Sustainability in the oil and gas industry is, of course, a topic of great interest to leading industry experts, from oil companies to environmental groups and environmentalists.
But these days, the industry is under threat from new technologies that have not yet fully caught up, as well as environmental groups and other advocates who oppose the continued use of fossil fuels.
In this article, we will look at two trends we have identified: rising energy demand and consumption and the ever-increasing cost of energy. Concerns about the future of the oil and gas industry are justified. We rely on these substances to keep our vehicles running, to build and expand our cities, and even to warm our homes.
At the moment, neither is inherently positive or negative, but it clearly shows the direction we are taking as a global industry. What to do with this information remains to be seen, as well as its impact on the long-term sustainability of the oil and gas sector.
If you look at the World Urbanization Prospects study, prepared and conducted by the United Nations in 2011, it is easy to see that the population is growing fast. The study found that the world's population will not stop growing any time soon, and that it will reach 8.9 billion by 2040. This means that it will grow by 0.8% per year over the next 30 years, with an average annual increase of 1.2%. One of the first things we need to watch, and I am sure everyone needs to do that, is that our world will continue to gobble up energy until the world gets going.
Massive population growth like this alone indicates that demand for energy consumption will rise steadily. Good news: It seems that supply is sufficient to meet this demand, but what about the long-term future?
If demand increases, supply must be able to keep up, and if we are not ready, oil and gas prices will rise. One thing that we must all feel very sorry for is the ever-increasing cost of oil extraction.
This means that the driving force of the oil and gas industry is the production of more oil than we already have. So why do we need so much more of it and what does it mean for the future of our economy and our environment?
Without the Middle East's oil reserves, most of the oil that remains untouched is in areas that are polluted to a degree that global industry has regarded as commonplace and has never seen. These include countries such as Canada, Russia and Venezuela, but also areas containing heavy fuel oil, tar pits or oil sands.
Looking at the available data, one can assume what the oil production sites will look like as early as 2040. This forecast will save us some time, but if the costs are passed on too much to the end user, we could see a further decline in demand. Although these two areas of potential complications are certainly something we need to consider before acting too quickly, there are other factors that we all need to think about and these forecasts will be saved in time.
At the moment, the global industry's biggest concerns revolve around two things: supply and demand, and money. If we can maintain the balance, our industry will continue to flourish, but if we do not look carefully to the future, we should expect to bleed to death and see the industry collapse.