The Availability of European Oil and Gas Resources

Abstract

PURPOSE: This study constructs supply cost curves for conventional and unconventional oil and gas to assess the availability of indigenous resources in the region.DESIGN/METHODOLOGY/APPROACH: Estimated volumes are distributed across resource quality categories that are based on production costs. The resulting supply figures are intended to be long-term representations of how quantities vary with production costs. Both economic and physical measures are used since each provides practical information with respect to the concerns some energy commentators have expressed about oil and gas scarcity in the near future. Supply cost curves incorporating the effect of annual technological advancement on production costs to the year 2030 are also estimated. On the quantity side, the curves include volumes from geological provinces not previously assessed.FINDINGS: Results indicate that conventional and unconventional oil and gas resources in Europe are abundant and can be produced at costs below current and projected market prices.PRACTICAL IMPLICATIONS: In spite of the findings, future development may continue to face regulatory, investment, and market challenges.ORIGINALITY/VALUE: With oil and gas providing approximately two-thirds of primary energy consumption in Europe, energy security remains a concern due to high import dependency. This study could be used to examine the possibility of developing indigenous oil and gas in order to alleviate the problem.