Three Reasons Oil Will Continue to Run the World

What if oil disappeared tomorrow?

Mineral oil is an energy-intensive and versatile liquid which humans have been exploiting on a large scale since the 1850s. After 170 years, many are calling for its production to cease completely. The question is what would happen then.

Ill. Egil Bjørøen

Some people predict that phasing out oil rapidly might create a doomsday scenario. Others believe it would usher in idyllic conditions.

Norwegians may think they could adapt to such new circumstances, given electric cars, wind turbines and so forth. But would they manage without imported food?

Numerous other things which might have to be foregone include air travel, cosmetics, contact lenses, trainers, sportswear and shampoo – not to mention key medicines and hypodermic syringes.

Hydrocarbons are extremely energy-intensive. One barrel of crude oil, or 159 litres, equals 1 300 kilowatt-hours – enough to meet the energy needs of a Norwegian detached house for a month.

A litre of petrol contains roughly 9.1kWh – sufficient to heat eight full buckets or 80 litres of water from room temperature at about 23°C to boiling point.

Rests

Modern society rest on oil, emphasises chief economist Eirik Wærness at oil company Equinor: "Our entire prosperity, economic progress and economic system, and the whole communication system which allows us to visit each other in a completely different way than we did before, for example, are based on an economy with access to very efficient energy sources."

He lists these in order of importance as coal, then oil and finally gas and notes that all three are currently used simultaneously.

"If oil disappeared tomorrow, that's what would go – a society completely different from what it was in 1850 when we seriously began to exploit hydrocarbons. We've got so used to this that we don't even think about it."

The Norwegian Oil and Gas Association has calculated that shutting down Norway's petroleum industry from 2020 would mean the loss of NOK 140 billion in annual government revenues.

It also estimates that around 300 000 people employed in the country directly and indirectly by the industry would lose their jobs.

Transport

"If oil disappeared tomorrow, it would have global consequences for transport," says Kjell Werner Johansen, deputy head of the Norwegian Institute of Transport Economics (TØI).

He points out that this sector is crucial for trading goods and services, and that no distribution network not dependent on the internal combustion engine exists.

"We've got electric trains, of course, but rail freight depends on motor vehicles at each end of the track. Without oil, aviation, shipping and road haulage would cease. Global trade would face major difficulties as a result."

Ill. Egil Bjørøen

Food

The sudden absence of oil is also certain to present big problems for food production, Johansen adds. "The raw material position would become critical."

He points to halted farm tractors and other equipment, while fishing boats could not put out to sea without fuel for their diesel engines.

Even more seriously, perhaps, artificial fertiliser production would run into difficulties, given that this depends on hydrogen from natural gas reacting with nitrogen.

"The gas used for this purpose could undoubtedly be replaced by something else, but not overnight," Wærness observes.

Cars

If oil goes, it might be comforting to think that Norway has so many electric cars. Although we are world leaders in this area, however, Johansen reveals that less than seven per cent of the country's passenger cars are electrically powered.

Moreover, over 99 per cent of utility vehicles such as lorries and buses run on diesel or petrol. These will come to a halt as service stations run out of fuel.

You might think the answer is simply to buy more electric cars – but these contain many oil-based products and need to be freighted with the aid of petroleum.

The car industry is also a global industry. Fossil fuels are needed to transport the components used in vehicles to the actual manufacturing site.

"These parts come from every continent through product channels which would face problems," says Johansen. "Nor do the manufacturers have the capacity to convert to making electric cars alone – at least not in the short term."

Products

The flow of products to shops would stop without oil, and Johansen predicts that the shelves would quickly empty. Working life would largely cease because people could not get to and from jobs.

"Service provision would stop," he forecasts. "That's bad enough, but the consequences of halting the flow of goods are much more dramatic.

"It'll take time to adapt if we're going to start cultivating carrots in flower pots or keeping pigs and chickens in the back garden."

Agriculture could continue on a smaller scale, following the old ways and with a more seasonally based, local range of foodstuffs.

Converting to living without oil for maintaining basic everyday life would require at least 10-20 years, Johansen estimates.

He notes that even the scenarios related to the 1.5°C goal from the UN's intergovernmental panel on climate change assume substantial oil and gas consumption up to and beyond 2050.

Ill. Egil Bjørøen

Alternatives

Without oil, we would face a world as far outside our ordinary experience as it is possible to get, observes Johansen, and sees no adequate alternatives to fossil fuels.

Eliminating air, sea and long-distance road freight means that goods could be neither bought nor sold on any scale. Short-range transport, which might use electricity, could suffer bottlenecks.

He points out that local transport distributes the food, medicines and other products we need to keep us fit and healthy.

Biofuel

In an oil-free future, Norway would have some capacity for biofuel production. Chemicals group Borregaard, for example, produces 20 million litres of bioethanol per annum.

According to its communication adviser, Tone Horvei Bredal, that entire output is used today for blending with conventional petrol.

This could be used in theory directly for fuel, but the amount involved is small compared with petrol and diesel oil production. The choice would probably lie between using it for fire engines or for food lorries, rather than for private motoring.

Norwegian biofuel output is very limited, and international demand would rise enormously in such circumstances. A rapid conversion to producing biofuels would be difficult and again require the use of fossil sources.

"You've got to go out into the woods and harvest what you're going to make biofuel from – algae, seaweed or timber," observes Johansen.

"It then needs to be transported and processed, and none of this can be done with electric vehicles running on hydropower or battery-driven power saws."

Plastics

One of the most important substances derived from oil – plastics – would be impossible to produce on today's scale if petroleum output were to cease abruptly.

The petrochemical industry absorbs about four per cent of global oil and gas output. Norway manufactures some 800 000 tonnes of plastics annually, primarily using American ethane.

In our daily lives, it is almost easier to think of what does not contain plastics – which takes a variety of forms used in countless different products.
Polyethylene (PE), for example, is utilised to make packaging, building and agricultural film, shrink film, paper and cardboard coatings, carrier bags, sacks and hoses.

In addition come piping, bottles, canisters, buckets, electrical insulation, household items and technical articles, certain pleasure boats, foam plastics, toys and much more.

This material is also found in a form known as ultrahigh molecular weight PE, so wear-resistant that it can be used as a biomaterial for artificial human joints.

It is also utilised to produce new fibre grades with unusually high strengths and soles for the skis worn by many Norwegians.

High proportions of oil-based plastics are also used in furniture, building materials, paint, computers, mobile phones and cars.

Sports equipment is another application, along with clothes, carpets and all possible other types of textiles such as curtains. Think of all the ropes containing nylon, which derives from oil.

Look around the room you are sitting in, and think how many things there contain plastics. The answer is almost everything. This material has revolutionised our daily lives.

And many of the innovations which make cars and aircraft lighter and more fuel-efficient today are produced from plastics.

Biomass

If petroleum vanished, it is reassuring to know that "everything which can be made with oil can be produced from trees", as the Research Council of Norway has claimed in a newspaper article.

Carried by leading daily Aftenposten, this covered producing plastic from biomass. Borregaard converts roughly a million cubic metres of timber every year into a variety of substances.

Norway's forests grow at a gross rate of 25 million cubic metres per annum, with 10 million being felled. So annual carbon-neutral output could be boosted by 15 million cubic metres.

But it would take a long time to scale up production of bioethanol, for example, or the raw materials for making cement, paint and cosmetics and other products.

That is still a long way short of what the oil industry provides. And it would be impossible without diesel to fuel lorries for freighting the timber.

Plastics produced from wood are often just as little degradable as those from oil. Only a tiny proportion of plastics based on biomass degrade quickly in nature.

Heating

The disappearance of oil would cost part of Europe's electricity output. Much is said about gas in relation to power generation, but that only consumes about 30 per cent of the Norwegian gas exported to the continent.

No less than 40 per cent is utilised directly for cooking and domestic space heating in the UK and other European countries, according to Norwegian Oil and Gas.

"One of the most important consequences of a sudden halt to petroleum production is that most Europeans would be unable to cook or heat their homes," says Hildegunn Blindheim, the association's director for climate and the environment.

The remaining 30 per cent share of Norway's gas exports is used for industrial purposes – achieving extreme production temperatures, for example, or direct conversion to fertiliser.

In the case of oil, about 10-15 per cent of Norwegian production is used to manufacture various products, and Blindheim says this share is rising. Norwegian Oil and Gas expects it to double to about 25-30 per cent by 2050.

Ill. Egil Bjørøen

Energy

A sudden loss of oil supplies would make it impossible to meet world energy needs. Countries have very vary­ing stocks of natural gas which they could tap, and Johansen says such resources would be quickly depleted. "We're talking about weeks."

Many industrial sectors depend on oil and gas, and competition will be intense over what remains after production has ceased. Coal could become resurgent in such areas as power generation.

"Power generation from renewable sources is growing faster than we can manage to predict," says Blindheim. "But energy demand is increasing at the same time.

"The rise in consumption was covered by renewables for the first time only in 2018, but 80 per cent of demand is still met from fossil fuels."

If oil vanished tomorrow, renewables would have to meet that four-fifths as well as any further growth. That is not possible in the short term, Blindheim affirms – regardless of whether solar cells and wind power get cheaper.
"We'll remain dependent on petroleum for several decades – rather less on oil than on gas," she says. "Technological advances which reduce greenhouse gas (GHG) emissions from these fuels is therefore essential if we're to meet the climate goal."

Sensible

According to the experts, it would be sensible – if oil did not vanish overnight but was phased out slowly – to reduce Norwegian emissions from both industry and power generation.

One approach could be carbon capture and storage (CCS), where a number of trials are currently under way. Another is to use hydrogen produced from natural gas or via electrolysis as an energy bearer.

The oil industry has a clear role to play in both these areas. Preliminary work is being done on two full-scale CCS plants, and a CO2 store on the NCS will be completed this autumn.

Few people believe demand for petroleum will fall drastically in the near future. So efforts to cut emissions from air, sea and heavy road transport could be positive, since oil replacements are particularly hard to find in these areas.

"To reach the climate goals, the whole toolbox of measures must be used," says Blindheim, and notes that oil industry expertise can contribute to finding solutions.

Shell and Total as well as Equinor are working on solutions for carbon storage and transport, while the latter is also pursuing opportunities to convert natural gas to hydrogen.

Combining this with CCS would allow the resulting product to be used as clean energy in such applications as fuelling large ships, which have no way to cut GHG emissions sufficiently today.

Drawback

One drawback with generating electricity from renewables is that output varies with the amount of sunshine or wind – not only during a day but also over weeks.

Energy consumption can also fluctuate greatly between summer and winter, for example – as is the case in the UK, where gas is widely used for space heating at present.

Seeking to overcome this challenge by building infrastructure which ensures that enough renewable power is available at all times would call for huge investment.

Natural gas has been highlighted as a means of smoothing out these supply fluctuations. Equinor and some partners are pursuing a Dutch project to see whether hydrogen could be part of the solution for a power station.
If such a facility can use this as a fuel, rather than natural gas, it could serve as a massive battery for electricity output when the wind does not blow or the sun shine.

Conventional batteries in themselves cannot operate much beyond hour by hour – in other words, levelling out daily variations.

Since splitting hydrogen is an energy-intensive business, this could be done with surplus solar or wind power, storing the result and turning it back into energy when renewables are unavailable.

But Blindheim says that this approach would not supply enough hydrogen. Britain, Germany and the Netherlands have specific projects under way to identify how the gas could be produced in combination with renewables and thereby reduce GHG emissions.

The fertiliser industry already uses natural gas to produce hydrogen, but has so far been unable to store the resulting CO2 instead of emitting it.

"That's where the companies on the NCS come in, with trials of storing captured CO2 beneath the seabed," explains Blindheim. "Both Norway and other countries have mapped possible sites."

She notes that the EU mentions hydrogen in its long-term Clean Planet vision published last November, where particular attention has been given to CCS from industrial processes.

This is because emissions from these operations cannot be overcome through greater use of electricity. Processing limestone to produce cement, for example, releases CO2 regardless.

The EU also sees that hydrogen will be important for reaching climate targets, but has yet to produce any specific plans for a commitment here.

Ill. Egil Bjørøen

Quick cuts

"We're fully aware that quick cuts in GHG emissions are needed if we're going to reach the climate goals," says Wærness, but believes economic growth and development must also be secured.

Hydrocarbons have to be delivered as energy-efficiently as possible, he emphasises, with the lowest possible emissions during actual production. Oil and gas must be used with maximum efficiency and minimum waste.
He therefore points to the need for more effective internal combustion engines and extremely rapid electrification in parts of the transport sector – much faster than today's pace.

Electric cars and buses must be adopted and electric lorries used for local deliveries. Some increase is likely in replacing petrol with biofuels, and diesel with natural or bio gas.

"Demand for oil must be reduced, while gas consumption is likely to remain at today's level rather longer but will eventually also decline," Wærness believes.

When that happens, he thinks Norway will also get more CCS. That would create greater space for natural gas – particularly in the energy sector.

"We often forget that, even if oil consumption declines, investment is needed to meet residual demand. Supply would otherwise fall much faster as reservoir pressure drops.

"As a result, our view is that Norway and Equinor will continue to be involved with oil and gas for many decades to come even if we move towards the climate goals."

At the same time, Wærness hopes the company can play its part in achieving the low-carbon share of the energy mix – in other words, CCS, hydrogen and eventually new renewable power.

But it needs time to do this slowly. "Many people forget that the costs are high, and that it's demanding to make new renewable energy profitable."

Planned

A planned and controlled transition from a society dependent on fossil fuels to a more sustainable existence is very important, says Johan Einar Hustad.

He is director of NTNU Energy, one of the four thematic research priorities at the Norwegian University of Science and Technology in Trondheim.

In his view, progress must be made through international deals similar to those pursued for about 30 years under UN auspices, from the Kyoto protocol to the Paris agreement.

Collaboration is needed between nations, within countries and in industry, Hustad says, and notes that consumption patterns must change if renewables are to develop into real alternatives.

"These options can only be secured by using the time available to come up with the necessary incentives and investments, even though everyone agrees that this is an urgent matter."

He points out that consumers must be given choices like those they now possess when buying cars or making daily food purchases. "It's important that they become more aware.

"On the other hand, we're dependent on what the government does to promote alternatives through incentives. That's the only way to ensure profitability for the first people to initiate renewable activity, as we've seen in electricity generation."

Hustad notes that it is only 10 years since solar and wind power really got going. The price of such supplies has only recently reached a competitive level.

He is also a supporter of CCS, and agrees with Blindheim that Norway has a good basis for becoming well qualified in this area, thanks to its oil-industry experience.

Hurry up

"We must do a lot more than today, and need to hurry up," Hustad emphasises. "We've got to reorient investment toward renewables. Shutting down the oil sector would worsen the whole position.

"That would destroy everything. Without a gradual and controlled approach, we'll find ourselves returning to the pre-oil age or perhaps heading even further back."

Nevertheless, he believes it is important to listen to the young people who are calling for oil production to be terminated at once.

"These voices are needed in order to shift policy in a more sustainable direction," he argues. "If nobody speaks out, nothing happens.

"We must stop finding excuses for not finding alternatives. But if we move too fast, we also destroy the opportunities which exist for creating sustainable replacements."

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Source: https://www.npd.no/en/facts/publications/norwegian-continental-shelf/norwegian-continental-shelf-no1-2020/what-if-oil-disappeared-tomorrow/

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