Energy Perspectives 2016 Long-term macro and market outlook Press - - PowerPoint PPT Presentation

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Energy Perspectives 2016 Long-term macro and market outlook Press seminar, Oslo, 9 June 2016 Eirik Wrness, Senior vice president and Chief economist Energy Perspectives 2016 Macro and market outlook to 2040

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Energy Perspectives 2016 Long-term macro and market outlook

Press seminar, Oslo, 9 June 2016 Eirik Wærness, Senior vice president and Chief economist

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Macro and market outlook to 2040 – www.statoil.com/energyperspectives

Energy Perspectives 2016

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Significant uncertainty and large changes

… this calls for using scenarios

Supply and demand factors

(indexed 2002=100)

Source: The Economist Source: DOE, CEIC, IEA, IRENA

2000 4000 6000 8000 10000 12000 200 400 600 800 1000 1200 1400 1600 2000 2003 2006 2009 2012 2015 US shale oil prod. Chinese int. tourists New Chinese cars Chinese air passengers Solar capacity (rhs)

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Several futures are possible...

2015-04-28 4 Classification: Internal

But the world is twice as rich, needs more energy, and is more efficient

World GDP growth rates

% 1 2 3 4 '90-'00'00-'10 '10-'20 '20-'30 '30-'40 H Reform Renewal Rivalry 100 200 300 400 500 1990 2000 2010 2020 2030 2040 Reform Renewal Rivalry

World GDP and energy demand

Index, 1990=100 2013

Renewal Reform Rivalry

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Source: BigThink, IEA, Statoil (projections)

A strong trend affecting economics and energy

All growth in energy demand in emerging economies, in particular in Asia

World energy demand per region

Bn toe 4 8 12 16 20 Ref Ren Riv Ref Ren Riv Rest of world India China OECD Pacific OECD Europe OECD Americas 2020 2040 2013

The global population centre is in Asia

Each small square represents 1 million people

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Speeding up the change in global energy mix

… with Renewal displaying a paradigm shift

0% 20% 40% 60% 80% 100% 1973 1983 1993 2003 2013 2040 Reform 2040 Renewal 2040 Rivalry New RES Biofuels and waste Hydro Nuclear Gas Oil Solid fuels 5 10 15 20 1973 1983 1993 2003 2013 2040 Reform 2040 Renewal 2040 Rivalry Historical Bn toe

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CO2 emissions determined by demand and mix

7 Source: IEA (history), Statoil (projections)

Climate policies: Driving Renewal, contributing to Reform

Reform 450 Renewal NP Rivalry 10 20 30 40 Statoil IEA 2040 2013

World CO2 emissions

Billion tons

World CO2 emissions

Billion tons 10 20 30 40 Ref Ren Riv Rest of world India China OECD Pacific OECD Europe OECD Americas 2040 2013

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Technology shift for light duty vehicles

Light Duty Vehicle fleet composition Billions

Source: IEA (history), Statoil (projections)

Sales Light Duty Vehicles Millions

… in all scenarios, and a revolution in Renewal

Fuel mix in Final Energy Demand for LDVs %

20 40 60 80 100 Ref Ren Riv

Electricity Biomass Gas Oil

2013 2040 20 40 60 80 100 120 140 Ref Ren Riv

Other Plug-in hybrids Electric vehicles Diesel Gasoline

2040 2013 1 2 3 Ref Ren Riv

Other Plug-in hybrids Electric vehicles Diesel Gasoline

2040 2013

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Fuel mix change in electricity

Large investments in new renewables required, especially in Renewal

Solar and wind generation capacity

GW 1,000 2,000 3,000 4,000 5,000 6,000 7,000 Ref Ren Riv Solar Wind 2040 2013

Electricity generation mix

% 20 40 60 80 100 Ref Ren Riv Geothermal Solar Wind Biomass Hydro Nuclear Gas Oil Coal 2040 2013

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Oil and gas dominate in other sectors

… contributing to maintaining demand for fossil fuels

Fuel mix in Final Energy Demand for Residential, Commercial & Industrial sectors

Fuel mix in Final Energy Demand for Transport excluding LDVs

% 20 40 60 80 100 Ref Ren Riv Electricity Biomass Gas Oil Coal 2013 2040 20 40 60 80 100 Ref Ren Riv

Heat Electricity New RES Biomass Gas Oil Coal

2013 2040

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Source: IEA (WEO 2015), Statoil (projections)

Oil and gas are here to stay…

… for decades

Oil demand*, and supply from existing fields

Million barrels per day

Gas demand, and supply from existing fields

Billion cubic meters

Assumming production from existing fields declining at 3-6% p.a.

Demand range Decline range Production 20 40 60 80 100 120 140 2015 2020 2030 2040 Demand range Decline range Production 1000 2000 3000 4000 5000 2015 2020 2030 2040

Assumming production from existing fields declining at 3-6% p.a.

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… which requires significant investments…

12 Source: IEA (history), Statoil (projections)

New oil production in 2040

Billion toe

1 2 3 4 5 Ref Ren Riv Reform Renewal Rivalry

…in addition to investments in new renewables and electricity systems

1 2 3 4 5 Ref Ren Riv Reform Renewal Rivalry 1 2 3 4 5 Ref Ren Riv Reform Renewal Rivalry New gas production in 2040

Billion toe

Incremental RES production 2015-40

Billion toe

56 mbd 2700 bcm 12 500 TWh

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