Exxon - Energy Outlook 2030

Exxon Mobil Corporation

Outlook for Energy A View to 2030

Outlook for Energy: A View to 2030

Table of Contents Evolution of energy and technology

2

Our key energy challenges

6

Growing global demand

13

Global transportation demand

15

A single-cell oil well?

16

Improving today’s vehicle

18

Thinking outside the tank

20

Global industrial demand

21

Managing emissions

22

Global energy demand and supply

25

The importance of natural gas

27

Options for carbon policy

31

CO2 emissions

32

Integrated energy solutions

34

Key findings

36

Glossary

37

This publication includes forward-looking statements. Actual future conditions (including economic conditions, energy demand, and energy supply) could differ materially due to changes in technology, the development of new supply sources, political events, demographic changes, and other factors discussed herein (and in Item 1 of ExxonMobil’s latest report on Form 10-K). This material is not to be reproduced without the permission of Exxon Mobil Corporation. IFC1

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The Outlook for Energy:

A View to 2030

In our Outlook for Energy – A View to 2030, we see many

the world varies dramatically but equates to an average of

hopeful things – economic recovery and growth, improved

200,000 British thermal units (BTUs) a day. Globally, that

living standards and a reduction in poverty, and promising

translates to 15 billion BTUs every second.

new energy technologies. ExxonMobil believes that meeting future energy needs while But we also see a tremendous challenge: how to meet the

also reducing environmental risk will require an integrated set

world’s growing energy needs while also reducing the impact

of solutions that includes:

of energy use on the environment. • Accelerating energy efficiency, which tempers demand and As the Outlook shows, ExxonMobil expects that global energy



demand in 2030 will be almost 35 percent higher than in

• Expanding all economic energy sources, including oil and

2005, even accounting for the recession that dampened



energy demand in 2009. Other key findings include: • Growth will be led by rapid expansion in non-OECD

countries such as China and India, where energy usage will



rise by about 65 percent.

saves emissions natural gas

• Mitigating emissions through the use of new technologies

and cleaner-burning fuels such as natural gas, nuclear and



other renewable sources.

This multidimensional approach will need trillions of dollars

• Demand will be particularly intense for electric power

in investment, and an unwavering commitment to innovation



generation, which will comprise 40 percent of global energy

and technology that evolves over years and decades. It will



demand by 2030.

require sound, stable government policies that enable access

• Oil and natural gas will remain essential, but other sources

to resources and encourage long-term investments and



including nuclear and renewables (e.g., wind, solar and

technological development. And it will require the global



biofuels) will play an expanded role.

energy industry to operate on a scale even larger than today.

The future of energy is directly linked to the future well-being

Updated each year, The Outlook for Energy is a comprehensive

and prosperity of the world’s people.

look at long-term trends in energy demand, supply, emissions and technology. The report is built upon detailed analysis of

Today, about 1.5 billion people – a quarter of the world’s

data from about 100 countries, incorporating publicly available

population – lack access to electricity. Even more lack modern

information as well as in-house expertise.

cooking and heating fuels. Expanding access to energy – and the opportunities it affords – should be a shared global goal.

ExxonMobil uses the Outlook to guide its long-term investment decisions. We share it publicly to encourage a better

Our energy and environmental challenges are intertwined and

understanding of our company, our industry and the global

their scale is enormous. Today, energy use per person around

energy challenges that we all have a vested interest in meeting.

The Outlook for Energy: A View to 2030

1

Evolution of energy and technology Energy sources and technology evolve

industrial needs of an increasingly wealthy

over time – and each influences the

nation. Coal remained significant and

other. By understanding the history of

helped meet growing electricity demand.

energy and technology, we can better understand the future course of the

From 1950 to 2000, we saw the

energy challenge.

introduction and growth of nuclear energy and the first meaningful appearance of

As an example, the history of energy

modern renewable fuels. Natural gas also

use in the United States over the last

continued to grow and was now fueling

150 years illustrates the way energy use

power generators as well.

and technologies develop over time. Looking out to 2030, we see gradual In the United States in 1850, wood

shifts in energy and technology

was the biggest energy source. But by

continuing. Both the U.S. and world

1900, coal had become predominant.

energy mix continue to grow more

Technology played a role in this trend, as

diverse, which strengthens energy

mining evolved and coal fed the newly

security by reducing the risk from

industrialized nation. America’s access to

disruption to any single supply source.

energy enabled its growth as an industrial

We will need to expand all these

economy; in turn, industrial growth and

sources – and develop new ones –

the wealth it created expanded U.S.

to meet future demand. New energy

energy demand. It is important to note

technologies will open up new energy

that it took about 40 years for coal to

sources, and new end-use technologies

achieve its substantial share.

will reshape demand patterns, just as they have for the last 150 years. It

By 1950, oil was overtaking coal, as

is important to remember, however,

more Americans owned cars and rail

that these shifts happen slowly, over

transport shifted from coal to diesel.

the course of decades. Free markets,

The growth of cars and trucks, as

open trade, and stable legal, regulatory

well as the birth of the commercial

and tax frameworks will facilitate these

airline industry, meant a new need for

positive transformations.

transportation fuels. Improvements in oil-exploration technologies helped keep

Change in energy use and technology

pace with this growing fuel demand.

development is an evolutionary process, but one that often has

Also by 1950, hydroelectric power came into use. And natural gas, considered nearly worthless a generation earlier, grew as a fuel to meet the growing heating and

revolutionary impacts.

Transition to modern energy/technology U.S. Energy Demand Percent

Wood

Coal

Oil

Gas

Hydro

1884 First 1879 First steam turbine commercial incandescent light bulb

1896 Niagara Falls hydroelectric plant opens

Nuclear

100

75

50

25

0

1859 First oil well drilled in Titusville, PA.

1869 Golden spike set in Transcontinental Railroad

1901 First-gasoline powered automobile mass-produced

1907 First drive-in gas station opened

Modern Renewables

1916 First radio turner

Source: Energy Information Administration

1927 Charles Lindbergh flew across Atlantic

1936 1933 Hoover Dam Philo Farnsworth completed develops electronic television

1947 First offshore well out of sight of land

1954 Modern silicon solar cell invented

1956 Interstate Highway Bill signed

1952 First commercial jet service

1969 First flight of the Concorde supersonic jet 1969 Man walks on the moon

1975 Vehicle fuel economy standards (CAFE) enacted by Congress

The Outlook for Energy: A View to 2030

2

1979 The first commercial citywide cellular network was launched in Japan

1980 The first U.S. windfarm consisting of 20 turbines is built in New Hampshire 1981 IBM introduces the personal computer

1992 U.S. "Energy Star" program introduced 1991 First commercial lithium battery

2001 Human genome sequenced

2005 U.S. mandate for ethanol blending into gasoline

2003 First ultra-deepwater well depth greater than 3,000 meters

2009 U.S. natural gas resources now cover about 100 years at current demand due to unconventional gas drilling technology advances (Source: Colorado School of Mines)

Importance of energy Before considering the many energy demand, supply and emissions trends that constitute the world’s energy outlook through 2030, it is worth reflecting on the importance of energy to all aspects of our lives. Fundamentally, the energy outlook is about people – billions of people and their families using energy to improve their daily lives. At a national and international level, it is the lifeblood of modern economies. For developed nations, reliable energy fuels the technologies and services that enrich and extend life. Energy powers advanced computers, improved transportation, expanded communications, cutting-edge medical equipment and procedures, and much more. For developing nations, expanding reliable and affordable supplies of energy supports and even accelerates changes that improve and save lives. Reliable energy means expanded industry, modern agriculture, increased trade and improved transportation. These are building blocks of economic growth that create the jobs that help people escape poverty and create better lives for their children. For these reasons and more, energy issues are vitally important and demand our understanding.

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Your energy footprint

Your energy footprint daily energy use BTUs per Person

740,000 BTUs per Day

North America

Russia/Caspian

Europe

Middle East Direct Energy Use Household Personal Vehicle

Latin America

Indirect Energy Use Asia Pacific

Africa 0

100,000

200,000

300,000

400,000

500,000

The benefits of energy reach far beyond

of the total. In other words, when direct

what we may see in our day-to-day lives.

and indirect energy consumption are Data as of 11/30/2009 counted, each of us has on average an

The energy XOM that people every day – to run Energyuse Outlook

600,000

energy “footprint” that is about Households twice the Personal Car 129057 size of what weNA might typically 146542 consider R/C 96721 7707 File name: as 05A XOMEO-EnergyUse.ai we can categorize personal, or direct, our personal energy consumption. Europe 92112 35434 Placed file(s): None consumption of energy, and it includes the ME 73984 14388 For page: 05 updated: 12/07/2009 fuel used to make electricity for theLast home. In 2005, the average America 9398 LA person in North 21908 Updated by: Carol Zuber-Mallison AP footprint equivalent 30218to 5442 had a daily energy ZM GRAPHICS • 214-906-4162 • [email protected] Africa 35406 1882 (c) 2009, ZM Graphics Inc. To complete the picture, we also need nearly 740,000 BTUs of energy. For: GCG their households drive cars – is what Patand Gabriel / Briantheir Wilburn 817-332-4600

700,000

Public Buildings 117161 29261 45103 26748 8081 10042 2788

800,000

Commercial Tra 80377 28943 52179 62898 25550 10873 8025

Unlimited within ExxonMobilprivate to count theUsage: energy that powers

enterprise, public services and other

The pattern of direct and indirect energy

important needs across society.

use holds true in every region of the world. While the absolute level of energy

This indirect consumption includes energy

use differs, indirect use is larger in every

required to run buildings (schools, hospitals,

region.

retail shops), commercial transportation (trucking, air and rail travel) and industry

As we look at different ways to solve our

(manufacturing, chemicals, steel). Every

energy challenges, we must consider not

member of society benefits from this

only the energy we use in our daily lives,

indirect energy usage – through job

but also the tremendous energy being

opportunities, higher living standards and

used behind the scenes that makes our

overall economic growth.

modern lives possible.

On a global, per-capita basis, indirect energy consumption is about two-thirds

The Outlook for Energy: A View to 2030

5

Our key energy challenges

As we survey the global energy landscape to

need to manage the risks to our climate

Globally, about 2.5 billion people rely

2030, we see several interlocking challenges.

and environment. That includes taking

on traditional fuels such as wood and

meaningful steps to curb carbon dioxide One of the biggest jobs through 2030 will be

(CO2) emissions, while at the same time

to reduce poverty and raise living standards

utilizing local resources to help maintain

around the world. An important factor in

secure supplies.

achieving this goal will be to continue meeting the world’s energy needs safely, reliably and

We can meet these interlocking

affordably, even as population and economic

challenges. To do it, we will need an

growth – particularly in developing countries –

integrated set of solutions that includes

pushes global demand higher by almost 35

expanding all economic energy sources,

percent compared to 2005.

improving efficiency and mitigating emissions through the use of cleaner-

By providing reliable and affordable energy,

burning fuels such as natural gas.

we will also help revitalize economies and enable broad economic gains around the

These solutions must be supported

world. Meeting this demand will not be

by trillions of dollars in new energy

easy, especially considering that the world’s

investment, a long-term focus and constant

energy resources are increasingly found in

technological innovation.

difficult or hard-to-reach places. And it will require the global energy industry to operate

ExxonMobil is committed to pursuing each

on a scale even larger than it does today.

of these integrated solutions.

At the same time, because we want to ensure that today’s progress does not come at the expense of future generations, we

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dung for heating and cooking.

Challenge: meeting basic needs

Challenge: meeting basic needs electricity

Globally, about

modern cooking and heating fuels

Available

1.5

Available

billion people lack access

About 1.5 Billion People with No Electricity

Over the past 150 years, the evolution of

poverty. For nations with widespread

modern energy and technology has enabled

poverty, affordable and reliable energy also

people in developed countries to achieve

is vital to building homes, schools, hospitals

a lifestyle in which access to energy – at

and sanitation systems that can improve XOM Energy Outlook and save lives.

home, at work and on the road – is largely taken for granted. In many of these places,

to electricity.

About 2.5 Billion People with No Modern Cooking or Heating Fuels

For: GCG Pat Gabriel / Brian Wilburn 817-332-4600

the challenge today is largely one of securing

File name: 07A XOMEO-MeetingBasicNeeds.ai As we consider the energy outlook to 2030,

enough reliable, affordable energy to

it is important to keep in mind this “energy

continue meeting these existing needs.

None 07 Last updated: 12/07/2009 gap,” and energy’s potential to lift lives and Updated by: Carol Zuber-Mallison A satellite image of the Earth Placed file(s): For page:

GRAPHICS • 214-906-4162 • [email protected] improve ZM communities in developed and at night shows electricity

But in some parts of the world, the challenge is far more basic. Today, globally, about

(c) 2009, ZM Graphics Inc.

developing nations alike.

usage by region.

Usage: Unlimited within ExxonMobil

1.5 billion people lack access to electricity. Even more live without modern fuels for cooking and heating. Instead, these 2.5 billion people – nearly 40 percent of the world’s population – rely on burning wood, dung or other traditional biomass fuels, which can be dangerous to people’s health and harmful to air quality. Gaining access to energy represents hope and opportunity. It means improved transportation, increased commerce, expanded industry and greater access to health care and other social services – all of which create jobs that help people escape

The Outlook for Energy: A View to 2030

7

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On average, a city of 1 million people in the OECD: Needs 6 million BTUs of energy every second Consumes over 1,000 gallons of oil per minute Uses 150 tons of coal each hour Requires two world-scale power plants Drives 500,000 cars that use over 500,000 gallons of petroleum every day

Naples, Italy, population 1,004,500 The Outlook for Energy: A View to 2030

9

Energy demand to grow significantly

Energy demand to grow sharply population

GDP

energy demand

Billions

Trillions in 2005 Dollars

Quadrillion BTUs

100

700

10

0.9% Average Growth per Year 2005 – 2030

8

2.7% Average Growth per Year 2005 – 2030

600

1.2% Average Growth per Year 2005 – 2030

80 500

6

60

4

40

400

300

200 2

20 100

0 1980

2005

2030

0 1980

2005

2030

0 1980

When ExxonMobil prepares its Outlook for

ExxonMobil expects that global energy

Energy each year, we start with the world’s XOM Energy Outlook economic outlook, because economic

demand will rise by an average annual

activity – along with population growth – is

when the world will be using almost 35

For: GCG Pat Gabriel / Brian Wilburn 817-332-4600

2005

rate of 1.2 percent a year through 2030,

10A XOMEO-WorldFactors.ai percent more energy than it did in 2005. a fundamental driver of energy demand. Placed file(s): None The composition of the world’s energy will For page: 10 Last updated: 12/07/2009 continue to evolve through 2030, as we The economic globally, is the same, Updatedtrend, by: Carol Zuber-Mallison File name:

ZM GRAPHICS • 214-906-4162 • [email protected] will discuss later in the Outlook. and it’s encouraging. (c) 2009, ZM Graphics Inc. Usage: Unlimited within ExxonMobil

While the recession is expected to produce a

It’s important to note that while economic

2 percent contraction in global GDP in 2009,

growth drives energy demand, because

economic growth will return, and return

of expected gains in energy efficiency, our

to a pre-recession rate. In fact, from 2005

projected rate of energy-demand growth

through 2030, we see global GDP expanding

(1.2 percent) is less than half the rate

at an average annual rate of 2.7 percent.

of global GDP growth (2.7 percent) through 2030.

At the same time, the world’s population is expected to rise from 6.7 billion today to almost 8 billion. As we noted earlier, rising populations not only create new demands for energy for personal needs such as fuels for cars and electricity for homes, but also energy that is consumed “indirectly” – the energy that serves the broader society and economy. Together, population and economic growth through 2030 will continue to drive global energy demand higher.

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In the United States and other OECD countries, energy demand will be essentially flat and CO2 emissions will decline through 2030 even as economies and populations grow. Energy efficiency will play a key role.

2030

1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98 1/1/99 1/1/00 1/1/01 1/1/02 1/1/03 1/1/04 1/1/05 1/1/06 1/1/07 1/1/08 1/1/09 1/1/10 1/1/11 1/1/12 1/1/13 1/1/14 1/1/15 1/1/16 1/1/17 1/1/18 1/1/19 1/1/20 1/1/25 1/1/30

45 46 47 47 48 49 50 51 52 53 53 54 55 56 57 57 58 59 60 60 61 62 63 63 64 65 65 66 67 67 68 69 69 70 71 71 72 73 73 76 79

Economic growth drives energy demand Economic growth drives energy demand GDP

energy demand

Trillions in 2005 Dollars

Quadrillion BTUs

60

Global

energy demand will be almost

35

400

%

Non-OECD 50

OECD

300

40

OECD

higher in 2030

200

30

than it was

Non-OECD

in 2005.

20 100 10

0 1980

2005

Data as of 10/28/2009 GDP OECD Non 1/1/80 16631 3627 1/1/81 16928 3645 1/1/82 16953 3682 1/1/83 17420 3768 1/1/84 18236 3913 1/1/85 18893 4027 1/1/86 19473 4214 1/1/87 20150 4403 1/1/88 21074 4588 1/1/89 21876 4719 1/1/90 22524 4781 1/1/91 22894 4877 1/1/92 23334 4967 1/1/93 23632 5127 1/1/94 24350 5352 1/1/95 24948 5610 1/1/96 25679 5895 1/1/97 26547 6198 1/1/98 27165 6336 1/1/99 28016 6548 1/1/00 29085 6913 1/1/01 29400 7140 1/1/02 29820 7423 1/1/03 30380 7856 1/1/04 31333 8453 1/1/05 32117 9057 1/1/06 33063 9770 1/1/07 33885 1055 1/1/08 34141 1118 1/1/09 33023 1139 1/1/10 33391 1191 1/1/11 33961 1249 1/1/12 34743 1313 1/1/13 35544 1379 1/1/14 36350 1447 1/1/15 37176 1517 1/1/16 38011 1591 1/1/17 38866 1668 1/1/18 39743 1748 1/1/19 40640 1833 1/1/20 41552 1921 1/1/21 42436 2010 1/1/22 43339 2102 1/1/23 44261 2199 1/1/24 45203 2300 1/1/25 46165 2406 1/1/26 47127 2507 1/1/27 48110 2612 1/1/28 49113 2721 1/1/29 50137 2834 1/1/30 51182 2953

2030

0 1980

2005

2030

While global energy demand is expected

By contrast, in OECD countries, energy

to rise by almost 35 percent through 2030,

demand is expected to actually be

to fully understand the energy outlook in Energy comingXOM decades, weOutlook need to examine what’s

slightly lower in 2030 versus 2005, even

going

than 50 percent larger on average.

For: GCG Gabriel / Brian Organization Wilburn 817-332-4600 on inPatdeveloped for

11A XOMEO-EconomicGrowth.ai Economic Co-operation and Development

though their economies will be more

File name:

None How is this possible? The main reason is 11A Last updated: 12/07/2009 European nations) and non-OECD nations efficiency. ExxonMobil continues to project Updated by: Carol Zuber-Mallison Placed file(s):

(OECD) countries (like the United States and For page:

GRAPHICS 214-906-4162 • [email protected] (such asZMChina and •India), because the trends substantial improvements in efficiency in OECD (c) 2009, ZM Graphics Inc.

in these two groups can be starkly different. Usage: Unlimited within ExxonMobil

countries. In non-OECD countries, we also see efficiency improving, but faster growth in GDP

Through 2030, the economies of non-OECD

and personal incomes will continue to drive

countries, while still relatively smaller, will grow

demand higher there.

at a much faster rate than those of the OECD. By 2030, these developing economies will have reached close to 60 percent of OECD economic output. In non-OECD countries, rapid economic growth is expected to produce a steep climb in energy demand. In fact, we expect that between 2005 and 2030, non-OECD energy demand will grow by about 65 percent. However, even with this rapid growth, per-capita energy demand in nonOECD countries still will be much smaller

The world uses 15 billion BTUs

than in OECD countries.

of energy every second. As more countries move up the economic ladder, more energy will be required. The Outlook for Energy: A View to 2030

11

Efficiency: reducing demand growth Efficiency: reducing demand growth energy per GDP

energy demand

Millions of BTUs per Unit of Gross Domestic Product in 2005 Dollars

Quadrillion BTUs

10

2030 will

800

Constant 2005 Level

1.2% Average Efficiency Gain per Year 1980 – 2000

reduce global

~300 Quads

600

5

approximately

500

1.2% Average Growth per Year 2005 – 2030

400 300 200 100

0 1980

2005

2030

0 1980

2005

2030

Our world continues to become more energy

was held flat at 2005 levels. In that case,

efficient. From 1980 to 2000, the energy it

global energy demand in 2030 would not

took to produce one unit of GDP fell by an

be almost 35 percent higher than in 2005,

average 1.2 percent a year. This occurred for a number of reasons, including the use

as we currently project; it would be about XOMhigher. Energy Outlook 95 percent Put another way, gains

of new, energy-saving technologies.

Pat Gabriel / Brian Wilburn2030 817-332-4600 in energy efficiency through will curb

For: GCG

12A XOMEO-EnergyPerGDP.ai None about 65 percent. For page: 12 Last updated: 12/07/2009 Updated by: Carol Zuber-Mallison File name:

energy-demand growth through 2030 by We expect efficiency gains to accelerate between 2005 and 2030 versus historical trends, with energy-per-GDP falling at an average global rate of 1.5 percent a year.

Placed file(s):

costs, government mandates and regulations, technology advances and expected CO2

65

(c) 2009, ZM Graphics Inc.

in the future is finding ways to use energy Usage: Unlimited within ExxonMobil

Taking sensible steps to improve energy efficiency is a “triple win” – it saves money, reduces energy demand and curbs CO2 emissions.

emissions costs in OECD countries. Through 2030, the amount of

Improving efficiency at this rate will save a

energy saved through improved

significant amount of energy.

efficiency will be greater than the

Through 2030, ExxonMobil expects global energy demand to grow by an average 1.2 percent. To see how energy efficiency works to curb energy-demand growth, imagine if the world’s economies grew as projected through 2030, but efficiency

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%

ZM GRAPHICS • 214-906-4162 • [email protected] In this respect, the greatest source of energy

more efficiently. This faster pace will be driven by higher energy

energy-demand growth by

700

1.5% Average Efficiency Gain per Year 2005 – 2030

1/1/81 1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98 1/1/99 1/1/00 1/1/01 1/1/02 1/1/03 1/1/04 1/1/05 1/1/06 1/1/07 1/1/08 1/1/09 1/1/10 1/1/11 1/1/12 1/1/13 1/1/14 1/1/15 1/1/16 1/1/17 1/1/18 1/1/19 1/1/20 1/1/21 1/1/22 1/1/23 1/1/24 1/1/25 1/1/26 1/1/27 1/1/28 1/1/29 1/1/30

efficiency through What demand would be without efficiency gains

900

14.3 14.1 14 13.9 13.8 13.6 13.6 13.5 13.3 13.2 13.1 12.9 12.8 12.5 12.5 12.5 12.1 11.9 11.8 11.5 11.4 11.4 11.5 11.5 11.4 11.3 11.1 11 10.8 10.9 10.8 10.7 10.5 10.4 10.2 10 9.8 9.7 9.5 9.3 9.1 9 8.8 8.7 8.5 8.4 8.2 8.1 7.9 7.8

Gains in energy

1000

15

1/1/81 1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98 1/1/99 1/1/00 1/1/01 1/1/02 1/1/03 1/1/04 1/1/05 1/1/06 1/1/07 1/1/08 1/1/09 1/1/10 1/1/11 1/1/12 1/1/13 1/1/14 1/1/15 1/1/16 1/1/17 1/1/18 1/1/19 1/1/20 1/1/21 1/1/22 1/1/23 1/1/24 1/1/25 1/1/26 1/1/27 1/1/28 1/1/29 1/1/30

energy consumed from any single supply source.

293.5 291.9 295.9 308.6 315.7 322.7 334.2 346.3 354.1 359.4 364.1 365.1 367.1 371.4 382.6 393.3 397.7 400.1 406.3 414.5 417.3 424.6 439.7 458.7 470.7 483.5 495.3 499.7 481.8 491.6 501.6 512.2 520.1 527.4 533.8 540.2 546.4 552.5 558.6 564.6 571.1 577.6 584.2 590.9 597.7 603.7 609.8 615.9 622.1 628.4

Growing global demand Growing global demand

By 2030,

energy demand in each sector will increase . . .

. . . but increasing efficiencies will help mitigate growth

Quadrillion BTUs 300

Power Generation

200

Power Generation

Residential/ Commercial

Industrial

power generation will account for

40

%

Data as of 10/28/2009

Transportation Industrial Res/Comm PowerGen

“2005” 89.2 137.2 74.9 169.4

ofTransportation all energy Industrial 53.1

101.5

demand.

Transportation

Res/Comm 63.7

Industrial

Residential/ Commercial

100

“2030” 121.8 167.5 83.2 255.8

Transportation 0

2005

2030

2005

2030

2005

2030

2005

2030

2030 Energy Savings

Broken down by the four main end-use

demand more than doubles through 2030

sectors, the biggest demand for energy

and accounts for 80 percent of total growth

comes from electric power generation – a

in electricity demand through 2030.

fact that might surprise some people, who Anyone asking how the world will meet

XOM Energy Outlook

Transportation is, in fact, in third place

its energy and environmental goals must

For: GCG Pat Gabriel / Brian Wilburn 817-332-4600

behind industrial demand, which represents

consider electric power generation; by

File name:

the energy used for manufacturing,

2030, this sector alone will account for

Placed file(s):

steelmaking and other industrial purposes.

about 40 percent of total primary energy

For page:

Residential/commercial demand is the

demand, and its largest energy source

smallest sector.

will continue to be coal, the fuel with the

may think that transportation is the largest.

highest carbon intensity.

Updated by:

13A XOMEO-GlblDmnd None 13 Last updated: Carol Zuber-Mallison

ZM GRAPHICS • 214-906-4162 • carol@zm (c) 2009, ZM Graphics Inc. Usage: Unlimited within ExxonMobil

Power generation is not only the largest energy-demand sector, but also the

In each sector, demand would be growing

fastest-growing. Through 2030, this sector

much faster without improvements in

represents 55 percent of the total growth

efficiency. Efficiency improvements in each

in energy demand.

sector will add up to significant energy savings each year – reaching 300 quadrillion

The story behind the remarkable increase

BTUs in 2030.

in demand for energy for power generation is not just the high-tech demands of the developed world, but also the more basic needs and economic growth of the developing world. Non-OECD electricity

Rising living standards in non-OECD countries will create new demands for energy through 2030. The Outlook for Energy: A View to 2030

13

Residential /commercial demand

Residential/commercial demand by sector

residential

residential energy use

Quadrillion BTUs

Billion Households

Millions of BTUs per Household

120

3.0

70

Residential

100

80

OECD

2.5 60 2.0

80

50

1.5

60

Non-OECD Commercial

40

Non-OECD

40

30

1.0 20 0.5

20

10

OECD 0

2005

2030

2005

0 1980

2030

2005

0

2030

In the residential/commercial sector –

biomass – fuels like wood and dung – will

the energy we use in our homes and

retain a substantial share of supply, mainly in

businesses – residential demand dominates, the non-OECD. Data as of 11/23/2009 XOM Energy Outlook at about three times bigger than commercial. “2005” This trend continues as demand “2030” in this Residential 81.7 sector grows through 26.0 2030. Commercial

100.4 36.8

For: GCG Pat Gabriel Wilburnsector, 817-332-4600 Note:/ Brian In each we

2005

2030

2030

Data as of 10/28/2009

have included

OECD 14A XOMEO-ResCommDemand.ai “electricity” in the breakdown of demand by Non OECD Placed file(s): None fuel. Electricity, of course, is not a fuel in itself – For page: 14 Last updated: 12/07/2009 Residential energy demand is tied closely Updated by: it must beZuber-Mallison generated by other energy sources Carol File name:

to the total number of households in the

2005

ZM GRAPHICS • 214-906-4162 • [email protected] such as coal and natural gas. But it is (c) 2009, ZM Graphics Inc.

"2005" 68.4 38.1

"2030" 54.9 33.6

important

world. Through 2030, we see the number of

to recognize the share of total electricity that is

There will be 900 million more households

households rising by 900 million, with nearly

consumed by each end-use sector.

in the world by 2030 – and they will need

Usage: Unlimited within ExxonMobil

energy for heating, cooking and appliances.

90 percent of that growth occurring in non-OECD countries. OECD countries today use substantially more energy per household than non-OECD countries. While that remains true in 2030,

3000

80

Non OECD

120

all around the world, households are growing more efficient in their use of energy. Through

100 2030,

the steepest decline in energy-per-

household will come from OECD countries, with 80

more modest rates of improvement in

“2030”

2500

70

OECD “2005”

60

2000 50

non-OECD nations. 1500

60

A diverse mix of energy is used to meet residential/commercial demand. Natural

40

1000

gas and electricity account for most of the growth in this sector through 2030. But

20

14

0

40

30

20

500 10

exxonmobil.com Residential

Commercial

0 1/1/80 1/1/81 1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98 1/1/99 1/1/00 1/1/01 1/1/02 1/1/03 1/1/04 1/1/05 1/1/06 1/1/07 1/1/08 1/1/09 1/1/10 1/1/11 1/1/12 1/1/13 1/1/14 1/1/15 1/1/16 1/1/17 1/1/18 1/1/19 1/1/20 1/1/25 1/1/30

0

OECD

Non OECD

Global transportation demand

Global transportation demand

Data fo

by sector

personal vs. commercial

Millions of Oil-Equivalent Barrels per Day

Millions of Oil-Equivalent Barrels per Day

1/1/80 1/1/81 1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98 1/1/99 1/1/00 1/1/01 1/1/02 1/1/03 1/1/04 1/1/05 1/1/06 1/1/07 1/1/08 1/1/09 1/1/10 1/1/11 1/1/12 1/1/13 1/1/14 1/1/15 1/1/16 1/1/17 1/1/18 1/1/19 1/1/20 1/1/25 1/1/30

25

70

Non-OECD 60

Rail

20

Marine

50

OECD

Aviation Commercial

40

Heavy-Duty Vehicles

30

OECD

15

10

Non-OECD

20 5

Light-Duty Vehicles

10

0 1980

2005

Personal

2030

0

2005

2030

2005

Personal

Transportation is one of the fastest-

but especially in personal vehicles, energy

growing energy demand sectors. It is also

demand is higher in OECD countries today.

2030

Energy Outlook for example,XOM we can use many different fuels

But through 2030, we seeasa of significant Data 10/28/2009 shift. In the OECD, personal transportation “Personal OECD” 15053 File name: 15A XOMEO-TransDemand.ai now for transportation; globally, 98 percent of demand is expected“2005” to drop by 25 percent “2030” 11283 Placed file(s): None transportation runs on fuel made from oil. through 2030, while non-OECD demand “Comm OECD” For page: 15 Last updated: 12/07/2009 more than doubles. “2005” Why is this? First, 13359 Updated by: Carol Zuber-Mallison 16825 Historically, ZM light-duty vehicles – cars, SUVs vehicle ownership is“2030” closely tied to personal GRAPHICS • 214-906-4162 • [email protected] For: GCG

to make electricity, the same is not817-332-4600 true right Pat Gabriel / Brian Wilburn

(c) 2009, ZM Graphics Inc.

Usage: Unlimited within ExxonMobil

largest sub-sector, but that is changing.

2030

2005

Commercial

2030

THESE DATA POINTS MAY BE IN WRONG ORDER

the one associated most closely with oil. While,

and light pickup trucks – have been the

2005

“Personal Non-OECD” 8529 4017 “Comm Non-OECD” 11219 22953

income, and in OECD economies, vehiclesper-capita is already high. So, better fuel economy over time – enabled by greater

Through 2030, light-duty demand flattens

penetration of conventional and advanced

as more efficient vehicles enter the market.

technologies across the fleet – will more

Heavy-duty vehicles (trucks and buses) grow

than offset additional demand created by

the most, the result of a number of factors,

an increase in vehicles per capita. But in

including economic growth and the increased

non-OECD countries, economic progress will

shipment of goods across and between

be accompanied by rapid growth in vehicle

nations, and within local communities.

ownership through 2030.

By 2030, heavy-duty vehicles will have

Commercial transportation demand will

become the largest transportation

grow in all regions, but far more rapidly in

demand segment; aviation and marine

non-OECD countries. By 2030, these fast-

transport also grow significantly, reflecting

developing nations will have overtaken the

global economic links.

OECD as the largest source of commercial transportation demand.

We can classify transportation into two basic categories – personal and commercial. In both,

Heavy-duty vehicles such as commercial trucks will soon overtake personal vehicles as the largest source of transportation-related energy demand. The Outlook for Energy: A View to 2030

15

A single-cell

oil well?

ExxonMobil believes that biofuels from photosynthetic

• Algae-based biofuels likely would not impact the global

algae could someday play an important role in meeting the

food supply. While biofuels made from plants like corn and

world’s growing need for transportation fuels, while also

sugar cane are an expanding energy source, they require

reducing CO2 emissions.

fertile land and fresh water; algae can be grown using land and water unsuitable for plant or food production. Algae also

In July 2009, we announced a significant new project to research

could yield between three and eight times more biofuel per

and develop algae biofuels. Our partner is Synthetic Genomics

acre compared to other biofuel sources.

Inc (SGI), a California-based biotech firm founded by genome research pioneer Dr. J. Craig Venter. The goal of the program: to

Getting these algae fuels from the lab to broad, commercial

produce a commercially scalable, renewable algae-based

scale at the local gas station will be a tremendous

fuel compatible with today’s gasoline, diesel and jet fuel.

undertaking – and could require decades of work.

• Why algae? Scientists already know that certain algae

It is an exciting project that brings together SGI’s expertise in

naturally produce oils similar to the petroleum products we

genomics, synthetic biology, microbiology and biochemistry;

use today. If commercial quantities of these algae-based oils

and ExxonMobil’s expertise in transportation fuels and the

could be developed, they could avoid the need to build the

development of technologies and systems needed to increase

extensive new delivery infrastructure that some other alternative

scale from concept phase to large-scale manufacturing.

transportation fuels might require. ExxonMobil expects to spend more than $600 million on • Algae-based biofuels have potential environmental

this project if research and development milestones are met.

advantages. Through photosynthesis, algae absorb CO2 – the main greenhouse gas – and convert it to useful products,

ExxonMobil’s investment in algae-based fuels is just one part

like oils and oxygen. As a result, fuels made from algae could

of our commitment to the breakthrough technologies and

reduce greenhouse gas emissions.

integrated solutions that will be needed to address rising demand for transportation fuels and other long-term challenges illustrated in our Outlook for Energy.

16

exxonmobil.com

Personal vehicle fleet is growing

Personal vehicle fleet is growing vehicle penetration

fleet by car type

In Millions

China

1500

Million Cars Population

1250

Population 1200

Data

Advanced

1000

Diesel 900

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2025 2030

750

Europe OECD Population Population

600

500

United States

300

Population Population Cars Cars

Gasoline Cars

Cars

250

Cars Cars 0

2005

2030

2005

2030

2005

2030

0 2000

2005

2010

To accurately estimate future demand for

per-capita will be almost 10 times lower than

light-duty transportation fuels, we need

the United States’, with about eight vehicles Data as of 10/28/2009 for every 100 people.

to project the number of vehicles that

US 2005 will be on the world’s roads in 2030, and US 2030 XOMPersonal Energy Outlook the types of fuels they will use. At the same time, the composition of the

2015

231.9 274.6 For: GCG OECD 2005 218.8 Pat Gabriel / Brian 817-332-4600 transportation demand is very sensitive to Wilburnglobal vehicle fleet is expectedEurope to change Europe File name: 17A XOMEO-CarFleet.ai vehicle fleet size, which we forecast from through 2030. Conventional gasoline OECD 2030 261.5 Placed file(s): None China 2005 19.2 income levels and vehicle penetration. vehicles will continue to be the majority, For page: 17 Last updated: 12/07/2009 China 2030 125.5 Updated by:

followed by diesel. Hybrids and other

Carol Zuber-Mallison

2020

2025

2030

294.9 344.1 531.8 543.7 1307.8 1475.9

ZM GRAPHICS–• 214-906-4162 • [email protected] In the United States, vehicle penetration advanced vehicles will grow rapidly; we (c) 2009, ZM Graphics Inc.

the number of vehicles relative to population –

estimate that by 2030 they will constitute

Usage: Unlimited within ExxonMobil

is quite high, at nearly 80 percent, reflecting

approximately 15 percent of the total

the strong correlation between income and

personal-vehicle fleet, compared to less

vehicle ownership.

than 1 percent today.

Europe has a larger population than the

The expanding market share of hybrids and

United States but a similar fleet size,

other advanced vehicles, combined with

reflecting a much lower number of vehicles

ongoing improvements to the fuel efficiency

per capita.

of conventional vehicles, will combine to curb growth in energy demand for

The picture in other areas can be very

transportation through 2030.

different. For example, in China, rising incomes will result in rapid growth in that country’s personal-vehicle fleet through 2030. Yet even in 2030, China’s vehicles-

China today has only about 27 vehicles per 1,000 people, compared to 780 per 1,000 in the United States. Rising incomes in China and other developing countries will produce strong growth in the number of global vehicles through 2030. The Outlook for Energy: A View to 2030

17

Improving today’s vehicle Improving today’s vehicle improvement in mileage Percent Improvement in Miles per Gallon

Engine

Transmission

Body and Accessories

Total

0

5

10

15

Making vehicles more efficient is a goal of

• For transmissions, increasing to a 6-speed

automakers, governments and consumers



or higher transmission, or to a continuously

around the world. Many technologies already



variable transmission, could increase miles

have been developed to substantially improve



per gallon by another 5 percent to 10 percent.

the fuel efficiency of conventional vehicles. These are not far-off innovations; they are

• Potential improvements to the car body

available today, and there is a lot of positive



and accessories include improving vehicle

news in this area.



aerodynamics and reducing vehicle weight



through lightweight materials such as

• Improved engine-based technologies



plastics. They also include tires that stay



can increase miles per gallon by about



inflated longer and higher-efficiency air-



15 percent versus today’s conventional



conditioner compressors. Together, these



gasoline vehicles. For example, engines



technologies could produce a 10 percent to



can be made more efficient via



15 percent improvement in fuel efficiency.



turbocharging, cylinder deactivation



and camless valves.

18

exxonmobil.com

20

Aerodynamics

Lightweight Materials

Turbocharging

Cylinder Deactivation Improved Tires Camless Valves Continuously Variable Transmission

Air Conditioning Efficiency 6 Speed and 7 Speed

25

30

35

When we combine all these improvements

Our view is that compared to hybrids, plug-

to conventional vehicles, we see an overall

in hybrids or electric vehicles, improvements

potential increase in miles per gallon of

to conventional vehicles will likely be a more

about 35 percent.

cost-effective approach for improving lightduty vehicle efficiency through 2030. It’s a

While these technologies are available today,

matter of affordability and scale – making

some have not yet been widely utilized

incremental and economical improvements

because of cost or other issues. We expect,

to the millions of conventional cars that

however, that this will change as automakers

make up the vast majority of new-car sales

seek to ramp up fleet efficiencies to meet

is expected to have a greater overall impact

mandates.

than revolutionary and costly changes in new cars with technologies that as of yet have not proven capable of significantly penetrating the market.

The Outlook for Energy: A View to 2030

19

Thinking outside

the tank

ExxonMobil’s interest in cars and trucks goes far beyond the

energy is required to circulate the oil in the engine. Mobil AFE

fuel tank. Using our expertise not only in fuels and lubricants,

can improve fuel economy by up to 2 percent versus motor oils

but also in chemicals and plastics, we are advancing new

most commonly used.

technologies to make vehicles more fuel efficient. Conventional vehicle efficiency improvements will be a key in

These ExxonMobil technologies may not get much notice from

reducing the demand for personal transportation fuel demand

drivers, but they can add up to significant fuel savings. For

in the OECD by 2030.

example, if all vehicle tires on the road in the United States retained air pressure as well as tires made with our new technology, it

Some of our technologies are already on the road. For example:

would save more than 700 million gallons of fuel annually.

• Working with major tire manufacturers, ExxonMobil

By enabling cars and trucks to travel farther on a gallon of fuel,

developed a new tire-lining technology that uses up to 80

drivers not only spend less money per mile, they also emit

percent less material in the manufacturing process, making tires

less CO2 per mile.

lighter and keeping them properly inflated. A car with underinflated tires burns up to an extra tank of gasoline every year.

Reducing emissions associated with transportation is one of the key long-term challenges outlined in The Outlook for Energy. In

• ExxonMobil has developed lightweight plastics for car

the United States, transportation accounted for 33 percent of all

parts such as bumpers and fuel tanks. Lighter vehicles use

energy-related CO2 emissions in 2008, second only to electric

less fuel; for every 10 percent drop in vehicle weight, fuel

power generation, according to the Department of Energy.

economy improves by 7 percent. ExxonMobil is a leading supplier of polyolefinic polymers used in the manufacture of

In addition to technologies available today, ExxonMobil

plastic car parts.

also is researching advanced engine technologies that could make the internal-combustion engine more efficient,

• We introduced Mobil 1 Advanced Fuel Economy, a

and developing innovations that could advance hybrid and

lower-viscosity synthetic motor oil. Lower viscosity means less

hydrogen-powered vehicles.

20

exxonmobil.com

Global industrial demand

Global industrial demand by sector

by region

by fuel

Quadrillion BTUs

Quadrillion BTUs

Quadrillion BTUs

120

Heavy Industry

100

250

250

200

200

Electricity/ Heat

80 150 60

100

Energy Industry

100

Gas

Other

20

0

Coal

Non-OECD

Chemical

40

Biomass

150

50

50

OECD

2005 2030

2005 2030

2005 2030

2005 2030

0 1980

2005

Oil

2030

0 1980

The industrial sector is the second-largest

2005 to 2030, with China making up

demand sector, behind power generation. In

about 35 percent of that increase. This is

2005, it accounted for nearly 30 percent of

consistent with the robust economic growth

global energy usage. XOM Energy Outlook

and continued industrialization of the

For: GCG

2005

2030

developing world.

Gabriel / Brian Wilburn 817-332-4600 Heavy industryPatand chemicals make up the

name: 21A XOMEO-IndustrialDemand.ai majority ofFile industrial demand. These two Meanwhile, industrial energy demand Data OECD as of 12/02/2009

None is projected to be down slightly from 2005 "2005" "2030" 21 Last updated: 12/07/2009 growth in industrial demand through 2030, to 2030, Heavy despite in Inda near-term 79.2 recovery 110.7 Updated by: Carol Zuber-Mallison Chem 38.2 54.4 GRAPHICS • 214-906-4162 • [email protected] which is theZMresult of economic expansion, demand following the recession. This decline Energy Ind 36.9 37.6 (c) 2009, ZM Graphics Inc. Otherby several14.4 18.5 concentrated in non-OECD countries. will be driven factors: relatively Placed file(s):

sub-sectors will account for 90 percent of the For page:

Usage: Unlimited within ExxonMobil

mature economies, ongoing efficiency gains

The next largest sub-sector is the energy

and a decline in heavy manufacturing as a

industry. Here, energy usage stays about

percentage of OECD economies.

flat through 2030, even as demand for the industry’s products is projected to

Broken down by energy type, oil remains the

grow substantially. This achievement is the

largest industrial fuel through 2030 due to

result of ongoing efficiency improvements

growing non-OECD demand. We see natural

throughout the industry and a reduction in

gas and electricity gaining share while coal

natural gas “flaring.”

declines, reflecting the shift to less-carbonintensive energy sources.

Broken down by country group, industrial energy demand increases by nearly 60 percent in non-OECD countries from

The Outlook for Energy: A View to 2030

21

Data as o Oil 1/1/80 46.8 1/1/81 43.9 1/1/82 42.7 1/1/83 41.9 1/1/84 42.5 1/1/85 42.4 1/1/86 43.5 1/1/87 44.5 1/1/88 45.9 1/1/89 46.4 1/1/90 44.8 1/1/91 45.1 1/1/92 45.3 1/1/93 44 1/1/94 45.1 1/1/95 46.4 1/1/96 47.8 1/1/97 49.2 1/1/98 48.3 1/1/99 49.6 1/1/00 49.9 1/1/01 51 1/1/02 51.4 1/1/03 52.6 1/1/04 54.5 1/1/05 55.2 1/1/06 56.6 1/1/07 56.2 1/1/08 55.2 1/1/09 54.7 1/1/10 55.3 1/1/11 55.9 1/1/12 56.7 1/1/13 57.4 1/1/14 57.9 1/1/15 58.4 1/1/16 58.8 1/1/17 59.2 1/1/18 59.6 1/1/19 59.9 1/1/20 60.3 1/1/25 62.7 1/1/30 65.3

Managing

emissions

ExxonMobil is successfully reducing emissions from its

new facilities under construction, we expect to increase our

own operations. In 2008, we achieved a global reduction of

cogeneration capacity to more than 5 gigawatts by 2011.

10 million metric tonnes of greenhouse gas emissions – about a 7 percent decline from 2007.

• Flare Reduction. Across our operations, we are working to reduce flaring of gas that has no economic outlet as

We reduce emissions by increasing efficiency in our day-to-

well as gas that is flared as a result of maintenance or

day operations, using new energy efficiency technologies and

unexpected operating events. In 2008, we reduced upstream

reducing flaring.

flaring by about 30 percent, and we plan further reductions of more than 20 percent over the next several years

• Efficiency. Since the launch of our Global Energy

compared to 2008 levels.

Management System in 2000, ExxonMobil has identified opportunities to improve efficiency by 15 percent to 20 percent at

Since 2004, we have invested more than $1.5 billion in

our refineries and chemical plants. We have already implemented

activities to increase efficiency and reduce emissions. We plan

about 60 percent of these. Over the past several years, efficiency

to spend at least $500 million more over the next few years.

at our refining and chemicals operations has improved at a rate two to three times faster than the industry average.

ExxonMobil believes that energy efficiency is the most powerful tool for meeting the central challenge outlined in The Outlook

• Cogeneration. ExxonMobil continues to expand its use of

for Energy: how to meet rising demand for energy while also

cogeneration – a process in which we produce electricity to

reducing the impact of energy use on the environment.

power our operations while also capturing heat to make steam needed to transform raw materials into consumer products.

In addition to improving efficiency and reducing emissions

ExxonMobil is an industry leader in this highly efficient form

at our own operations, ExxonMobil also is developing

of energy production, with interest in about 100 cogeneration

technologies to help consumers do the same. This is

facilities in more than 30 locations worldwide. In 2008, we

important because while about 10 percent of petroleum-

added 125 megawatts of power capacity, with the startup

related greenhouse gas emissions are from industry

of new facilities at our refinery in Antwerp, Belgium. With

operations, 90 percent are from consumer use of petroleum.

22

exxonmobil.com

Electricity use is growing rapidly

Com 1218 1279 1354 1414 1488 1583 1671 1768 1851 1935 2026 2116 2165 2248 2344 2437 2544 2657 2764 Res 1740 1788 1846 1929 2023 2102 2187 2294 2379 2456 2591 2692 2756 2902 2996 3104 3239 3293 3427 1/1/80 1/1/81 1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98

Data as of 10/28/2

Electricity use is growing rapidly

by sector

by region

by generation

Thousands of Terrawatt Hours

Thousands of Terrawatt Hours

Thousands of Terrawatt Hours

30

30

30

25

25

Transportation 25

Other Industry

20

Heavy Industry

15

Gas

Other 20

20

Other Asia Pacific 15

15

Coal

10

Oil

China 10

10

Commercial

5

Nuclear 40%

5

OECD

Renewables

United States 2030

Is unit correct?? Growing demand for electricity, and the fuels

0 1980

2005

2030

0 1980

/ Brian Wilburn 817-332-4600 nextPat25Gabriel years as living standards continue

By 2030, we expect that 40 percent of the

to improve worldwide and more people gain

world’s electricity will be generated by

Oil 1302.4 1256.3 1163.9 1131.5 1106.1 1003.8 1016.6 995.7 1025.1 1004.1 1181 1015 981 924.2 933.3 1057.1 1046.8 1058.8 1079.6 1059.1 1022.9 1001.2 992 999.5 1020.8 1026.5 967.2 960.1 945.4 838.9 846.7 851.2 847.8 853.5 860.8 873.6 879.5 885.2 890.3 893.3 893.2 933.2 978.4 Nuclr 635.7 753.7 812.9 922.1 1123.8 1328.5 1431.1 1557 1693 1707.8 1734.1 1825.3 1837.3 1888.5 1935.4 2008.5 2081.4 2067.7 2106.9 2183.6 2235 2299.4 2304.6 2288.1 2371.4 2394.3 2419.1 2378.5 2377.9 2398.4 2444.1 2523.2 2599.5 2666.1 2751.5 2816.9 2887.8 2980 3063 3151.2 3240.3 3790.5 4338.9

ZM GRAPHICS • 214-906-4162 • [email protected] Power generation is the largest energy(c) 2009, ZM Graphics Inc.

nuclear and renewable fuels.

Projecting the future mix of fuels for power

Renew 1554.3 1598.6 1639 1710.7 1780.6 1804.2 1846.8 1860.5 1925.7 1937.8 1995.2 2043.1 2051.2 2156 2185.6 2289.4 2326.3 2370.7 2384.2 2409.2 2479.7 2460 2529.1 2569.9 2737.6 2865.5 3001.4 3091.6 3253.2 3256.6 3402.5 3548.2 3719 3884.4 4053.9 4220 4391 4565.6 4748.6 4928.2 5115.5 5919.5 6754.2

23A XOMEO-ElectricityUse.ai Placed file(s): None access to 23 electricity. Last updated: 12/07/2009 For page: Updated by: Carol Zuber-Mallison

Coal 2664.7 2708 2761.5 2878.7 2982 3116.3 3205.1 3390.7 3498.5 3556.8 3805.4 3920.2 3977.8 4053.6 4174.6 4287 4488.9 4621.5 4700.1 4818.1 5164 5217.8 5438.4 5821.7 5998.3 6344.1 6718.6 7158 7218.8 6793.3 6935.8 7125.2 7342.8 7490.9 7598.8 7718.6 7815.4 7882.2 7950.2 8018.5 8081.1 8449.6 8815.8

putting a cost on carbon emissions.

File name:

generation is a complex task with many

rising at an average of approximately 1.7

variables. As part of this process, we must

percent a year and will account for about

consider how these fuels will compete

40 percent of all energy demand, up from

economically, because these are the real-life

36 percent in 2005 and 26 percent in 1980.

factors that utilities and power generators

This will support strong increases in global

look at when considering which fuels to use

electricity demand, which will be about four

or what types of new power plants to build.

1/1/80 1/1/81 1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98 1/1/99 1/1/00 1/1/01 1/1/02 1/1/03 1/1/04 1/1/05 1/1/06 1/1/07 1/1/08 1/1/09 1/1/10 1/1/11 1/1/12 1/1/13 1/1/14 1/1/15 1/1/16 1/1/17 1/1/18 1/1/19 1/1/20 1/1/25 1/1/30

demand sector and the fastest-growing, Usage: Unlimited within ExxonMobil

2030

ones that seek to reduce emissions by

used for power generation, is a major trend XOM Energy Outlook of the last 25 years, and will remain so for the For: GCG

2005

Gas 887.4 915.4 944.7 987.2 1098.9 1164.7 1212 1313.7 1371.3 1524.6 1488 1519.6 1529.6 1570.5 1636.2 1722.8 1780.7 1919.5 2042 2238.4 2323 2475.4 2616.8 2752.3 2947.1 3109.8 3247.3 3541.6 3633.3 3584.4 3790.8 3972.1 4182.1 4347.6 4503.7 4645.2 4826.4 5007.6 5192.4 5380 5581.3 6590.7 7643.8

2005

Other Asia Pacific Europe

5

Residential 0 1980

Non-OECD

By 2030, about 40 percent of the world’s electricity will be generated by nuclear and renewable fuels.

times higher than 1980. Electricity demand rises at a much faster rate in non-OECD countries, reflecting their faster economic growth and relatively low electricity penetration to date. What fuels will be used to generate this electricity? Through 2030, there is a shift away from coal toward natural gas, as well as to nuclear and renewable fuels. This will be driven by environmental policies, including

The Outlook for Energy: A View to 2030

23

1/1/80 1/1/81 1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98 1/1/99 1/1/00 1/1/01 1/1/02 1/1/03 1/1/04 1/1/05 1/1/06 1/1/07 1/1/08 1/1/09 1/1/10 1/1/11 1/1/12 1/1/13 1/1/14 1/1/15 1/1/16 1/1/17 1/1/18 1/1/19 1/1/20 1/1/25 1/1/30

Electricity generation cost

Electricity generation cost U.S. baseload plants, startup 2025

“Baseload plants” are electric power plants that run continuously to meet minimum electricity demand requirements while peaking power plants run intermittently to meet seasonal and daily peak electricity demand.

Cost per Kilowatt Hour in 2009 Cents 20

20

XOM

20

No CO2 Cost

At $30 per Ton

For: GC Pa

At $60 per Ton

File nam 15

15

Placed f

15

For page

Updated 10

10

ZM GR

10

Usage: U

5

0

5

Coal

Gas Nuclear Wind* Coal/ Gas/ Solar* CCS** CCS**

0

5

Coal

Gas Nuclear Wind* Coal/ Gas/ Solar* CCS** CCS**

* Wind and solar exclude additional costs for intermittency and transmission investments

0

Coal

Gas Nuclear Wind* Coal/ Gas/ Solar* CCS** CCS**

** With carbon capture and storage technology

In the United States, absent any policies

Carbon capture and storage (CCS), a

that impose a cost on CO2 emissions, we

process in which CO2 emissions are

would expect coal and natural gas to be the

captured before they can enter the

lowest-cost options for future, new-build

atmosphere, holds promise in the future.

However, even with CO2 emissions priced Data as of 10/28/2009 at $60 per ton, new-build plants with CCSGas Coal no CO2 4.71 remain2009cents/kWh challenged and very expensive – 5.48 But policies that impose a costLow, on carbon no CO2 2009cents/kWh 1.82of 1.84 meaning a less affordable source would sway these economics. Delta, Coal, being 30$/ton electricity for consumers. This high cost, the most carbon-intensive fuel, would Low, with CO2 2009cents/kWh 7.08 6.54 combined with the need to build a regulatory increase in price more than natural gas. Delta, with CO2 2009cents/kWh 1.82 1.84 gas would framework for CO2 storage, presents At $30 per ton of CO 2, natural 60$/Ton become the most economic alternative challenges for its use over the 7.6 Low, withfor CO2 significant 2009cents/kWh 9.46 with 2009cents/kWh 1.82 1.84 new-build power plants. This isDelta, where weCO2 next two decades beyond governmentpower plants.

expect CO 2 costs may evolve over the

subsidized demonstration projects.

next 10 years. Likewise, solar energy faces significant As the CO2 price increases, we would expect

hurdles to becoming economically

to see fuel switching from coal to natural

competitive in this time frame. The cost of

gas. This will happen by running existing

capturing solar energy in photovoltaic cells or

natural gas plants at higher load factors, as

concentrators remains generally unaffordable

well as by building new natural gas plants

for large, commercial applications.

and retiring old coal plants. At $60 per ton, natural gas is still very competitive. In addition, nuclear and wind are

Climate policies that put a “cost”

now competitive, which is why we include

on CO2 emissions will shift the

strong growth for both in our Outlook.

economics of fuels used for power generation. Natural gas, nuclear and wind stand to benefit.

24

exxonmobil.com

Nuclear 7.16 1.26

Wind 6.59 1.84

Coal + CCS 9.21 2.2

G 8 2

7.16 1.26

6.59 1.84

9.49 2.2

8 2

7.16 1.26

6.59 1.84

9.77 2.2

8 2

Data fo 1/1/80 1/1/81 1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98 1/1/99 1/1/00 1/1/01 1/1/02 1/1/03 1/1/04 1/1/05 1/1/06 1/1/07 1/1/08 1/1/09 1/1/10 1/1/11 1/1/12 1/1/13 1/1/14 1/1/15 1/1/16 1/1/17 1/1/18 1/1/19 1/1/20 1/1/25 1/1/30

Global energy demand and supply

Global energy demand and supply by sector

by energy type

Quadrillion BTUs

Quadrillion BTUs 700

700

Wind, Solar, Biofuels Hydro, Geo 600

600

Residential/ Commercial

500

Biomass

Industrial

400

300

500

Nuclear

400

Coal

300

Transportation

Gas 200

200

100

100

Power Generation

0 1980

2005

Oil

0 1980

2030

2005

of total energy.

particularly in non-OECD countries, will boost

No single fuel can meet our energy challenges.

Ind 110.1 106.3 103.6 103.4 108.1 108.8 110.2 114.1 117.9 118.9 113.1 112.7 111.6 109.9 112.1 117.4 119.5 121.7 120.7 120.1 121.9 120.9 122.5 127.7 134.2 137.2

the need forXOM energy in all four end-use sectors – Energy Outlook

Res/Comm 58.1 57.7 57.9 58.1 59.9 61.1 61.5 62.4 63.7 64 64.1 65.4 65 66.6 65.8 67.1 69.8 68.7 67.3 69 69.8 70.6 71.1 73.3 74.2 74.9

will remain relatively small at about 2.5 percent

picture is clear: Expansion and progress,

Data for left chart as of 10/28/2009

Through 2030, the global energy-demand

To satisfy projected increases in global energy

Placedin file(s): None this will stack up to significant gains efficiency,

affordable energy to help meet our interlocking

File name: 25A XOMEO-TransDemand.ai and residential/commercial. Even assuming demand to 2030 – and ensure reliable and

PowerGen Trans 76.2 51.9 77.8 51.6 78.8 51.5 82.2 52.1 86.9 53.6 91.1 54.7 94.2 56.8 98.9 58.8 103.2 61.4 108.1 63.1 117.9 64.2 121.1 64.9 122.3 66.2 123.5 67.1 124.8 68.6 127.6 70.5 131.8 72.2 133.4 73.9 136.4 75.8 139.4 77.9 143.3 79.4 146 79.8 149.4 81.5 155.3 83.4 163.2 87.1 169.4 89.2

For: GCG power generation, transportation, industrial Pat Gabriel / Brian Wilburn 817-332-4600

25 Carol Zuber-Mallison

2030

Last updated: 12/07/2009 a significant increase in global energy demand social, economic and environmental challenges – For page:

Updated by:

(c) 2009, ZM Graphics Inc.

through 2030.

Unlimited within What types Usage: of supplies will ExxonMobil we use to meet this

rising need for energy through 2030?

1/1/80 1/1/81 1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98 1/1/99 1/1/00 1/1/01 1/1/02 1/1/03 1/1/04 1/1/05

to 2030 – anZMaverage 1.2 percent a• year. we will need to expand all economic fuel sources GRAPHICS • 214-906-4162 [email protected]

Technology will play a key role. Many do not realize that energy already is a high-tech

Fossil fuels – oil, natural gas and coal – will

industry. New innovations and improvements

continue to meet most of the world’s needs

in energy technology continue to advance the

during this period, because no other energy

potential for all sources of energy.

ExxonMobil scientists and engineers use 3-D seismic technology to locate oil and natural gas deposits with greater accuracy and a smaller environmental footprint.

sources can match their availability, versatility, affordability and scale. The fastest-growing of 700these fuels will be natural gas, because

Res/Comm

700

Industrial

600

support increasing needs for power generation.

Transportation

500

Wind, solar and biofuels will grow sharply

PowerGen

it is the cleanest-burning. By 2030, global demand for natural gas will be more than 600 55 percent higher than it was in 2005.

500 power will also grow significantly to Nuclear 400

300 2030, at nearly 10 percent per year on through

400

300

average. However, because they are starting

200

from a small base, their contribution by 2030

100

200

100

The Outlook for Energy: A View to 2030

25

O 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 2

Global energy demand and supply Global energy demand and supply

Oil and natural gas

demand and supply

Annual Energy Savings

Quadrillion BTUs 300

250

Oil Average Growth Rate Per Year 0.8%

NonOECD

200

Total Energy Growth

Gas 1.8% Coal 0.5%

150

OECD

50

0

2005 2030

2005 2030

2005 2030

2005 2030

NonOECD

Nuclear 2.3%

2005 2030

Hydro, Geo 2.2%

Wind, Solar, Biofuels 9.6%

2005 2030

2005 2030

2005-2030

through 2030, Data as of 10/28/2009

but the most

By Fuel "2005" Oil 171.1 important “fuel” Coal 112.3 Gas 100.4 of all will be 45.1 Biomass Nuclear 28.6 Hydro, Geo saved11.8 energy Wind, Solar, Biofuels 1.5 Total Energyimproved Growth through Energy Savings

2030

Today, fossil fuels provide the majority of

Total global energy demand through 2030

the world’s energy, led by oil and then coal

is expected to rise by about 160 quadrillion

and natural gas. Biomass and nuclear

BTUs. All of this growth will occur in non-

come next, followed by hydroelectric and

OECD countries; OECD demand is expected

geothermal power. Wind, solar and biofuels

to be slightly lower in 2030 versus 2005.

combine for a very small share. Through 2030, the most important “fuel” In 2030, fossil fuels remain the

of all will be the energy saved through

predominant energy sources, accounting

improvements in energy efficiency. Energy

for nearly 80 percent of demand. Oil still

saved through efficiency gains will

leads, but natural gas moves into second

reach about 300 quadrillion BTUs per

place on very strong growth of 1.8 percent

year by 2030, which is about twice

a year on average, particularly because

the growth in global energy demand

of its position as a favored fuel for power

through 2030. Most of the energy saved

generation.

through efficiency will be in OECD countries.

XOM Energy Outlook

For: GCG Pat Gabriel / Brian Wilburn 817-332-4600 File name: Placed file(s): For page: Updated by:

26A XOMEO-GlblDmndSu None 26 Last updated: 12 Carol Zuber-Mallison

ZM GRAPHICS • 214-906-4162 • carol@zmgra (c) 2009, ZM Graphics Inc.

Usage: Unlimited within ExxonMobil

Other energy types – particularly nuclear,

ExxonMobil has partnered

wind, solar and biofuels – will grow sharply,

with the National Community

albeit from a smaller base.

Action Foundation to help low-income Americans save money and energy by

Other reputable sources, including the

weatherizing their homes

U.S. government’s Energy Information

through the U.S. Department

Administration and the International

of Energy’s Weatherization

Energy Agency, share a similar view of

Assistance Program.

this supply picture.

26

exxonmobil.com

"2030" 206.9 127 156.9 51.2 50.9 20.1 15.4 157.6

efficiency.

100

Biomass 0.5%

remain essential

The importance of

natural gas

Natural gas will provide a growing share of the world’s energy through 2030. Affordable and abundant, natural gas can help provide the energy needed for economic and social progress. And because it burns cleaner than oil and much cleaner than coal, natural gas is a powerful tool for reducing the environmental impact of energy use. ExxonMobil produces more natural gas than any other public company in the world. We also develop breakthrough natural gas technologies that make more of this cleanerburning fuel available to consumers around the world. In the United States, ExxonMobil technologies have unlocked vast new resources of natural gas that previously were trapped in dense rock formations, as well as other types of so-called “unconventional” natural gas. These technologies

cargo than conventional LNG carriers, reducing transportation

have resulted in a significant upswing in U.S. natural gas

costs while improving efficiency and reducing emissions.

production, and may have similar applications in other parts of the world.

• We are building state-of-the-art LNG receiving terminals in the United State and Europe. In 2009, off the coast of Italy, we

• Our Multi-Zone Stimulation Technology (MZST) allows

opened the world’s first offshore gravity-based structure

operators to create fractures in reservoir rock at a more rapid

for unloading, storage and re-gasification of LNG. The terminal’s

rate than conventional technology so gas can flow more

main structure rests on the seabed in 95 feet of water, about 10

easily. Using MZST and our Fast Drill Process, ExxonMobil

miles offshore, and out of sight of land.

is increasing recovery and production rates while reducing development costs and our environmental footprint.

• ExxonMobil, together with its partners, is producing nearly 35 million tons per year of LNG. We anticipate increasing our

• ExxonMobil has joined with Qatar Petroleum and other

joint production to almost 65 million tons per year by 2010. And

partners to further develop Qatar’s North Field, the largest

beyond 2010, we expect this to go up to around 100 million

non-associated natural gas field in the world. There, we

tons per year.

plan to develop natural gas resources exceeding 150 trillion cubic feet, which will serve a global customer base.

The most significant single use of natural gas is as a fuel to make electricity. As The Outlook for Energy shows, the world’s

Liquefied Natural Gas (LNG): ExxonMobil is a global leader in

need for electricity – and the fuels used to produce it – will grow

developing and delivering advanced LNG technologies. These

substantially over the coming decades. Natural gas can help

breakthroughs are creating a “global gas market” that can link

meet this growing need for electricity.

the world’s largest natural gas reserves, such as those in Qatar, with consumers who need them.

Natural gas used for electricity can reduce CO2 emissions by up to 60 percent versus coal, which today is the most popular

• ExxonMobil helped pioneer a new class of LNG carriers.

fuel for power generation. It also has fewer emissions of sulfur

These ships, called Q-Max, can carry up to 80 percent more

oxides and nitrogen oxides.

The Outlook for Energy: A View to 2030

27

Global liquids supply grows Global liquids supply grows

1/1/80 1/1/81 1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98 1/1/99 1/1/00 1/1/01 1/1/02 1/1/03 1/1/04 1/1/05 1/1/06 1/1/07 1/1/08 1/1/09 1/1/10 1/1/11 1/1/12 1/1/13 1/1/14 1/1/15 1/1/16 1/1/17 1/1/18 1/1/19 1/1/20 1/1/21 1/1/22 1/1/23 1/1/24 1/1/25 1/1/26 1/1/27 1/1/28 1/1/29 1/1/30

C+C 34646 35378 36375 37203 38733 39029 39005 39371 39285 38395 38533 38072 36952 36070 36627 36968 37942 38581 38684 38672 39493 39966 40829 41492 41847 41660 41455 41520 41053 40851 40472 40106 39724 39462 39320 39159 39439 39716 39846 40176 40401 40825 41067 41160 41283 41354 41468 41578 41624 41573 41681

Sands 163 146 165 217 193 255 315 334 369 374 344 350 363 376 396 428 443 526 590 568 608 659 741 867 1002 1002 1160 1215 1222 1250 1300 1400 1430 1510 1550 1650 1860 2010 2140 2310 2440 2600 2720 2860 2970 3110 3270 3430 3590 3740 3880

Cond. 4834 5054 4997 5139 5164 5215 5370 5640 5963 6107 6108 6281 6625 6963 7277 7674 7995 8202 8378 8738 9253 9409 9711 9910 10501 11011 11102 11405 12018 12575 13175 13870 14333 14669 15007 15206 15465 15660 15924 16112 16401 16573 16762 16985 17204 17584 17852 18085 18284 18451 18648

Biofuels 51 57 82 107 149 164 152 168 172 175 177 185 188 197 213 220 199 205 211 220 213 233 271 335 380 442 587 754 1012 1085 1234 1310 1389 1461 1534 1612 1661 1712 1767 1824 1885 1954 2029 2111 2201 2299 2406 2525 2659 2811 2984

Through 2030,

OPEC and non-OPEC

global liquids supply and demand Millions of Oil-Equivalent Barrels per Day

sources will combine

120

to meet an expected

100

2030 Adds ~37

80

OPEC NonOPEC

~34 ~28

Liquids Demand

Biofuels

~27

60

OPEC Crude

Other Petroleum

2005 Supplies

Canada Oil Sands

40

Non-OPEC Crude and Condensate

20

0 1980

1990

2000

2010

2020

2030

Base/Adds

The world’s liquid fuel supply consists mostly of crude oil, but also includes condensate,

Total liquids supply needed in 2030 is about

natural gas liquids and biofuels. Liquid fuels

20 MBDOE above 2005. This increase will

will be especially important for meeting XOM Energy projected strong growth inOutlook transportation

nearly equal share.

be met by non-OPEC and OPEC liquids in

For: GCG

Pat 2030. Gabriel / Brian Wilburn demand through Nearly all 817-332-4600 the world’s

File name: 28A XOMEO-LiquidsSupplyGrows.ai transportation runs on liquid fuels because Meeting this demand in an economic Placed file(s):None

they provide a large quantity of energy in For page:

28

Last updated:

and environmentally sound manner is an

12/07/2009

small volumes, making them easy to transport Updated by: Carol Zuber-Mallison

ongoing task of the global energy industry.

ZM GRAPHICS • 214-906-4162 • [email protected] and widely available. It will require large investments to maximize (c) 2009, ZM Graphics Inc.

Usage: Unlimited within ExxonMobil

yields from mature fields as they naturally

24

%

increase

in liquid fuels demand.

New technologies – such as floating offshore 2005 Base 84130

Non OPEC 8594

OPEC 11463

platforms that can reach crude oil located Base/Adds

Through 2030, total liquids demand

decline, and develop new sources of

under thousands of feet of water – are helping

increases steadily to 104 MBDOE – about

supplies in existing development areas as

meet rising global demand for oil.

24 percent higher than in 2005.

well as promising new regions.

To meet this demand, non-OPEC supplies are projected to grow to about 67 MBDOE, including about 3 MBD from biofuels. Gains also are expected in “other” non-OPEC petroleum, which includes natural gas liquids, condensate, gas-to-liquids, coal-to-liquids and refinery gains. The gap between non-OPEC supplies and total liquids demand – known as the “call on OPEC crude” – remains relatively flat in the near term, but then expands to 37 MBDOE in 2030. This level is achievable, given OPEC’s large resource base and continued investment. 28

exxonmobil.com

1/1/80 1/1/81 1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98 1/1/99 1/1/00 1/1/01 1/1/02 1/1/03 1/1/04 1/1/05 1/1/06 1/1/07 1/1/08 1/1/09 1/1/10 1/1/11 1/1/12 1/1/13 1/1/14 1/1/15 1/1/16 1/1/17 1/1/18 1/1/19 1/1/20 1/1/21 1/1/22 1/1/23 1/1/24 1/1/25 1/1/26 1/1/27 1/1/28 1/1/29 1/1/30

Natural gas supply and demand balance

Natural gas supply and demand balance

Data as o

United States

Europe

Asia Pacific

Billions of Cubic Feet per Day

Billions of Cubic Feet per Day

Billions of Cubic Feet per Day

120

120

120

100

100

100

80

80

80

LNG 60

Imports Imports

Pipeline Unconventional

40

Local Production

20

60

LNG

40

Pipeline

2010

2020

2030

Imports

60

Pipeline

40

Unconventional

Unconventional 20

Conventional 0 2000

2010

2020

Local Production

Local Production

2030

0 2000

Natural gas will meet a growing share of

In Europe, local natural gas production

our energy needs through 2030. Given its XOM Energy Outlook abundance and properties as a clean-burning

continues to decline, driving imports from

Pat Gabriel / Brian Wilburn 817-332-4600 fuel, expanded use of natural gas in power

to about 70 percent in 2030. This shift will

For: GCG

Conventional

20

Conventional 0 2000

LNG

2010

2020

2030

about 45 percent of total supply in 2005

29A XOMEO-GasSplyDmndBalance.ai require growth in pipeline imports from Russia Placed file(s):None help advance environmental goals as well. and Caspian countries as well as LNG. For page: 29 Last updated: 12/07/2009 Updated by: Carol Zuber-Mallison File name:

generation can serve economic progress and

ZM GRAPHICS • 214-906-4162 • [email protected] Total natural gas demand in the United In Asia Pacific, domestic natural gas (c) 2009, ZM Graphics Inc.

States and Europe will follow a similar

production – unconventional in particular –

pattern – dipping in the near term because

continues to climb, but at a slower pace

of the recession, and then growing

than demand. As a result, Asia Pacific will

modestly through 2030. Growth averages

need to rely more heavily on gas imports,

about 0.8 percent per year. Asia-Pacific

especially LNG, which will meet more than

demand grows much more rapidly, at almost

one-third of the region’s demand in 2030.

Usage: Unlimited within ExxonMobil

ExxonMobil and Qatar Petroleum’s Q-Flex and Q-Max ships are fostering a new “global gas market” that can link the world’s largest natural gas reserves with the consumers who need them.

4 percent per year, with demand more than doubling over the outlook period. In terms of supply, an important development has been the expansion of unconventional natural gas – the result of recent improvements in technologies used to tap these hard-toreach resources. This is particularly the case in the United States, where it is expected to satisfy more than 50 percent of demand by 2030. The growth in unconventional supplies will moderate the need for liquefied natural gas (LNG) imports in the United States in the short term.

The Outlook for Energy: A View to 2030

29

Conv 46.58 42.34 43.58 41.16 39.34 36.72 34.9 36.2 35.17 30.89 30.41 30.13 27.96 27.07 26.16 25.26 24.43 23.66 22.93 22.24 23.81 23.84 24.43 23.98 23.41 22.87 22.37 21.89 21.44 21 20.58

Uncon 8.28 9.17 10.24 11.05 12.17 13.3 14.56 17.66 20.24 21.26 20.67 21.07 22.78 24.91 27.08 29.35 31.73 33.79 35.33 36.56 37.44 38.02 38.4 38.64 38.86 39.1 39.34 39.57 39.8 40 40.2

Oil 128.1 123.5 120.5 120 122.1 121.9 125.5 128.2 132.8 134.7 136.6 137.6 139.1 138.8 141 144.2 147.8 150.8 152 155.4 156.4 157.7 159.3 162.6 168.3

Coal 70.3 70.4 70.7 72.5 75.5 77.8 78.4 81.9 84.6 85.8 86.2 85.6 84 84.1 84.7 88.2 89.7 89.4 89 87.3 89.7 90.3 92.4 99.2 107

Chart of left, Data

Global energy demand and CO2 emissions

1/1/80 1/1/81 1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98 1/1/99 1/1/00 1/1/01 1/1/02 1/1/03 1/1/04

Global energy demand and CO2 emissions energy supply

CO2 emissions by sector

CO2 emissions by fuel

Quadrillion BTUs

Billion Tons

Billion Tons

700

40

40

0.9% Average Growth per Year 2005 – 2030

1.2% Average Growth per Year 2005 – 2030

600

Other 500

Residential/ Commercial

30

30

Gas

Transportation

Gas

400

0.9% Average Growth per Year 2005 – 2030

20

20

Oil

Industrial

300

Oil

200

10

10

Power Generation

100

Coal

Coal 0 1980

2005

2030

Rising emissions of CO2 and other greenhouse

share as fuels for power generation.

gases pose significant risks to society and

Natural gas used for power generation

ecosystems. Since most of these emissions

can result in up to 60 percent less CO2

are energy-related, any integrated XOM Energy Outlook approach

emissions than coal, currently the most

0 1980

to meeting For: the GCG world’s energy needs Pat Gabriel /growing Brian Wilburn 817-332-4600

widely used fuel for power generation.

file(s): None strategies toPlaced curb emissions and address the

Broken down by end-use sector, power

For page:

30 Last updated: 12/07/2009 generation accounts for the largest Carol Zuber-Mallison

risk of climate change. These strategies will Updated by:

share of the growth in CO2 emissions need to be implemented by both OECD and ZM GRAPHICS • 214-906-4162 • [email protected] non-OECD countries.

(c) 2009, ZM Graphics Inc.

Usage: Unlimited within ExxonMobil

through 2030. This is not only because it is the fastest-growing demand sector, but also

The outlook for energy-related CO2 emissions

because it is the one that relies most heavily

is linked directly to the types and amounts of

on coal.

energy required around the world. By 2030, global CO2 emissions are likely to be about 25 percent higher than they were in 2005. While this is a significant increase, it is substantially lower than the projected growth in energy demand over the period. This positive development is the result of expected gains in efficiency, as well as a shift over time to a significantly lesscarbon-intensive energy mix – mainly natural gas, nuclear and wind gaining

30

exxonmobil.com

2030

Gas 3123 3086 3060 3079 3302 3400 3457 3622 3770 3974 4020 4169 4153 4211 4230 4368 4580 4667 4703 4856 4970 5004 5147

File name: 30A XOMEO-DemandCO2.ai over the coming decades must incorporate

2005

1/1/80 1/1/81 1/1/82 1/1/83 1/1/84 1/1/85 1/1/86 1/1/87 1/1/88 1/1/89 1/1/90 1/1/91 1/1/92 1/1/93 1/1/94 1/1/95 1/1/96 1/1/97 1/1/98 1/1/99 1/1/00 1/1/01 1/1/02

2030

Oil 8566 8223 7982 7922 8000 7961 8185 8298 8574 8676 8787 8805 8859 8850 8925 9029 9215 9357 9460 9614 9636 9700 9740

2005

Coal 6923 6941 6966 7145 7446 7677 7736 8084 8344 8467 8527 8463 8315 8325 8381 8719 8870 8844 8799 8639 8883 8948 9149

0 1980

Global CO2 emissions will rise by

0.9 percent a year through 2030, with emissions growing fastest in the power-generation sector.

Options for

carbon policy

ExxonMobil believes that the broad objective of actions

encourages companies to invest in advanced technologies,

to address climate change should be to reduce the risk of

and provides a clear incentive for all consumers to increase

serious impacts on society and the environment, while not

efficiency and reduce emissions.

harming the contribution of energy to economic development and expanded prosperity around the world.

• A carbon tax avoids the costs and complexity of having to build a new market for emissions allowances or the need

As a company with 125 years of experience developing the

for new layers of regulators and administrators to manage

technology and infrastructure that delivers the world’s energy,

this market. It also does not open up significant opportunities

we believe we have a unique perspective on what types

for market manipulation, or require complex and costly

of conditions are necessary to successfully tackle such a

compliance and enforcement systems.

complex global energy challenge. • A carbon tax can be made revenue-neutral. Returning Above all, companies, consumers and investors will need a

the tax revenue to consumers through reductions in other

market environment that provides clear signals to encourage

taxes – payroll taxes or a simple dividend – reduces the

sensible and broad-based investment in the two most

burden on the economy, and ensures that government

powerful emissions-fighting tools: improvements to energy

policy is specifically focused on reducing emissions, not on

efficiency and the expanded use of lower-carbon fuels such

becoming a revenue stream for other purposes.

as natural gas. Continued progress on these fronts will require trillions of dollars in new investment, and steadfast work on

• Because global participation is so important to controlling

the creation of new technologies.

emissions, a carbon tax may be a more viable framework for engaging participation by other nations.

Some governments are considering policies that would impose a “cost” on CO2 emissions. In these cases,

As The Outlook for Energy shows, curbing greenhouse gas

ExxonMobil believes that a revenue-neutral carbon tax

emissions while also meeting rising energy demand will

has many advantages over a cap-and-trade system in terms

require a tremendous global effort, sustained over decades.

of achieving our society’s shared goal of reducing emissions

Compared with a cap-and-trade system, a carbon tax – by being

over the long term:

predictable, transparent, and comparatively simple to understand and implement – is a more effective approach for creating the

• A carbon tax can create a clear and uniform cost for

conditions necessary to achieve emissions-reduction goals.

emissions in all economic decisions. This price stability The Outlook for Energy: A View to 2030

31

CO2 emissions

CO2 emissions CO2 emissions

emissions per capita

Billion Tons

Tons per Person

40

12

emissions per GDP

Tons per Thousand Dollars of GDP in 2005 Dollars 2.0

OECD

10

Non-OECD

30

1.5 8

Non-OECD 20

1.0

6

4

Non-OECD

10

0.5

OECD

2

OECD 0 1980

2005

2030

0

2005

2030

2005

2030

0

Reducing emissions is a global priority. Yet

higher per-capita energy use in that country

because different countries are at different

group. By 2030, this gap shrinks, but remains

Please check units stages in their economic development,

CO2 emissions patterns through 2030 vary XOM Energy Outlook greatly between OECD and non-OECD For: GCG

country groups. Pat Gabriel / Brian Wilburn 817-332-4600

significant – at about two and a half times higher.

Data as of 10/28/2009 OECD Non OECD

"2005' 11.26 2.7

"2030" 8.76 3.41

When emissions are measured per unit of

32A XOMEO-CO2Emissions.aieconomic output, however, OECD nations Placed file(s): None Growth in CO2 emissions through 2030 have much lower levels. This is because For page: 32 Last updated: 12/07/2009 will be dominated by China, India and the developed nations have relatively productive Updated by: Carol Zuber-Mallison

2005

2030

2005

2030

Data as of 10/28/2009 OECD Non OECD

"2005" 0.4083 1.5554

"2030" 0.2159 0.7719

File name:

other non-OECD countries. Non-OECD economies and are less energy-intensive. By ZM GRAPHICS • 214-906-4162 • [email protected] (c) 2009, ZM Graphics Inc.

Non-OECD countries account for all of the CO2 emissions growth through 2030,

emissions surpassed OECD emissions in

2030, this gap also shrinks, although OECD

Usage: Unlimited within ExxonMobil 2004; by 2030, non-OECD countries will

yet their per-capita emissions remain far

nations remain far less energy-intensive than

lower than the OECD’s.

account for two-thirds of the global total.

non-OECD countries.

Meanwhile, OECD emissions will decline by about 15 percent, and by 2030 will be down to 1980 levels. When comparing the CO2 emissions of OECD and non-OECD countries, several measures can be used – producing very different results. On a per-capita basis, 2005 emissions in the OECD were about four times that of non-OECD countries, consistent with the

32

exxonmobil.com

OECD transitions to lower emissions

OECD transitions to lower emissions change in CO2 emissions

improving energy efficiency and CO2 emissions

Billion Tons Energy per GDP 12

2

Millions of BTUs per Thousand Dollars of GDP 10

1

8

1980

Increasing Efficiency

3

6

0

–1

4

–2

2

–3

0

2005 2030

Reducing CO2 Content 1980 – 2005

2005 – 2030

0

20

40

60

CO2 Content Tons of CO2 per Million BTUs

As a result of ongoing efficiency improvements

and power homes and businesses. Another

and a switch to less-carbon-intensive fuels

is reducing CO 2 intensity – choosing fuels

such as natural gas, CO2 emissions in the

that have lower CO 2 emissions.

80

OECD appear to have already peaked and XOMlower Energy Outlook are set to trend through 2030. For: GCG Pat Gabriel / Brian Wilburn 817-332-4600

Absolute

Data2005, as of 10/28/2009 From 1980 to OECD2134 energy usage "1980-2005"

"2005-2030" became both more efficient-2064 and less carbon-

File name: 33Ain XOMEO-ToLowerEmissions.ai emissions the OECD rose CO intensive. 2

by about 2 Placed billionfile(s): tonsNone from 1980 to 2005. For page:

Through 2030, we see this positive

trend continuing. Beyond 2030, further gains

33 Last updated: 12/07/2009 are likely as OECD countries continue to Carol Zuber-Mallison

But from 2005 to 2030, we expect them Updated by:

to fall by about 2 billion •tons, and by 2030 pursue efficiency and shift to less-carbonZM GRAPHICS 214-906-4162 • [email protected] (c) 2009, ZM Graphics Inc.

be back to about 1980 levels. This is a Usage: Unlimited within ExxonMobil

noteworthy achievement considering that

intensive fuels to help mitigate risks associated with CO2 emissions.

OECD economic output will have tripled over the period and population will have grown by about 30 percent. This proves it is possible to achieve economic growth and also reduce the impact of energy use on the environment. How has this progress been achieved? To curb CO 2 emissions and still meet rising energy demand, we have two main tools. One is improving energy efficiency – doing the same or more with less energy by employing advanced technologies and making smart choices about how we use energy to fuel vehicles, generate electricity

The Outlook for Energy: A View to 2030

33

Integrated energy solutions

34

exxonmobil.com

By 2030, there will be more than 1 billion additional people on the earth – in total, close to 8 billion people, all seeking better living standards. Economic expansion will be key to reducing poverty and improving health and prosperity, and we expect developing countries to expand their economies rapidly toward that end. This will require reliable and affordable energy, driving demand up by close to 35 percent versus 2005. At the same time, there is an ongoing need to protect the environment for future generations. These interlocking challenges require an integrated set of solutions. No single source of energy, sector of the economy or segment of society can solve all of these challenges. In our view, there are three key elements related to energy: • Accelerating gains in energy efficiency, which

conserves supplies, minimizes energy costs and



reduces the growth rate of both energy demand



and emissions

• Expanding the availability of reliable and affordable

energy supplies

• Developing and deploying technology to help

mitigate the growth of emissions associated



with energy use.

We believe it is prudent to pursue strategies that address the long-term risks associated with rising emissions, while keeping in mind the central importance of energy to the economies of the world. In this light, it is essential to consider and implement policies with the lowest overall cost to society. This requires economy-wide, predictable and transparent costs to shape business and consumer plans and investments. Global participation is also critical to reducing costs and risks. We must pursue each of these three elements with vigor if we are to meet our global energy and environmental challenges. Technology will, as it has in previous decades, continue to play a critical role in enabling all three of these areas.

The Outlook for Energy: A View to 2030

35

The Outlook for Energy through 2030 – key findings Demand Economic recovery and growth, coupled with rising

• The most important “fuel” of all is energy efficiency.

populations and living standards, will push energy demand



The energy saved by improved efficiency through 2030 is

up by 1.2 percent a year on average through 2030.



larger than from any other single source, including oil.

• By 2030, global energy demand will be almost 35 percent

Emissions



higher than in 2005. This assumes significant gains in

Global CO 2 emissions will rise by an average 0.9 percent a



energy efficiency. Without efficiency improvements,

year – a significant increase but substantially slower than



demand in 2030 could be about 95 percent higher.

the pace of energy-demand growth because of improved efficiency and a shift toward lower-carbon fuels.

• All the growth in demand through 2030 occurs in non

OECD countries, where economies are growing most

• Non-OECD countries account for all of the CO 2 emissions



rapidly. Non-OECD energy demand rises by more than



growth through 2030, yet their per-capita emissions



60 percent; demand in OECD countries declines



remain far lower than the OECD’s.



slightly even as their economies expand. • CO 2 emissions in the United States and other OECD

• Power generation is the largest and fastest-growing



countries are declining, even as their populations and



sector. By 2030, power generation will account for



economies grow; by 2030, OECD emissions will be



40 percent of all energy demand.



approaching 1980 levels.

• Demand for transportation fuels continues to increase,

• Emissions grow fastest in the power-generation sector,



due largely to greater use of heavy-duty vehicles (trucks



in part because it is the sector that relies most heavily



and buses). Demand for light-duty vehicles (cars and



on coal.



SUVs) actually plateaus and declines toward 2030. • Beyond 2030, further progress on emissions will require

Supply



more aggressive gains in efficiency and/or the use

To meet demand through 2030, we will need to expand all



of less-carbon-intensive fuels. New technologies will

economic energy sources. Demand will be strongest for fuels



be essential on both fronts.

that can help reduce CO2 emissions, such as natural gas. Improve efficiency. Expand energy supplies. Mitigate • Oil remains the largest energy source through 2030, but

emissions. Develop new technologies. Each of these



natural gas will move into second place ahead of coal. In

solutions will be needed to meet our interlocking energy



2030, these three fuels will meet close to 80 percent of

challenges through 2030 and beyond.



global energy needs. The Outlook for Energy is available on our Web site at

• Natural gas will be the fastest-growing major fuel.

By 2030, demand for natural gas will be more than



55 percent higher than in 2005. Technologies that



have unlocked “unconventional” gas will help satisfy



this demand.

• Nuclear and renewable fuels will see strong growth,

particularly in the power-generation sector. By 2030,



about 40 percent of the world’s electricity will be



generated by nuclear and renewable fuels.

36

exxonmobil.com

www.exxonmobil.com.

Glossary ExxonMobil’s Outlook for Energy contains global projections for the period 2005-2030. In the Outlook, we refer to standard units for the measurement of energy: BCFD. Billion cubic feet per day. This is used to measure volumes of natural gas. One BCFD of natural gas can heat approximately 5 million homes in the U.S. for one year. Six BCFD of natural gas is equivalent to about 1 MBDOE. BTU. British Thermal Unit. A BTU is a standard unit of energy that can be used to measure any type of energy source. It takes approximately 400,000 BTUs per day to run the average North American household. Gigawatt (GW). A unit of electric power, a gigawatt is equal to 1 billion watts, or 1,000 megawatts. A 1-GW power plant can meet the electricity demand of approximately 500,000 homes in the U.S. MBDOE. Million barrels per day of oil-equivalent. This term provides a standardized unit of measure for different types of energy sources (oil, gas, coal, etc.) based on energy content relative to a typical barrel of oil. One MBDOE is enough energy to fuel about 3 percent of the vehicles on the world’s roads today.

The Outlook for Energy: A View to 2030

37

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