More importantly, according to BP, world coal reserves in 2006 are exactly the same as were 2005, even by country! This means that exactly 6.2 billion tones of coal (world coal production in 2006) were added into world coal reserves of 2005. In other words, each coal producer in the world added exactly the same amount of coal it produced in 2006 to its reserves of 2005!
When there is no available data, it is quite usual (in statistics world) to carry over a country’s figures from previous year. The question is: for how many years you can do that. Proven oil reserves for UAE, for example, have been carried over 11 years in a row. For Azerbaijan, Turkmenistan and Uzbekistan 9 years, for Iraq and Qatar 6 years. Of course, people now are complaining.
The second law of statistics reporting says make sure you are adding up apples with apples. BP Review has been violating this law for a long time and has rightly been criticized by Peak Oil community. Now, it seems that they are heard, still not by BP though.
When it comes to oil reserves, there are three delicate issues: what is meant with oil and what it includes, what is meant with reserves, and where you get the data from. According to BP, oil reserves are supposed to be “proved” reserves. If that is the case, then why for many countries BP’s oil reserves figures are the same as IHS energy’s “proven+probable” reserves?
Now let me look at the BP’s definitions of oil production and consumption.
Oil Production: “Includes crude oil, shale oil, oil sands and NGLs (the liquid content of natural gas where this is recovered separately). Excludes liquid fuels from other sources such as biomass and coal derivatives.” (BP forgot to add here gas to liquids but not a big deal)
Oil Consumption: “Inland demand plus international aviation and marine bunkers and refinery fuel and loss. Consumption of fuel ethanol and biodiesel is also included.”
Now, in an ideal world, the difference between production and consumption would be stock changes. If you make a chart by subtracting world oil consumption from production you will see a strange pattern.
Until 1981 production is always bigger than consumption, sometimes over 2 million barrels per day (mbd). Starting from 1981 this time consumption is bigger, again, over 2 and even 3 mbd. What does that mean? Stockpiling until 1981, and stock drawing since then. 3 mbd! Does that make sense? No!
Now something important for natural gas data: BP Review states in the footnotes that “as the data are derived from tonnes oil equivalent using average conversion factors, they do not necessarily equate with gas volumes expressed in specific national terms.”
If you make the calculation you will see that except for the U.S., BP’s natural gas production and consumption data assumes a constant 37,681 kilo Joules (heating value) per cubic meter. Whereas. calorific value of gas varies from country to country, both for consumption and production. By the way, BP does not say whether their ton oil equivalent figures for natural gas are based on Gross or Net calorific values.
I do not want to discuss the use of meaningless Reserves/Production ratio. There are already excellent discussions about it elsewhere.
Should we really blame the BP so much? No, its small annual publication is a widely quoted, handy and useful source of information. On top of that, it is free. And BP has enough courage to publish oil reserves figures that IEA and EIA do not even dare! Maybe they think that no data is better than bad data.
Oh, don’t try to find the laws of statistics I mentioned. I made them up..
Tags: BP Statistical Review, Oil Reserves, Oil, Gas
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