 To today's energy seminar, which is in fact a panel discussion on a topic that seemed timely a week ago And perhaps you tell me even more timely today given the events that unfolded last week and the topic of the panel is climate-wise choices on a world of oil abundance and To introduce the panel we have our own very excellent Professor of energy resources Engineering in the school of earth Adam Bratt Adam. All right. Thanks John appreciate it Yeah, so we've got a we've got a panel discussion today. It should be interesting and fun Here today, we've we've actually got all the main PIs on this project, which is a nice Too infrequent chance for us all to get together. So you guys get the full compliment here on the on the Far end we have John Kumi who was affiliated with the Steyr Taylor Center here at Stanford and now with Earth system science and school of earth sciences Jewel Bergerson is next. She's at the Department of Chemical and Petroleum Engineering at the University of Calgary and is an expert on lifecycle assessment of fuel processes and then Deborah Gordon Next to me here has been leading this project and really spearheading a lot of the Fundraising and outreach. She's the director of the energy program at the Carnegie Endowment for International Peace And so she's really been the glue and the and the sort of Fuel for this project to move forward so to speak In addition a whole bunch of graduate students and researchers have been involved Three at least three of which are in the audience right now Stanford students But a number of also junior research fellows at the Carnegie Endowment And graduate students at the University of Calgary have been involved as well So we certainly want to want to thank them I'm gonna talk for about 10 to 15 minutes to give some sort of context and general results Debbie is then gonna walk through some uses of the web tool one of the cool parts about this project is that we've developed a user-friendly very sort of interactive web tool that allows people to explore These issues from the comfort of their home so Debbie will Will lead us to that and then we'll have hopefully about a half hour of Panel discussion John will moderate we'll try to move to audience comments earlier rather than later To get as much feedback and interaction as possible. Okay, so that's the plan Okay, so so oil has been having a tumultuous time over the last decade Price has started low. They got higher. They got even higher still And recently in the last year and a half to two years they've crashed back down to inflation adjusted lows At least some of this can be laid at the feet of the commercialization of high-volume hydraulic fracturing and horizontal drilling hydraulic fracturing It has existed for a long time, but this new Development was really almost a qualitative shift in the type of resource that could be accessed Opened up huge volumes particularly in North America To exploitation. This has caused a production shift From the Middle East and former Soviet Union to North America and has actually precipitated really amazing Reversal in the United States at least were 40 years of oil production declines were almost Completely reversed in the space of five years At the same time pressures grow from outside fuel economy regulations not just in the US but internationally have been made more stringent Electric vehicles certainly threatened. They're still small, but on the horizon You know, maybe this is a potential competitor for oil and climate concerns have certainly led to development and subsidies for alternative fuels Things like ethanol advanced cellulosic technologies But for the time being oil still remains strategically important and worth studying so You know one big picture framing question is how much oil will we actually need so this is Data from about 150 different countries around the world production of oil from 1900 To the present here in each each country is a band We can plot on top of that Projections for the future so my my post doc Muhammad was working on this He's in the audience. I believe we correct collected every projection from the IPCC 2000 scenarios That that basically met a screen to where they're still seem to be valid with the historical Sort of transit have happened since the year 2000 the brand-new set of scenarios from 2016 Every oil company projection mostly from the major oil companies that we can find those typically go to mid-century as well as government organizations such as OPEC IEA EIA etc. So you can see these make this whole sort of forest Lots of people have ideas about what the future are. They don't necessarily the line okay one way to to make sense of this sort of noisy pictures to actually accumulate and cumul cumulating these Consumption volumes gives us cumulative oil consumption in billion barrels and really smooth this historical trend And actually gives us a nice envelope of futures here. So all these messy all this messiness here Arranges more tidily A pretty interesting thing we've used about 1300 billion barrels to date historically since the start of the industrial revolution and Consumption even in the most optimistic scenarios and we can talk about whether IPCC has scenarios that are really optimistic enough But even in the most optimistic scenarios, we're consuming about another trillion barrels Up to potentially five five trillion barrels Okay So how much oil do we actually have so it's useful to plot against this is the consumption side Here's here's the the availability. This is conventional oil resources already consumed is hashed here So this is most of that historical consumption These are current reserves from BP and then three estimates of Additional technically recoverable resources to find probabilistically from the USGS So this is the low estimate. We're 95% likely to exceed that. This is a very high estimate We're only 5% likely to exceed that this includes reserve growth of existing fields plus undiscovered oil assessed last in 2012 by USGS so we actually have a lot of Conventional oil left to be consumed in In addition though, we've we've got what's called heavy oil. So heavy oil and bitumen. I've graphed together here These are resources that are very dense and viscous difficult to extract and Refine a bit available in large quantities already consumed is small. Here's reserves and then three estimates of recovery factors at some indicative Or three estimates of technically a recoverable at some indicative recovery factors That's been well known these resources have been known for centuries in some cases And are largely being produced in Canada and Venezuela With additional production in California The new entrant though is is light-tight oil light-tight oil has only been produced really in commercial volumes for the last five to ten years So very small amount of cumulative production and Reserves are classified inconsistently and unclearly at this point. However The US Energy Information Administration has released a global report suggesting that global resources could be 400 billion barrels Okay What's really interesting though is you dig into the appendix of this report and you see that that actually is Assuming a 5% recovery factor on an 8 trillion barrel resource in place There's been upwards of 30 to 40 papers published in the last two years in Society of Petroleum Engineers literature About increasing the recovery factors of these tight oil resources and some suggest that you can go above 50% So if we take this 5% recovery factor to 15 or 30% this adds this large increment of oil here All this is to say that it's not clear to me at this point why folks are concerned About availability of oil resources. It looks like between additional technically recoverable conventional oil plus Heavy oil which we know how to extract plus tight oil which we we know how to do enhanced recovery on or at least we're starting down that path Looks like we have a lot of oil to give some context for this EOG resources out of Texas just released Some initial results of enhanced recovery on Eagleford shale They think they can increase per well recovery by 40 to 70 percent at an incremental cost of $6 a barrel Using enhanced recovery. So taking this 5% to 10% or 15% and it's likely we can get more So there's a lot of oil out there if oils are abundant. How do we choose what sort of? Metrics do we use? We think that oil climate impacts should affect this choice because these impacts are highly variable We've undertaken a multi-year effort, which we call the oil climate index to understand oil emissions Debbie has really led this In the current incarnation we have 75 major global fields which represent greater than 25% of global production Current production. So these are very large globally important fields on average We then use three open-source academic models to estimate emissions from these fields And we created an interactive web version which Debbie will walk you through see here An important facet of this work is that we take what we call a barrel forward approach Traditional life cycle assessment of which jewel and I have published many typically take a more consumer oriented Product backward approach where you start with say a leader of gasoline And you work all the way up the supply chain and count all the upstream emissions associated with that fuel So this can answer questions like which fuel is best how much better is my EV per mile of these sorts of things This is the traditional product or consumer oriented a life cycle approach instead in the OCI We take one barrel of crude in the ground and work it forward and count all the downstream emissions associated with it The numbers here are more relevant to producers and governments and really speak a little bit more to the carbon risk Associated with different resources with the embedded carbon and a barrel How does this project raise or lower my sort of portfolio carbon risk? Okay, so this this OCI approach is more relevant to somebody who's developing the resource This is maybe more relevant for a consumer trying to make a good choice. Okay, so there's a really two different perspectives on the same problem How do we do this? We used a set of three open-source models. We'll talk about two For upstream we use the oil production greenhouse gas emissions estimator This is a tool we've developed Stanford for the last five years or so it models all upstream greenhouse gas sources Using field-specific engineering models for things like lifting compression surface processing Re-injection this kind of stuff open source completely accessible easy to download lots of people are using it all over And it's and it's really developed in this in this open source methodology and I'll note that for the 75 fields We've actually made public every data input to the model so anyone can recreate their results Next for the refinery model we use a model called prelim This is Jules model from her group at Calgary. It's the petroleum refinery lifecycle inventory model Which models using three possible overall refinery configurations and like a web in detailed I refinery flow paths models all the the refinery greenhouse gas sources Associated with producing an oil and it uses crude or crude specific properties API gravities cut points Properties of fractions to estimate both the type of refinery that will likely be sent to most profitably sent to as well as the emissions associated with each processing unit that the crude goes through Okay, and so the emissions from these processing units are a function of the crude properties the volumes that go through each processing unit Etc. So here are just some quick results from the per barrel approach You're not meant to see the anything Here except the sort of the general shape of this Debbie will show the interactive version of this curve But you'll know we've ranked order them largest the smallest and from the smallest emissions here To the largest here. There's about a 60% increase from under half a ton per barrel To three almost three quarters of a ton per barrel This is quite a bit larger than the increment associated with the product backward approaches Okay, and this is for a variety of reasons that we'll we'll talk about there go later But this fairly significant increase so it really matters if we're picking our barrels from here Or here if we think we're going to consume a trillion more of them. This matters at very large scale So why might we have a larger spread in our sorts of studies? One of the interesting things that the drivers of emissions can be synergistic Heavy oil is difficult to extract often requires steam injections. It's challenging to refine So requires excess hydrogen And results in a higher carbon slate of final products more heavy fuels more residuals more petroleum coke When you add all these up and trace the barrel down through the supply chain You see a larger impact than just working from say a liter of diesel backward Oil field age can strongly affect emissions from conventional fields as more and more water is produced fields get increasingly monetarily expensive to run but also energetically a lot of pumping energy and processing energy For what can be a small amount of oil. That's really how oil runs out in a conventional field Enhanced recovery can be energy intensive with quite significant separation Re-injection and other processing emissions We then use this to generate a probabilistic view of these three same three classes of fields that were on the last slide conventional heavy oil embitterment and light tight oil and Using in this case we have 59 conventional crews 11 heavy oil crews and five light oil crews We can see probabilistically the distribution or in kilograms of CO2 per barrel Some interesting things here the the field distributions are sort of the default distributions And you can see the heavy oil and bitumen really stand out here. There's of course some overlap But the body of the distribution is higher By something like 100 to 200 kilograms per barrel We also see here that the shift between production and refining and final fuel emissions is different in these three classes of resources We can also see in these in these light blue Non-shaded distributions some mitigation options So for example, we take flaring from conventional oil resources and we set the flaring rate equal to the best observed practices in our data set We can see a shift to the left removing some of these high emitters This is even more the case in the case of light tight oil We're see a pretty significant shift because some of these regions in the Eagleford and Bakken that we model have quite high flaring rates For heavy oil and bitumen the mitigation opportunity is different and this is to avoid burning the pet coke or the residual Solid material that comes off the bottom of the barrel. And so by doing that you can get something that looks like a hundred kilograms per barrel shift in that distribution Which is pretty significant Right now about I would say something on order half of Pet coke from the oil sands is burnt mostly Shipped away from the United States refineries almost all the pet coke from California heavy oil production ends up being shipped abroad and burnt So if we can if we can address that that's a it's an obvious opportunity So take away points and then and then we'll let Debbie walk you through the web tool. There's a lot of oil available If you if you don't think conventional oil is enough, there's a lot of heavy oil and bitumen There's a lot of light tight oil can strongly augment conventional oil each oil resource has a unique impact profile depends on the operating characteristics and lots of other chemistry of the fuel But heavy oil heavy oil and bitumen resources tend to be higher light tight oil are lower Particularly if you control flaring they look better than conventional oils There's a bunch of obvious mitigation options that exist such as minimizing flaring and avoiding pet coke consumption The an interesting opportunity here with pet coke is that it's a very low value fuel And so the producers only forgo a relatively small Drop in revenues for a relatively significant carbon reduction Okay So we're going to load up the the web tool here and Debbie can show you All the things we can explore here Okay Let's try to make this brighter here Yeah, let's see if I can turn some lights down here So well Adam just on can you hear me? Yeah So just to put kind of a geographic face on all that Adam was discussing Early on in this project We agreed that there are big differences and we were shocked at how large the differences in in greenhouse gas emissions Were between the oils that we modeled in the first phase of the OCI Which was only 30 oils and 5% of global production that those differences between these oils emissions were large and large enough to matter But what was interesting in going to the second phase and going to 75 global oils is Adam said about 25% of global production Was to try to put a face on the globe and what turns out is that there really is no country that owns good or bad oil There's a huge geographic distribution of these oils around the world There's even more oil in the ground to manage and really any country can manage their oil better or worse depending on what their options are so I was going to just zero in the Dots here are flaring which we were able I need two hands to do this Sorry there. I just want to show you because this was worked on very hard by one of Adam's graduate students So this is zeroing in on Alaska North slope and the dots there are some flaring. It's not a very highly flared field and But the boundary is interesting because that's the boundary of the oil play and what you can start to see is you can look From space which is where our satellite data comes from for the flaring But then you can look on the ground to where that oil play is Geologically and you could start to tell a lot about what's going on from under the ground and from space at the same time Which is a really kind of the perfect way to think about oil is something that's very deep in something that needs to be managed from afar as well Then just in terms of Okay, Adam where'd it go? These Adams so just to put a face on the what Adam was just showing you but in a more of a fixed route This is the sum where it's upstream emissions or the dark midstream is the middle and downstream is to the right of These different oils so not only are you talking about and comparing the total emissions of these oils You're really starting to get smart about where the emissions reside for an oil So in other words, where is the most challenging part of a barrel of oil? Is it in its production? Is it in its refining and when it's in its downstream? What are the products that? Will actually lead to its different emissions so there you can see and you can swap these around in terms of greenhouse gas emissions per Megajoule of product you can actually swap them around I think this is a really interesting one if you think that we knew, you know types of oil and they were pretty Homogeneous you can see here different types of oil from conventional to ultra deep to Watery to depleted to ultralight There's a lot of variants and emissions even when you're talking about a certain type of oil that you thought was pretty Standardized these barrels are really mixing themselves up and then I wanted to show you here just to give a sense of An oil that Adam was talking about There it is So this is Texas Eagleford, which is an interesting one This is the a very complex complex field down in Texas that happens to be very highly flared These data come from NOAA they're from a satellite that NASA operates so they're their real-time data in terms of flaring and What's interesting is if you just compare as it's currently Operating to what could happen if this gas was well managed if you notice that top bar there It went from its current operations here With 574 kilograms per barrel of co2 equivalent emissions And if you really do operate this field responsibly you end up with a 93 percent reduction in upstream emissions and You're a 27 percent reduction in overall emissions for selling the gas for doing something that could be economic But a lot of these considerations I will add are things that the oil industry doesn't always normally think to do first Because their goal is to make money on producing this oil and if you put the artifact of climate over the oil sector It's a newer realization. It's something that the oil industry has not had a long time to really put their minds to So we've found out from folks in industry responding to this tool is it's helping them learn how to manage their oil better and A lot of folks in industry need to be taught how to think about a social consequence like climate change And then the last thing I was just going to show you so we can go on is just to show you the capacity for innovation in this field And first to say here This is you could plot these oils into different ways and learn about them But what's interesting about this is that the default plot here is emissions total emissions by API gravity of the oil and API gravity of the oil up until as Conventionals have been depleting told you a lot of what you needed to know about the oil the economic value of the oil How you would refine the oil how you would handle the oil safely? In many parts of the world the gravity was defined by that part of the world. So that's why there is an American Petroleum Institute API gravity was a very powerful Characteristic of oil, but when it comes to greenhouse gas emissions, there's not a correlation So it doesn't it tells us a lot about what oil had been and how to manage it But when you think about climate impacts, it doesn't tell us enough And I think that's a really big problem for the oil industry right now because they don't really have necessarily the data at their fingertips It's buried in their industry to help them manage these oils better But there's a lot of innovation that can take place in these oils And I'll just show you a couple that Adam was was mentioning and you could play with this So if you as Adam was saying and look at the curve and start to watch some of these bubbles go down So if you don't flare you end up with emissions reductions If you don't burn the in the heavy oils the pet coke You see a reduction emissions if you use concentrated solar to generate your steam You see reductions in emissions if you manage your associated water really really well you see reductions in emissions and if you use the refinery fuel gas LPG in your operations you see reductions You can actually see the oil industry bending the curve on its emissions Which on face value might might sound like compared to say renewables not very much, but a renewables aren't a great replacement for liquid fuels, but also be when you talk about trillions of barrels It adds up very very quickly in terms of emissions reductions. So you can play with this. It's open source there's materials here that we've left and feel free to take that at the end and Open it to you Okay, so I want to ask just first one technical question and then one Institutional question and then we'll move to audience questions. The technical question relates to uncertainty In each of the three parts of the model the upstream the midstream and the transportation downstream side there are Uncertainties that affect those results and I was hoping each of you could talk about the biggest Fackers in the uncertainty of the results for those sectors So extraction is first and we've written a couple papers looking at uncertainty analysis and our model my postdoc Mohammed is currently working on a Very improved version of the model, which will include as a default Money car will uncertainty assessment. I would say at this point the largest uncertainty has to do with missing data So what we call the front sheet of the model has about 50 characteristics of the oil field its depth its pressure How many wells are producing? What's the well bore diameter lots of is the gas re-injected as the gas sold these sorts of things? Often we're missing these data in particular for global crutes. And so that's probably the biggest source of uncertainty right now It's the lack of transparency around global oil sector activities it's quite hard to get data on Oil production operations, especially in many of the developing countries and former Soviet Union regions and So I would say at this point the biggest challenge in fact is is that we don't have all the data that we'd like to have Yeah, I work on the refining side and similarly the data availability is the biggest issue So we take assay information about the characteristics of the crude itself and then process that through the refinery There are quite a number of assays that are published online from oil companies But we're still missing some really critical ones. So some of the The the tight oils like the Eagleford in the Bakken in the US. We have no public assays to actually characterize those crudes Or the variety of products that are coming from from those those assets. And so that is a really big problem I think the other side though is also the variability So how you choose to process those crudes what types of refineries you actually put them through and the types of products that you produce Creates a quite a bit of variability in the emissions on the refining side as well So I'd say there there are data issues, but there's also quite a bit of variability that you know We're increasingly being able to capture still limited by the data though and Carnegie did the op-am the product module and Counter to maybe a lot of perception the Transportation a product around the world despite the fact that products do really travel the globe In in often tankers that those emissions are actually relatively small Obviously on the downstream the most the largest emissions come from consuming the product so The only thing I'll say about the transport which is something that's very visible and of course after the Keystone Pipeline and the Dakota access And a lot of infrastructure Conversations at least that we've been happening here It's really the last mile in terms of moving product and trucks That become a really dominant factor in what the emissions will bear in terms of the downstream emissions and then in terms of the combustion emissions which Up until now until we did the oil climate index There was always an assumption there were two assumptions that were all frustrating One was that all oil is gasoline or diesel like there was almost a one-to-one Relationship which it is not the case at all and it's different for different oils Some oils have a lot of gasoline associated them some have a lot of bunker fuel associated with them It's a very variable so a lot of that variability and uncertainty come from downstream in terms of how these oils are optimally or sub optimally in many cases around the world refined Because how much emissions come from the barrel that the slate of products have everything to do With how you actually turn them into product in the first place Great, okay, so the institutional question relates to the opportunity that Understanding the oil supply chain opens up because in the past when we had the product focus There was just an assumption that all that other stuff could somehow be averaged and Come up with a reasonable number But now we have this picture of the supply chain and I think that opens up opportunities for institutions like oil companies either nationally owned or in private oil companies to Differentiate themselves and so I was hoping each of you to the extent that you're comfortable sharing these anecdotes could talk about Conversations you've had with people in industry or in government who see an opportunity here for private sector and Government action to to move emissions lower in the oil sector Sure, so this has become really interesting to me that the Realizations here that oils are highly variable and how you manage them even introduces more differentiation between their greenhouse gas emissions it opens up a very natural thing for the oil industry which is competition very competitive industry and a competitive industry not the national oil companies, but the international oil companies a competitive industry that's very light on their Feet about whether they're involved in a certain asset class they trade easily It's very easy to get out of an asset and go into another asset to swap resources to get to get To go for a field that you decide not to develop There's a lot of decision-making that goes in there So we're starting to see a bit of a race to the top in terms of who's going to in a warming world Have that claim of having lower emitting oils and so companies have started to approach us in fact at Stanford Last year when we when we released the first phase of the OCI someone was there from Pemex I remember and they were very curious about what this all meant in terms of their oils and their national oil company Recently Adam and I are going to be going to Norway next month to talk to stat oil because they have all got a lot of questions About how they race to the top and they become the company with the lowest emitting oils All this is to say that this race to the top creates a lot of innovative capacity in this industry And that is a very good thing for an industry that's kind of over a hundred years old and can be a little bit stodgy at times Yeah, so just added what to what Debbie said this is this is really of interest to a number of the producers So we've been in contact with Someone from a Ramco Saudi Ramco. This is interesting They actually used our model with a with one of these proprietary global databases of you know Every oil field in the world and as it turns out Saudi Ramco if you run all these fields comes in And actually the other feel the other company mentioned was stat oil comes in way at the bottom Very prolific oil fields much less depleted than a lot of the fields in North America Quite easy to refine high quality crews And so if you look on a company by company basis, they said hey holy smokes We we come out looking pretty good. Let's own this Let's start to use this as a source of strategic advantage And so there's a lot of interest from that company in particular about trying to Understand this and I think that's a that's a Opens up a big opportunity as Debbie said as companies start to sort of own this and and and move forward and sort of stake a claim as A more climate friendly oil resource. I think that's going to carry increasing weight going forward regardless of what happens in the next four years or so And I'll just make a quick comment about innovation as well So looking across the supply chain for innovation opportunities Companies typically have a very good handle on the economics of those innovations and where they're going to see the economic value within their Portion of the supply chain, but understanding what the climate impacts of that are Across the entire supply chain is something that some companies don't necessarily have at hand and so using these types of tools to help inform those types of Decisions as well as the implications of different innovation is is another area that I've seen this be applied Okay, so for the first time there's visibility into the whole climate impact of the whole value chain and People even who don't own Everything from the production all the way to the the sales still will have some idea of what the total missions are and that's a new Thing yeah, so and I would note that it's it's it's not always straightforward What the best option is right so a big a big issue up in Canada has been on-site upgrading versus versus Shipping diluted heavy bitumen and there and there's back-and-forth arguments obviously about the economics But what which choice is better for the environment is actually a reasonably complicated question that The jewel in particular has been spending a lot of time on yeah And I was to say another thing Adam and I have spoken a lot about this that this really benefits something way beyond oil that if You really are considering these marginal oils and considering the count their emissions calculus You change the cost benefit results of electrification of the transport sector or biofuels Because if you're comparing those alternatives to average oil, which doesn't even exist as Adam was showing you that if you're comparing it to some sort of non-existent Minimalist past you're really undercounting the benefits of alternatives So a more honest full accounting of oils in their different states and the different options both economically and environmentally Really changes the face of alternatives in a very positive way and the focus on Marginal oils the ones that are more likely to be developed in response to changes in technology and prices Gives you a different answer than if you look at average oil And that's kind of the big picture takeaway from this work Is that when you just look you assume that oil is one thing or that oil products are one thing? You miss out on the potential for innovation throughout the supply chain and that turns out to be a big omission so With that I think we have about 15 more minutes and so I'd like to turn to audience Questions I would ask that if you ask a question Please first state your name tell us your institution and then ask a brief question So that as many people as possible can answer questions ask questions and we tend to want to get students first You're a lifelong student The index here's what I'm trying to grab my head around Let's say you had to feel one that is Producing everything very efficient no loss, but it produces a lot of that very heavy Very kind of it the others quite inefficient in everything down the line But it's producing lots of light products very little heavy products your index I would guess would show that the first one Was a worse oil because it has a more heavy product It may or may not depending on the numbers But it is that misleading given given that there's a supply and demand is going to be a market for both the light and the heavy products you sort of cook the books by mixing the product mix along with the Quality of the way this process. Yes. That's a very good question. I'll start on that so Have your oil have your heavier oils tend to have larger emissions They also tend to have more revenue of final product that's larger per barrel larger per barrel And so yeah, and really, you know barrel is a volumetric term what actually You know adds value or a carbon and hydrogen molecules and so density there actually increases your emissions and increases your value You can actually on the web tool change the index so it's per dollar a final product Produce for examples or per megajoule final product and we have the energy intensities plus Market values of some of these products and those could be quite different This can be quite different so per per unit of energy pet coke trades often is at a not even at coal It's it tends to be actually dirtier than coal higher sulfur higher metal content So it's actually even lower value per BT than coal and so the relative mix there can really affect You may get one ordering if it's per barrel one ordering per Per dollar I would say that the per barrel approach is interesting just because it's a more relevant factor for people interested in Thinking about ideas around stranded assets valuing the assets of a regulated region Portfolios of companies what they're invested in this sort of stuff So it's it's flipping in on its head it doesn't tell you everything maybe in some cases you'd want to look at a Final product oriented number like per liter of gasoline and that might tell you more But I do think the per barrel actually adds some New answer different perspective to the argument Yeah, and I'll just add that I think you get around the problem that you're thinking about cooking the books because we're not just talking About total emissions what you do is you look at the upstream and the midstream and the downstream components to those emissions And so the upstream and the midstream are going to be where your inefficiencies because those are operations in terms of energy in as Opposed to carbon out which is what the consumption side is so you can actually see for different oils Is this an oil that has 90% of its emissions of its emissions in consumption some oils only have 60% of their emissions and consumption of final product which says that there's a lot of room for improvement of how they actually Deal with that oil and moving into product so it opens up the door to understand your oil in terms of where its Individual challenges lie and I would know we've also we've also had a lot of discussions with with The folks about how to think about the pet coke market and that's a really interesting question So pretty large volumes of pet coke are being produced. It's a low-value product There's not really a central sort of WTI or Brent like clearing price for coke It's sold in kind of bilateral contracts in a more ad hoc fashion There's real questions about let's say we moved to oils that produce less pet coke what happens Is more coal simply mind and train in India You know this this is a question right so it it I think the way to think about as it kind of dumps a low-value low-cost source of You can think of it like coal but dirtier onto international markets And in many cases it's burned in poorly regulated Facilities very high sulfur content very high metals content. So even if we're being replaced by coal It may actually be a benefit But yeah, that's that's a very interesting question it deals with the interaction of of all these markets because the markets will control in the end What mix of of products are consumed? Quickly is the this is very much an attribution LCA so it's sort of a snapshot of individual pathways It's not necessarily a comparison of you know satisfying the demands of different products in a particular market But I think it's a really good jumping-off point to try and look at some of the macroeconomic Analysis that you could do and it provides information that could be used for that to say if you stopped producing one of these pathways What would the consequence be what how does the the market react to that and what are the consequences of that shift? That I think it's a jumping-off point for that analysis, but this is very much a static snapshot of individual pathways Okay, next question. Let's see if we find a student first Any student Sorry, sorry wait wait wait there's a student over here My name is Gracia But I would like to ask you imagine that you are now working to the for the government not in school so In U.S. and Canada you're working for the government and you want to Encourage oil companies to reduce emissions, but they reduce their emissions Like these topics take investment So how do you do it? If you tell me about taxes or regulations that could reduce attractiveness of oil projects School That's a very good question Debbie do you want to go first and I'll noodle on sure sure I mean I think that there's a lot of investment in infrastructure globally if you think about Had this tool been available and had the concern for climate become Paris happened 10 years earlier Then questions of the U.S. Refining infrastructure becoming very dominated by Cokers and heavy refining it might have been a very different conversation And had we found like tight or you know had light-tight oil happen earlier So sometimes it's a little chicken and egg with this industry, but you can use this tool had certain Awarenesses happened a little bit earlier. I think we would have had a whole different investment Direction then what we have right now the same question that I raised when I testified before Congress about lifting the crude oil Export ban I asked them with this tool in hand. Do you know what you're going to export? Do you know what carbon flows you're going to commit from lifting the ban on exporting crude oil? And it's a tool like this that could actually look at those oils moving elsewhere in terms of understanding that so you end up with Investment decisions on ports on pipelines on refineries I think that you need these kinds of questions if you're as the title of the talk is if you're going to consider oil in a warming world You need to be able to ask questions that compare these different oils and that's where government You know government Investment ends up becoming or governments actually give a lot of money if you're you know say in China right now What direction should China go which oils should they prepare to import? Should indeed be taking the US's pet coke I mean these are really important questions of climate change that I think happened without a tool like this under the veil They're very they're very opaque, and you can't see what's going on until it's usually too late Real quick, I mean there's a couple things going on one interesting thing is that oil has a very large value Per unit of carbon compared to other fuel sources because it's it's sold as essentially at this point in history a premium transport fuel in most markets So if you look at carbon taxes that will have very high impacts on Let's say the electricity generation sector $50 a ton would totally change the economics of your of your Of your electric grid would have quite small impacts Here right So this is this is one of the challenges in oil sector emissions is that It's not clear how to do this because it's not clear that a carbon tax would be Particularly effective at realistic levels, especially at current levels of carbon prices in California or in the EU carbon prices are definitely too low to have much effect on on oil resource investment You know that there are a couple examples of of Jurisdictions or regions using these types of numbers to to guide investment decisions And so one one example is California What's called the low carbon fuel standard as a regulation that aims to reduce the carbon intensity of transport fuels in California? And it's sort of sectioned off and carved out as its own regulation because of this issue of The ineffectiveness of a general carbon price and affecting transport futures and so in that regulation Crude oils of various types are scored and actually that's given sort of a statewide baseline value of carbon intensity that companies can Try and beat to obtain credits and so that kind of approach with a carbon price You know is perhaps the best way to incentivize Development, but you know there's actually a lot of international action going on That didn't necessarily require a carbon price so the Oman Petroleum development Oman has invested in what's the largest solar thermal power plant in the world is one gigawatt enormous solar thermal power plant to replace the use of gas and some of the heavy oil operations Which is one of the options we have there and that's not really carbon price driven That's value of gas and they have a great solar resource and this sort of thing, but I think there's a lot of examples Out there that are a bit one-off and it's unclear what the overall you know regulatory framework should be I'll just say quickly the Canadian example So in in the case of the oil sands in Alberta The industry was actually much further ahead than the government until recently so the government is moving forward with carbon pricing But the industry had already formed an alliance of companies where they're sharing IP to try and innovate and develop They were very cognizant of the challenges associated with the oil sands and things like that already So they're already moving in that direction and we've seen some Incremental benefits from that in terms of the innovation that's coming forward One of the things that the federal government recently did was fund Universities to try and look at basic science basic material science breakthroughs and things like that that are needed to actually Rethink the resource altogether. So can you get the energy out without the carbon? So these are longer term high-risk, but potentially high payoff Opportunities and so taking it back into the sort of university level research is another tactic Okay, so let's go to this perpetual student and then to that perpetual student Okay, so I have a statement and another question Statement is we cannot burn another four trillion barrels That's just fact We absolutely can but One third about of the 1.78 trillion barrels Okay, let's just Nevermind the question is Your gas management the leakage That's a season cloud of methane over Texas and Arkansas Are you taking that at the count as the emissions of? the oil Yes, so you are those are included. They're very uncertain We actually have a contract right now with the California Air Resources Board to dig into that tons of science ongoing We're doing some science here working with Rob Jackson It would say at this point we know way too little about about where the methane is coming from There's been a bunch of work over the last couple years Most of it focused on the on gas infrastructure rather than oil But yeah, there are some studies out there, but not nearly enough information you mentioned the satellite I think there's a lot of opportunity in the long run for methane sensing satellites to be a first Kind of global pass at where where methane is coming from to target. But yeah, that's very very good point We're working on it, you know every day And it can change a lot of the results It can change a lot of results because those are the small amounts of methane because the global warming potential you guys it's it'll It'll these numbers will will flip all around and and I'll just add that It's very sad, but in the oil the oil and gas industries often, you know Agglomerated you have them oil and gas the reality is summer oil summer gas and summer both The oil industry is much more willing to vent and flare their gas than the gas industry is and for many obvious reasons I mean gas is your business So mishaps really will be a gas problem But as a normal course of business gas is what you're trying to sell the oil industry sees gases in nuisance The oil industry doesn't want to deal with that gas They're getting a lot more value for their oil and we've even heard recently from some companies that with these low prices of oil It's a lot cheaper to vent than it is to flare Which is a big problem Your model should be going into the local governments that say here's what you need to regulate Definitely, I mean there's a lot of talk about regulating methane the the issue is going to be Doing it quickly enough and honestly enough and I agree with Adam. I think that satellite technology They're trying to get get EPA to be able to you know somehow pierce NASA's You know purview of satellites has been a bit challenging. I think for that agency But it's there and for drones too. It's a real issue and it's gonna be a growing issue I would say so I am told that we are out of time But I would ask this gentleman to come up and ask his question afterwards and then Thank you