Oil and Gas Supply Module of the National Energy Modeling System: Model Documentation 2018
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Oil and Gas Supply Module of the National Energy Modeling System: Model Documentation 2018 June 2018 Independent Statistics & Analysis U.S. Department of Energy www.eia.gov Washington, DC 20585 This report was prepared by the U.S. Energy Information Administration (EIA), the statistical and analytical agency within the U.S. Department of Energy. By law, EIA’s data, analyses, and forecasts are independent of approval by any other officer or employee of the United States Government. The views in this report therefore should not be construed as representing those of the Department of Energy or other Federal agencies. U.S. Energy Information Administration | NEMS Model Documentation 2018: Oil and Gas Supply Module i June 2018 Update Information This edition of the Oil and Gas Supply Module of the National Energy Modeling System: Model Documentation reflects changes made to the oil and gas supply module over the past couple of years for the Annual Energy Outlook. The major revisions to the previous version of documentation include: • Updated county-level estimates of ultimate recovery per well for tight and shale formations (Appendix 2.C) • Incorporated learning by doing in technology representation • Updated diminishing returns function • Updated assumptions for the announced/nonproducing offshore discoveries (Table 3-8) • Added Canadian Natural Gas Supply Submodule U.S. Energy Information Administration | NEMS Model Documentation 2018: Oil and Gas Supply Module ii June 2018 Table of Contents Update Information ...................................................................................................................................... ii 1. Introduction .............................................................................................................................................. 1 Model purpose ........................................................................................................................................ 2 Model structure ....................................................................................................................................... 5 2. Onshore Lower 48 Oil and Gas Supply Submodule................................................................................... 7 Introduction ............................................................................................................................................. 7 Model purpose ........................................................................................................................................ 7 Resources modeled ........................................................................................................................... 7 Processes modeled ............................................................................................................................ 9 Major enhancements ........................................................................................................................ 9 Model structure ..................................................................................................................................... 11 Overall system logic ........................................................................................................................ 11 Known fields .................................................................................................................................... 12 Economics ....................................................................................................................................... 14 Timing .............................................................................................................................................. 49 Project selection .............................................................................................................................. 51 Constraints ...................................................................................................................................... 57 Technology ...................................................................................................................................... 64 Appendix 2.A: Onshore Lower 48 Data Inventory ...................................................................................... 64 Appendix 2.B: Cost and Constraint Estimation ........................................................................................... 93 Appendix 2.C: Decline Curve Analysis ....................................................................................................... 163 Appendix 2.D: Representation of Power Plant and xTL Captured CO2 in EOR ......................................... 172 Modification of EOR project constraints in OGSM .............................................................................. 174 Integration of EMM into CO2 EOR process .......................................................................................... 175 Mathematical description of EMM-CTUS constraints ......................................................................... 175 Integration of LFMM into CO2 EOR process ........................................................................................ 176 Mathematical description of LFMM-CTUS constraints ........................................................................ 177 3. Offshore Oil and Gas Supply Submodule .............................................................................................. 179 Introduction ......................................................................................................................................... 179 Undiscovered fields component .......................................................................................................... 179 Discovered undeveloped fields component ........................................................................................ 195 U.S. Energy Information Administration | NEMS Model Documentation 2018: Oil and Gas Supply Module iii June 2018 Producing fields component ................................................................................................................ 197 Generation of supply curves ................................................................................................................ 199 Advanced technology impacts ............................................................................................................. 200 Appendix 3.A. Offshore data inventory ................................................................................................... 201 4. Alaska Oil and Gas Supply Submodule .................................................................................................. 211 AOGSS overview .................................................................................................................................. 211 Calculation of costs ...................................................................................................................... 213 Discounted cash flow analysis ............................................................................................................. 216 New field discovery .............................................................................................................................. 218 Development projects ......................................................................................................................... 220 Producing fields ................................................................................................................................... 221 Appendix 4.A. Alaskan Data Inventory ..................................................................................................... 224 5. Oil Shale Supply Submodule ................................................................................................................. 226 Oil shale facility cost and operating parameter assumptions ............................................................. 230 6. Canadian Natural Gas Supply Submodule............................................................................................. 241 Introduction ......................................................................................................................................... 241 Western Canada .................................................................................................................................. 241 Drilling determination ................................................................................................................... 242 Nonassociated natural gas production ......................................................................................... 242 Appendix 6.A. Canada data inventory ..................................................................................................... 244 Appendix A. Discounted Cash Flow Algorithm ......................................................................................... 246 Appendix B. Bibliography ......................................................................................................................... 259 Appendix C. Model Abstract .................................................................................................................... 273 Appendix D. Output Inventory ................................................................................................................. 277 U.S. Energy Information Administration | NEMS Model Documentation