact.
Brazilian oil production is expected to increase 7.4% to 3.1 million b/d in 2020 from 2.89 million b/d in 2019, thanks to strong investment and boosted production from the presalt horizon. Elsewhere in Latin America, oil production is below year-ago levels.
Despite voluntary curtailments, Norwegian oil output is expected to expand by 16% to 2.02 million b/d this year, thanks Johan Sverdrup field startup. UK’s oil output is set to drop by 1.9% this year to 1 million b/d, following recent disappointing production data.
Oil production in the Asia-Pacific region is expected to decrease to 7.2 million b/d in 2020 from 7.33 million b/d in 2019. Oil production in China for 2020 will increase 2% to 3.9 million b/d. Australia’s production also will increase marginally this year. However, output from all other Asia-Pacific producers will decline (Malaysia and Brunei, both part of the OPEC + deal, cut production) and gains in China and Australia will fail to offset the decline elsewhere.
