and the U.S.S.R. has natural gas been consumed on a large scale for some decades. Europe has switched from coal gas to natural gas only in the last few years; in fact this switch, made possible by large discoveries in and around the North Sea, has been of great help in coping with higher oil prices.
The great oil discoveries of the 1960s in the Middle East and elsewhere were often accompanied by gas discoveries, but the oil has generally been developed first. Even where gas is found in association with oil, it is often flared or reinjected until the necessary facilities for using the gas have been built. Gas transportation over long distances, whether by pipeline or by tanker (after liquefaction) calls for massive investments extending over 10 years or more. Most of these investments are still in the planning stage; by the mid-1980s they may lead to significant international trade in gas. In some cases, such as the gas found in two areas of the Canadian Arctic, proved reserves are not yet large enough to justify the building of pipelines, so these discoveries will become reserves only if either still more is proved or the gas price rises further, assuming environmental and native-claims problems can be overcome. Even greater uncertainty surrounds “unconventional” gas, such as that in coal seams and geopressured brines.
The preponderance of oil in world energy consumption calls for a more detailed analysis. Table 10–6 summarizes the history from 1948 to the present. It shows that proved reserves increased nearly tenfold over this period, despite large and growing consumption. Reserves were 68 billion barrels in 1948; 327 billion barrels were produced in the 30 years up to 1978, yet 646 billion barrels remained. This implies that 904 billion barrels were added to proved reserves. Clearly any calculation as to the date when oil will run out is meaningless unless new discoveries are taken into account.
There is no indication in the table that additions to proved reserves are slowing down;5 the additions in the most recent 10-yr period shown were nearly as large as those in the preceding 20 years taken together. It is true that the largest additions have been concentrated in a few areas, especially in the Middle East, Africa, and the communist countries. Even for the United States, however, the historical picture is less bleak than it is often made out to be; in 1948 U.S. proved reserves were equivalent to about 11 years’ current production, and now they are equivalent to about 10 years’. U.S. oil consumption, however, is nearly 3 times that of 30 years ago while production has increased much less. The United States in consequence has changed from a small exporter to a large importer.