Peak Supermajors 1Q2016 Results

Overview

Supermajor liquids production increased significantly year-over-year and quarter-over-quarter. This is partly due to a large increase in capital expenditures by the supermajors from 2006 to 2013. Interestingly, this large increase in capital spending has not abated the drop in natural gas production. As supermajor CAPEX spending peaked in in the 4th quarter of 2013 and has dropped by over 50% since, it seems likely that both liquids production and gas production will continue to decline from the historical peaks of 1973 and 2010, respectively.

Liquids Production

The supermajors’ liquids production rate for Q1-2016 was 9,603,000 barrels per day. Year-over-year, production rose by 410,111 barrels per day. Overall production peaked at 30,554,482 barrels per day in Q1-1973. Since reaching this primary peak, Supermajors liquids production rate has fallen by 68.6%. This represents a post-peak compounded annual decline rate of 2.6%. If production continued to linearly decline at this rate, it would reach zero production in 2035. The more recent peak occurred at 11,135,767 barrels per day in Q3-1999. Since reaching the second peak, Supermajors liquids production rate has fallen by 13.8%. This represents a compounded annual decline rate of 0.9%. If production continued to linearly decline at this rate, it would reach zero production in 2119.

Supermajor Oil Production

Supermajor Oil Production

 

Gas Production

The supermajors’ natural gas production rate for Q1-2016 was 40,572,000,000 cubic feet per day. Year-over-year, production declined by 1,858,333,333 cubic feet per day. Overall production peaked at 47,339,390,527 cubic feet per day in Q1-2010. Since reaching this primary peak, Supermajors natural gas production rate has fallen by 14.3%. This represents a post-peak compounded annual decline rate of 2.3%. If production continued to linearly decline at this rate, it would reach zero production in 2052.

Supermajor Gas Production

Supermajor Gas Production

 

Capex

The supermajors’ capex spend for Q1-2016 was $26,716,978,000. Year-over-year, capex spending declined by $10,519,623,400. Overall capex spending peaked at $60,346,622,300 in Q4-2013. Since reaching this peak, supermajors capex spending has fallen by 55.7%. This represents a post-peak compounded annual decline rate of 23.8%.

Supermajor CAPEX

Supermajor CAPEX

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Will Martin is an energy analyst and expert on peak oil and alternative currencies. He is an MBA graduate of Cornell University, where he was a Roy H. Park Leadership Fellow and concentrated on studying sustainability in business through the school’s Center for Sustainable Global Enterprise. Prior to his MBA, Will worked in the energy industry, living in Singapore, Houston and Dubai. Will is a recipient of the 2012 “Pioneer Award” from the Association for the Study of Peak Oil and Gas (ASPO-USA). He currently works as a carbon trading commercial adviser in the San Francisco Bay Area. Will is a bitcoin enthusiast and in 2014 published the book “Anonymous Cryptocurrencies,” which became a #1 best seller in 3 Amazon categories and was the first book to be sold on a decentralized marketplace.

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