Oil production by OPEC members is expected to grow to 41 million barrels per day (bpd) in 2010 from under 28 million bpd this year to meet rising global demand, the International Energy Agency (IEA) said yesterday.
Production costs are expected to drift between $8 and $10 per barrel over the next 10 years, said Tatsuo Masuda, director of Oil Markets and Emergency Preparedness at the Paris-based IEA. At those levels, producers would be able to cover their cost of capital and make a rate of return of 15 percent if oil prices were around $14-15 per barrel, he said. World oil prices are now around $30.
Masuda said world oil consumption is expected to average under 77 million bpd in 2000 and rise between 1.7 million bpd to 2.3 million bpd, or over two percent, each year to 86 million bpd in 2005 and 96 million bpd in 2010. At least one million bpd of additional OPEC crude production will be needed each year through 2010 to meet the projected demand growth.
Non-OPEC oil production is forecast to grow from 45.9 million bpd in 2000 to 50.9 million bpd in 2010, boosted by output increases in Russia and other former Soviet Union countries, West Africa and Latin America led by Brazil. “Combining production from non-OPEC countries, with OPEC NGLs (natural gas liquids), leaves a call on OPEC crude projected to grow from just under 28 million bpd this year to 34 million bpd in 2005 and 41 million bpd in 2010,” he said in a paper to be presented at a regional oil and gas conference in the Malaysian capital. “What it needs is sustained capital investment and OPEC needs to start making these investments now,” Masuda said. “At the high end, $110 billion could be needed to maintain existing fields and also to add 10 mb/d over 10 years in the Persian Gulf OPEC countries.” Reuters