BP Energy Outlook 2017 Presentation Slides

BP Energy Outlook
2017 edition
Bob Dudley
Group chief executive
bp.com/energyoutlook
#BPstats
VCMStudy.ir
BP Energy Outlook
2017 edition
Spencer Dale
Group chief economist
#BPstats
VCMStudy.ir
Economic backdrop
Contributions to GDP growth by factor Contributions to GDP growth by region
% per annum % per annum

5% 5%
Productivity OECD China
Population India Africa
4% 4% Other
3% 3%
2% 2%
1% 1%
0% 0%
1975-1995 1995-2015 2015-2035 1975-1995 1995-2015 2015-2035
2017 Energy Outlook

VCMStudy.ir 3 © BP p.l.c. 2017
Global energy demand
Energy consumption by region Growth in GDP and primary energy
Billion toe % per annum

18 6% Energy intensity
Other
Thousands
16 5% GDP
Africa
Primary energy
14 Other non-OECD Asia 4%
India
12 3%
China
10 OECD 2%
8 1%
6 0%
4 -1%
2 -2%
0 -3%
1965 1975 1985 1995 2005 2015 2025 2035 1965- 1975- 1985- 1995- 2005- 2015- 2025-
1975 1985 1995 2005 2015 2025 2035
2017 Energy Outlook
Fuel mix
Primary energy consumption by fuel Shares of primary energy
Billion toe
18 50%
Renewables*
16 Hydro Oil
14 Nuclear 40%
Coal
12
Gas Coal
30%
10 Oil
8 Gas
20%
6
4 Renewables*
10% Hydro
2
Nuclear
0 0%
1965 1975 1985 1995 2005 2015 2025 2035 1965 1975 1985 1995 2005 2015 2025 2035
*Renewables includes wind, solar, geothermal, biomass, and biofuels
2017 Energy Outlook 5
VCMStudy.ir © BP p.l.c. 2017
China’s declining dependency on coal
Coal consumption growth by region Shares of primary energy in China
Billion toe
1.5 80%
OECD
Thousands
Other non-OECD Asia 70%

India Coal
1.0 China 60%
Other
Total 50%
0.5 40%
30% Non-fossil
0.0 20% Oil
10%
Gas
-0.5 0%
1965- 1975- 1985- 1995- 2005- 2015- 2025- 1975 1985 1995 2005 2015 2025 2035
1975 1985 1995 2005 2015 2025 2035
Fuel mix
Primary energy consumption by fuel Shares of primary energy
Billion toe
18 50%
Renewables*
16 Hydro Oil
14 Nuclear 40%
Coal
12
Gas Coal
30%
10 Oil
8 Gas
20%
6
4 Renewables*
10% Hydro
2
Nuclear
0 0%
1965 1975 1985 1995 2005 2015 2025 2035 1965 1975 1985 1995 2005 2015 2025 2035
*Renewables includes wind, solar, geothermal, biomass, and biofuels
2017 Energy Outlook 7 VCMStudy.ir © BP p.l.c. 2017
Renewables
Renewables as a share of power Shares of renewable power growth
generation
40% 40%
EU
US
30% World 30%
China 1995-2015
2015-2035
20% 20%
10% 10%
0% 0%
1995 2005 2015 2025 2035 EU China US OECD India Africa
Asia
Growth of the power sector
Power sector’s share of primary Electricity consumption per capita
energy consumption
MWh
50% 10
OECD
8 China
40%
6 Coal
World
4 Gas
30%
India
2 Renew.
Africa
Hydro
20% 0
1965 1975 1985 1995 2005 2015 2025 2035 1965 1975 1985 1995 2005 2015 2025 2035
2017 Energy Outlook

Key features of the energy outlook
• Global energy demand continues to grow, driven by the

burgeoning Asian middle class
• The fuel mix gradually decarbonizes with non-fossil fuels

providing almost half of the increase in primary energy
• The global economy continues to electrify, with the power

sector playing an ever-increasing role in shaping the energy
transition
2017 Energy Outlook
Oil
• How might electric cars and the broader mobility revolution

affect oil demand?
• How might the abundance of oil resources affect the behaviour

of low-cost oil producers?
2017 Energy Outlook

Oil demand
Liquids demand Liquids demand growth
Mb/d Mb/d, average annual growth

120 2.0
Power Power Buildings
Industry Non-combusted
100 Buildings 1.5 Transport Total
Industry
80
Non-combusted 1.0
60
Ships, trains & planes
0.5
40
Trucks
Transport 0.0
20
Cars
0 -0.5
2000 2005 2010 2015 2020 2025 2030 2035 2005- 2010- 2015- 2020- 2025- 2030-
Liquids includes oil, biofuels and derivatives of coal and natural gas 2010 2015 2020 2025 2030 2035
Growth of electric cars
The global car fleet: 2015-2035 Illustrative path for battery pack costs
Billions of vehicles $/kWh

2.0 250
Electric cars
Conventional cars
200 Battery pack costs*
1.5 Non-OECD
OECD
1.0 150 Range of
estimates of
cost parity
100 between
0.5 electric and
oil-powered
50 cars
0.0
By region By type By region By type
0
2015 2035 2015 2020 2025 2030 2035
*For a Battery Electric Vehicle with a 60 kWh pack. Cost projections depend heavily on the degree of EV uptake, which is uncertain, so ranges should be treated
as illustrative only. Current estimates of battery costs also vary widely, but this uncertainty is not shown

Liquid fuel demand from cars
Decomposing changes in liquids demand from cars: 2015-2035
Mb/d
45
40
35
17
30 23
25
0.2 1.2
20
15
10 23
19
5
0
2015 Growth in Gains in fuel Switching to Switching to 2035
demand for travel efficiency natural gas electric vehicles
vehicles
2017 Energy Outlook

Mobility revolution
• Electric cars: lead to a switch away from conventional cars
• Autonomous vehicles: improve fuel efficiency via efficient

driving
• Car sharing: can amplify the effects of new-technology cars
• Ride pooling: reduce total miles driven by pooling journeys
VCMStudy.ir
2017 Energy Outlook 15 © BP p.l.c. 2017
Mobility revolution scenarios
Digital revolution: Electric revolution:
Impact on oil demand in cars in 2035 Impact on oil demand in cars in 2035
Mb/d Mb/d
25 25
20 20
15 15
2017 Energy Outlook

Oil
• How might electric cars and the broader mobility revolution

affect oil demand?
• How might the abundance of oil resources affect the behaviour

of low-cost oil producers?
VCMStudy.ir
2017 Energy Outlook 17 © BP p.l.c. 2017
Abundance of oil resources
Estimates of technically recoverable Oil supply of lower-cost producers
resources and cumulative oil demand
Trillion barrels Mb/d Share
2.8 Europe 70 65%
Low-cost producer’s
share of global liquids
2.4 Asia 60 production (right axis)
Africa 60%
2.0 50 US
S&C America
1.6 40 55%
N America Russia
1.2 CIS 30 50%

0.8 20
Middle East Middle East 45%
0.4 2015- 2015- 10 OPEC
2035 2050
0.0 0 40%
Technically Cumulative demand 1985 1995 2005 2015 2025 2035
recoverable resources
2017 Energy Outlook
Natural gas
Gas supply growth: 2015-2035 Gas consumption by sector
Bcf/d Bcf/d
140 500
Transport
120 Buildings
Australia 400 Power
100 Russia Non-combusted
80 300 Industry
Middle East
Other Other
60 Africa
200
China
40
US 100
20
0 0
Shale Conventional Conventional 1965 1975 1985 1995 2005 2015 2025 2035
decline growth
Growth of LNG
LNG supply LNG demand
Bcf/d Bcf/d
80 80
Other Other
70 Russia 70 Middle East
60 Africa 60 S&C America
United States Asia
50 Australia 50
Europe
Qatar
40 40
30 30
20 20
10 10
0 0
1990 2005 2020 2035 1990 2005 2020 2035
2017 Energy Outlook

LNG Trade
Net LNG exports and imports in 2035 (Bcf/d)
North Russia
America Europe
5
Other
17 Asia
22 Middle
East
9
44
S&C Africa
America
7 Australia
2
Exports
Imports 17 17
2017 Energy Outlook

Carbon emissions
2017 Energy Outlook

Carbon emissions
Contributions to slower growth Carbon emissions
of carbon emissions
% per annum Billion tonnes CO2
2.5% 40
IEA 450
2.0% GDP Base case
30
Energy
1.5% intensity
20
1.0% Fuel
mix
10
0.5%
0.0% 0
1995-2015 2015-2035 1965 1975 1985 1995 2005 2015 2025 2035
2017 Energy Outlook

Faster transition pathways
Carbon emissions Reductions in emissions versus base case
Billion tonnes CO2 Billion tonnes CO2 in 2035

40 0 2 4 6 8 10
Power
CCUS* Faster transition

30
Even faster transition
Industry &
Base case Buildings
Faster transition
Even faster transition Transport
20
1995 2005 2015 2025 2035
*Carbon capture, use and storage (predominantly in power sector)
2017 Energy Outlook

Faster transition pathways
Carbon emissions Reductions in emissions versus base case
Billion tonnes CO2 Billion tonnes CO2 in 2035

40 0 2 4 6 8 10
Power
CCUS* Faster transition

30
Even faster transition
Industry &
Base case Buildings
Faster transition
Even faster transition Transport
20
1995 2005 2015 2025 2035
*Carbon capture, use and storage (predominantly in power sector)
2017 Energy Outlook

Energy outlook under alternative transition pathways
Annual demand growth by fuel The changing fuel mix
Mtoe per annum % of primary energy

250 50%
Non-fossil Oil Coal
200
Coal 40% Gas Non-fossil
150
Gas
100 Oil 30%
50 Total
0 20%
-50
10%
-100
-150 CO2 0%
1995- Base FT EFT 2015 Base FT EFT
2015 2035
2015-35
2017 Energy Outlook

Comparison with other low carbon scenarios
Even IHS Markit

Faster MIT Greenpeace
faster IEA 450 ‘Solar
transition 2° Base ‘Revolution’
transition Efficiency’
Growth rate (% p.a.) 2015-35
Carbon emissions -0.7% -2.0% -2.0% -2.0% -2.8% -3.2%
Total energy 0.9% 0.8% 0.4% 0.5% -0.7% -0.1%
Energy intensity -2.4% -2.5% -3.0% -2.9% -4.0% -3.5%
Carbon intensity -1.5% -2.7% -2.3% -2.5% -2.1% -3.5%
Share of total energy, 2035
Oil & gas 51% 48% 48% 46% 51% 39%
Renewables 16% 23% 17% 29% 19% 38%
Share of abatement vs 2015
Power sector >100% 89% 77% 74% 58% 35%
2017 Energy Outlook

27
Even IHS Markit

Total energy 0.9% 0.8% 0.4% 0.5% -0.7% -0.1%
Oil & gas 51% 48% 48% 46% 51% 39%
Renewables 16% 23% 17% 29% 19% 38%
Power sector >100% 89% 77% 74% 58% 35%
2017 Energy Outlook

Even IHS Markit

Total energy 0.9% 0.8% 0.4% 0.5% -0.7% -0.1%
Oil & gas 51% 48% 48% 46% 51% 39%
Renewables 16% 23% 17% 29% 19% 38%
Power sector >100% 89% 77% 74% 58% 35%
2017 Energy Outlook

Even IHS Markit

Total energy 0.9% 0.8% 0.4% 0.5% -0.7% -0.1%
Oil & gas 51% 48% 48% 46% 51% 39%
Renewables 16% 23% 17% 29% 19% 38%
Power sector >100% 89% 77% 74% 58% 35%
2017 Energy Outlook

Even IHS Markit

Total energy 0.9% 0.8% 0.4% 0.5% -0.7% -0.1%
Oil & gas 51% 48% 48% 46% 51% 39%
Renewables 16% 23% 17% 29% 19% 38%
Power sector >100% 89% 77% 74% 58% 35%
2017 Energy Outlook

31
Even IHS Markit

Total energy 0.9% 0.8% 0.4% 0.5% -0.7% -0.1%
Oil & gas 51% 48% 48% 46% 51% 39%
Renewables 16% 23% 17% 29% 19% 38%
Power sector >100% 89% 77% 74% 58% 35%
2017 Energy Outlook

Risks to gas demand
Global primary energy shares Natural gas growth 2015-2035
% of primary energy Mtoe per annum

40% 20 Increasing climate and
Base case environmental policies
35% Slower gas case
15
Coal
30% Coal
25% 10
20% Gas
5
15%
10% 0
1965 1975 1985 1995 2005 2015 2025 2035 Slower gas Base Faster Even faster
case case transition transition
2017 Energy Outlook
BP Energy Outlook
2017 edition
#BPstats
VCMStudy.ir

BP Energy Outlook 2017 Presentation Slides

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BP Energy Outlook

% per annum % per annum

2017 Energy Outlook

Billion toe % per annum

Other non-OECD Asia 70%

2017 Energy Outlook

• Global energy demand continues to grow, driven by the

• The fuel mix gradually decarbonizes with non-fossil fuels

• The global economy continues to electrify, with the power

• How might electric cars and the broader mobility revolution

• How might the abundance of oil resources affect the behaviour

2017 Energy Outlook

Mb/d Mb/d, average annual growth

Billions of vehicles $/kWh

2017 Energy Outlook 13 VCMStudy.ir © BP p.l.c. 2017

2017 Energy Outlook

• Electric cars: lead to a switch away from conventional cars

• Autonomous vehicles: improve fuel efficiency via efficient

• Car sharing: can amplify the effects of new-technology cars

• Ride pooling: reduce total miles driven by pooling journeys

2017 Energy Outlook

• How might electric cars and the broader mobility revolution

• How might the abundance of oil resources affect the behaviour

1.2 CIS 30 50%

2017 Energy Outlook

2017 Energy Outlook

2017 Energy Outlook

2017 Energy Outlook

Billion tonnes CO2 Billion tonnes CO2 in 2035

CCUS* Faster transition

2017 Energy Outlook

Billion tonnes CO2 Billion tonnes CO2 in 2035

CCUS* Faster transition

2017 Energy Outlook

Mtoe per annum % of primary energy

2017 Energy Outlook

Even IHS Markit

2017 Energy Outlook

Even IHS Markit

2017 Energy Outlook

Even IHS Markit

2017 Energy Outlook

Even IHS Markit

2017 Energy Outlook

Even IHS Markit

2017 Energy Outlook

Even IHS Markit

2017 Energy Outlook

% of primary energy Mtoe per annum

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