Forecasting Future Oil Production in Norway and the UK: A General Improved Methodology

Lucas Fievet, Zalàn Forro, Peter Cauwels and Didier Sornette
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Lucas Fievet: ETH Zurich
Zalàn Forro: Independent
Peter Cauwels: ETH Zurich
Didier Sornette: ETH Zurich and Swiss Finance Institute

No 14-46, Swiss Finance Institute Research Paper Series from Swiss Finance Institute

Abstract: We present a new Monte-Carlo methodology to forecast the crude oil production of Norway and the U.K. based on a two-step process, (i) the nonlinear extrapolation of the current/past performances of individual oil fields and (ii) a stochastic model of the frequency of future oil field discoveries. Compared with the standard methodology that tends to underestimate remaining oil reserves, our method gives a better description of future oil production, as validated by our back-tests starting in 2008. Specifically, we predict remaining reserves extractable until 2030 to be 188 ± 10 million barrels for Norway and 98 ± 10 million barrels for the UK, which are respectively 45% and 66% above the predictions using the standard methodology.

Keywords: Monte-Carlo; oil peak; logistic equation; Poisson process; power law distribution (search for similar items in EconPapers)
JEL-codes: C15 C46 O13 Q40 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2014-07
New Economics Papers: this item is included in nep-ene, nep-for and nep-ore
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Persistent link: https://EconPapers.repec.org/RePEc:chf:rpseri:rp1446

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