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the 2050 conundrum

offshore-based methane reformers.
Gas-to-wire, where gas is used to
produce power offshore for transport
to shore via nearby windfarm cabling.
Offshore platform electrification; with
offshore windfarms installed nearby,
platforms can import renewable
electricity directly.

The natural gas supply and demand outlook
Global upstream gas capital expenditure
is expected to reach USD737 billion
in 2025, dropping to USD587 billion
in 2050. Significant investment FIGURE 3: WORLD PRIMARY FOSSIL FUEL SUPPLY BY SOURCE
will therefore be required to ensure
production meets demand, including
realising the potential from stranded gas However, even with the rapid developed to tackle at least three
reserves and for reserve replacement. changes in decarbonisation and energy fronts simultaneously: higher energy
Until 2040, offshore gas production intensity forecasted, CO₂ emissions efficiency, more renewables, and
will rise, when it will be 58 per cent are still at about half of today’s level industrial-scale CCS.
greater than in 2017. In 2050, it will in 2050. Extrapolating the trends, the Affordability is key. While the planet’s
still be more than a third (39 per cent) ETO points towards a 2.4°C warming future energy system forecast by DNV
higher than in 2017, with the Middle of the planet by the end of this century, GL is more expensive than today’s, in
East and North Africa providing the over the preindustrial average – a level relative terms, it becomes much more
greatest production volumes. considered dangerous by the IPCC and affordable. With an imminent fall in
For most regions, power generation the world’s scientific community. fossil fuel spending, and the rise of
will be the main consumer of gas, low-cost, efficient electrification, this
challenged by manufacturing (mainly Until 2040, offshore gas will lead to operating savings which will
petrochemicals) in China, India, and more than offset ongoing, substantial
Latin America. production will rise, when high capital expenditure on grids. With
it will be 58 per cent greater this reasoning, DNV GL concludes
A licence to operate than in 2017. In 2050, it will that the energy transition is indeed
Pressure on the oil and gas industry still be more than a third (39 affordable and attainable and will allow
remains relentless to safely deliver a for additional investment to tackle such
long-term, secure and environmentally per cent) higher than in 2017, critical challenges.
sustainable supply of affordable energy. with the Middle East and North
The opportunity for the sector to Africa providing the greatest The main ETO report covers the
decarbonise can only be continued if transition of the entire energy mix to
it maintains society’s trust through production volumes 2050 globally and in 10 world regions.
a sharp focus on safe operations and It is accompanied by three supplements
environmental performance (Figure The report concludes by saying forecasting implications for the oil
4). Companies’ ability to display there is no ‘silver bullet’. If the planet and gas, power supply and use, and
the highest standards of safety and is to avoid dangerous warming maritime industries. DNV GL’s suite of
sustainability today will win the public and its potentially catastrophic 2019 Energy Transition Outlook reports
support that the industry needs to consequences, the report’s authors is available to download free of charge
secure a low-carbon future. declare that policies must be urgently from www.eto.dnvgl.com

FIGURE 4: ENERGY TRANSITION TIMELINE: THE OIL AND GAS HORIZON

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