Gas and renewable fuels may edge out oil by 2025, Shell chair says


By 2025, natural gas and renewable resources may provide more global energy than oil, today's dominant fuel, according to Philip Watt, chairman of Royal Dutch/Shell Group's managing directors.

At his Nov. 13 Industry Leaders in Technology and Management Lecture in Wong Auditorium, Watt said technology advances - ranging from cleaner "synfuels" to catalysts that can convert hydrocarbons to hydrogen - could enable this transformation.

Watt's future fuel scenarios suggested that renewables like wind, solar and hydrogen could meet a quarter of the world's energy needs by 2050. Use of coal, nuclear and hydroelectric power is projected to modestly increase by 2050 while worldwide energy demand more than doubles 2000's usage.

In his talk, "The Technology Imperative: Realizing the Potential for Innovation in Meeting Energy Challenges," Watt noted that Shell has long been a partner of MIT's Joint Program on the Science and Policy of Global Change. This relationship has influenced Shell's concern for climate change and advocacy for environment protection, he said, adding that Shell has reduced its own greenhouse gas emissions by 10 percent since 1990.

Technological advances have already transformed the energy industry. Watt said that as a young seismic interpreter working for Shell in Indonesia in the 1970s, his essential tool was a jar of colored pencils. Today, Shell researchers convene via virtual reality centers to integrate high-resolution 3-D and time-lapsed seismic images with geochemical data and life cycle planning.

"The change in the way we see the subsurface is remarkable," he said. "Visualizing geology has transformed our ability to understand it and to share it with others in our business."

Shell's future scenarios play out along both evolutionary and revolutionary paths. Both paths assume resource scarcity, technological advance, and changes in people's behaviors as consumers and citizens.

The dynamics-as-usual model proposes evolutionary but competitive progress from oil to gas to renewables. The revolutionary model, titled the "Spirit of the Coming Age," leaps to a hydrogen economy sparked by breakthroughs in fuel cell and hydrocarbon technologies as well as carbon dioxide sequestration, which reduces the amount of CO2 entering the atmosphere. In this scenario, CO2 emissions will rise from today's 6 billion tons a year to about 10 billion tons in about 2025 before dropping.

Both scenarios build on predictions of sharply rising energy demands from developing countries. "Developing countries will account for most new energy demand," Watt said. "The challenge is to meet these expanding needs while reducing the environmental impact."

China's energy needs, for example, are expected to double by 2020. That country's abundant coal resources now contribute 75 percent of its current energy, but also contribute to air pollution problems. A project underway in Hunan province using Shell's coal gasification process is aimed at creating cleaner fuel from coal. China also plans to expand natural gas use by ninefold by 2020, Watt said.

In developed countries, demand is expected to stay level while the focus shifts to more efficient energy use and more secure supplies, Watt said.

Watt identified technologies that are driving renewable options as well as cleaner and more efficient processes. Shell has developed a catalyst that enables greater use of distant gas reserves by turning them into syngas - ultraclean fuels, he said. Smart wells, the first of which are now operating in Malaysia, automate oil and gas production using multilateral wells with real-time downhole imaging and more selective extraction. A catalytic partial oxidation technology, aimed at converting hydrocarbons to hydrogen in service stations or on vehicles, may be key to switching to renewable hydrogen resources. A zero-emission electricity generation project in Norway is testing a new way to capture carbon dioxide for sequestration underground.

Watt's talk was co-sponsored by the Office of Corporate Relations and the Center for Technology, Policy and Industrial Development.

A version of this article appeared in MIT Tech Talk on December 4, 2002.


Topics: Special events and guest speakers, Environment and energy

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