Comments: The Prize, Updated
- John Donnelly (JPT Editor)
- Document ID
- Society of Petroleum Engineers
- Journal of Petroleum Technology
- Publication Date
- December 2011
- Document Type
- Journal Paper
- 16 - 16
- 2011. Society of Petroleum Engineers
- 0 in the last 30 days
- 31 since 2007
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The history of the energy industry is a study in technical innovation, entrepreneurs, political figures, and how singular decisions changed not only the oil and gas industry, but also the world at large.
That history is captured particularly well in the writings of Daniel Yergin, chairman of IHS Cambridge Energy Research Associates. He recently published a sequel to The Prize: The Epic Quest for Oil, Money, and Power, which is titled The Quest: Energy, Security, and the Remaking of the Modern World. Published in 1991, The Prize told the story of the history of oil—the technologies, people, and politics that changed the modern world. The new book tells how the current modern energy world came to be and how it might look different in the future.
Much has happened since the first book was written—the conclusion of the Gulf War, the collapse of the Soviet Union, the wave of oil industry consolidation in the late 1990s, and the sharp growth in Chinese and other developing countries’ energy demand. Energy was greatly affected by or central to all of these events and will continue to play a leading role on the world stage, writes Yergin, who addresses several significant contemporary issues in the book:
- Peak oil theory is nothing new and this is the fifth time in modern history that there has been widespread fear that the world is running out of oil. The first time was in the 1880s when oil production was primarily concentrated in the US state of Pennsylvania. But the theory greatly discounts the industry’s ability to innovate and invest as it finds new and better ways to develop resources.
- The growth in shale gas production, and the use of technologies such as hydraulic fracturing and horizontal drilling, are one of the industry’s most significant advances and have permanently changed the global gas landscape in a remarkably short time. He believes the industry will continue to innovate and make progress to try to satisfy some of the public concerns about hydraulic fracturing.
- One natural or geopolitical event can change the energy industry overnight. An example is the nuclear power accident at Fukushima in Japan earlier this year after a tsunami hit the country. That may have ended thoughts of a nuclear power renaissance meeting the needs of a growing global demand for electricity.
- Concerns about energy supply, and energy demand, will continue to drive geopolitical discussion, including how nations can become energy secure from natural disasters and cyber security threats. And political discussion of climate change could significantly affect the world’s future energy mix.
Sometimes overlooked, he writes, is the promise of energy efficiency, which he believes “has the potential to have the biggest impact of all” in satisfying future energy demand. Both the industry and environmental groups agree that the issue is critical and it may become the “first fuel” in any future discussion of balancing global demand with climate change.
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