Transcript
California’s Petroleum Industry
January 2008
Western States Petroleum Association
Western States Petroleum Association
2
Oldest petroleum trade association in the nation; formed in 1907
29 member companies that explore, produce, transport, refine and market
Six states (CA, WA, OR, NV, AZ, HI)
511,701 jobs (178,369 direct, 300,397 indirect); 335,000 jobs in California (115,000 direct jobs, 220,000 indirect)
$173 billion in total sales; $143 billion in California
$27 billion annual payroll; $18 billion in California
$6.3 billion annual sales and excises taxes; $5 billion in California
Western States Petroleum Association
Who we are
Sources: LECG Corp., A Profile of the Petroleum Sector Estimates for 2004
Western States Petroleum Association
California conventional fuel supplies
Petroleum (2006) In-State - 37% Alaska - 21% Foreign - 42%
Electricity (2006) In-State - 78% Imports - 22%
Natural Gas (2005) In-State - 15% Canada - 23% Rockies - 24% Southwest - 38%
3Source: California Energy Commission
Western States Petroleum Association
4
Western States Petroleum Association
Underground Oil
Cogeneration
Natural Gas Processing Plant
Onshore Oil & Natural Gas Production
Imports
Oil Pipeline
Offshore Oil & Natural Gas Production
Natural Gas Pipeline
Petroleum 101: From wellhead to pump
Homes and Businesses
Gasoline, Diesel, Jet
Fuel
Refinery
Western States Petroleum Association
Explore Produce Transport Refine/Process
Storage Tanks
Truck
Market
Cogeneration
Distribution Terminal
Product Pipeline
Natural Gas Wellhead
Distribute
Natural Gas Pipeline
5
Produce 650,000 barrels of crude oil per day –
the 4th largest producing state
Produce 812 million cubic feet per day of
natural gas; ¾ of which is associated gas
Operate14 refineries that make gasoline
Refine 46.5 million gallons of gasoline and 8.7
million gallons of diesel fuel per day.
Western States Petroleum Association
Source: California Division of Oil, Gas and Geothermal Resources
What our members do
6
Western States Petroleum Association
What oil provides
40 percent of the nation’s energy supply
97 percent of the nation’s transportation fuels
Sources: American Petroleum InstituteU.S. Energy Information AdministrationCalifornia Energy Commission
Petroleum Products from a Barrel of Crude Oil in California
7
Western States Petroleum Association
Retail Gasoline Market
Sources: Center for the Study of Energy Markets, University of California;
Authors Severin Borenstein, Jim Bushnell, Copyright 2005
Gasoline Service Stations in California – Ownership 2002
Western States Petroleum Association
8
Western States Petroleum Association
Supply and Demand
Sources: U.S. Energy Information Administration, International Energy Outlook, July 2005; Annual Energy Outlook 2006
California Energy Commission
World petroleum demand projected to increase from 82 million barrels per day in 2004 to 111 million barrels per day in 2025
U.S. crude production projected to increase from 5.4 million barrels per day in 2004 to a peak of 5.9 million barrels per day in 2014
CA demand for gasoline expected to reach 48.6 to 52.1 million gallons per day by 2025
CA demand for diesel expected to reach 13.6 to 13.8 million gallons per day by 2025
Western States Petroleum Association
9
Western States Petroleum Association
Supply and Demand
Sources: California Energy Commission
CA now consumes 44 to 45 million gallons of gasoline and 10 million gallons of diesel fuel per day
Demand for transportation fuels increased nearly 50% in last 20 years
Number of refineries producing gasoline in California dropped from 32 in mid-1980s to 14 today
California now imports 3.5 million gallons of gasoline per day
Transportation fuel infrastructure is inadequate and not keeping up with rapidly growing population and demand
Western States Petroleum Association
10
Western States Petroleum Association
Supply – California Production
California crude oil production has declined 23 percent since 1996
Alaskan production is expected to decline about 1.5 percent per year until 2016
Sources: California Energy Commission
Alaska Department of Revenue
Foreign Crude Oil
California Crude Oil
Alaska Crude Oil
Crude Oil Supplies to California Refineries
Western States Petroleum Association
Imports: California projected gasoline and diesel demand
In-State Refinery Production Supplied to
California
Demand Without Greenhouse Gas
Regulations
Projected Imports
Demand With Greenhouse Gas
Regulations
Bil
lon
Ga
llo
ns
25
15
20
1.9 Billion Gallons
4.6 Billion Gallons
2003 2025Source: California Energy Commission
12
California is an energy Island
Western States Petroleum Association
Source: California Energy Commission
Time required to ship crude oil or products from
Pacific NW: 8 to 10 days
Gulf Coast: 14+ days
Middle East: 40 days
Far East: 40 days
Western States Petroleum Association
13
Western States Petroleum Association
California refinery system runs near its capacity limits
California is isolated from other supply sources
The region uses a unique gasoline that is difficult and expensive to make
Marine Infrastructure is at or near the limits of throughput capacity
If marine infrastructure does not expand, crude oil supplies could become even more constrained
Permits can be difficult to obtainSources: U.S. Energy Information Administration, 2003 California Gasoline Price Study
American Petroleum Institute
California Energy Commission, Transportation Fuels, Technologies, and Infrastructure Assessment Report 2003
Supply Issues
14
Western States Petroleum Association
Where do we go from here?
15
Western States Petroleum Association
Emerging energy technologiesU.S petroleum companies invested $98 billion in frontier hydrocarbons and renewable and alternative energy technologies between 2000 and 2005, 73 percent of the total $135 billion invested
Source: American Petroleum Institute, based on data from more than 250 company annual reports for 2000 – 2005 and U.S. Department of Energy, Energy Information Administration
0 20 40 60 80 100 120
Oil & Gas Companies
Other Private
Federal Government
$5 billion
4% of total
$32 billion
23% of total
$98 billion
73% of total
Western States Petroleum Association
16
Western States Petroleum Association
Shell: wind farm displaces 85,000 tons of carbon dioxide BP: $500 million research to UC Berkeley Chevron: photovoltaic facility to help power operations ConocoPhillips: developing hydrogen infrastructure and
animal fat to renewable diesel process ExxonMobil: exploring new approaches to internal
combustion engine technology Valero: implemented efficiencies that will reduce
greenhouse gas emissions Tesoro: flare gas compressors to reduce flaring Occidental and AERA: cogeneration facilities produce
electric power and steam BP, Chevron, and Shell: members of the California Fuel
Cell Partnership
Renewable and alternative energy California refiners added close to 1 billion gallons of ethanol to gasoline
last year, making California the largest ethanol consuming state in U.S.
Western States Petroleum Association
17
Western States Petroleum Association
Western States Petroleum Association
18
Prices Determined by Supply and Demand, Driven by Crude Oil Costs
Source: American Petroleum Institute: U.S. average price for regular gasoline
Motor Gasoline and Crude Oil Prices: 2001 to 2006
Western States Petroleum Association
What We Pay For in a Gallon of
Diesel
(November 2007)
Taxes
Distribution and Marketing
Refining
Crude Oil
14%
7%
17%
62%
What We Pay For in a Gallon of Regular
Gasoline
(November 2007)
Taxes
Distribution and Marketing
Refining
Crude Oil
13%
9%
10%
68%
Source: Energy Information Administration
Based on U.S. average price per gallon
Gasoline prices
20
Western States Petroleum Association
Oil and Natural Gas Earnings (cents per dollar of sales)
Sources: American Petroleum Institute, U.S. Census Bureau for manufacturing and Oil Daily for the oil and natural gas industry.
21
Western States Petroleum Association
Sources: Based on company filings with the federal government as reported by U.S. Census Bureau and Oil Daily.
Oil and Natural Gas Earnings
22
Western States Petroleum Association
Oil & natural gas new investments and earnings
Source: American Petroleum Institute
Western States Petroleum Association
23
Western States Petroleum Association
The energy Americans consume today is brought to us by investments made years ago or even decades ago.
Today’s oil and natural gas earnings are invested in new technology, new production, and environmental and product quality improvements to meet tomorrow’s energy needs.
The petroleum industry’s earnings are very much in line with other industries and often are lower
Oil & natural gas new investments and earnings
24
Western States Petroleum Association
top related