Grupo de Economia da Energia

Posts Tagged ‘technology’

Exploration and production of oil and gas in deep waters: evolution and trends – Part III

In natural gas, oil on 02/01/2012 at 00:30

By Thales Viegas

The first two articles about E&P in deep waters (*) characterized this activity at the global and domestic levels. Aspects such as the importance and attractiveness of this business can be identified as factors that contributed to increase investments, offshore discoveries and production in deep waters.

This article will discuss the process of technological learning and investments in research and development (R&D) made by oil companies. The goal is to encourage attention about the emergence and consolidation of new technologies. It is also demonstrates that increased innovative efforts by oil companies indicates an increasing search for technological ability, in order to counterbalance rising costs.

However, the maturity of a set of technologies and their domain by agents is a process that requires practice and time. In this context, we have to analyze some limits and technological opportunities arose during the development of skills for operating in deep waters, especially in the case of Pre-salt. Continue lendo »

Pre-salt: an obstacle to renewable energy?

In oil, renewable energy on 28/11/2011 at 00:09

By Edmar de Almeida 

Recent accidents involving oil spillage in the Gulf of Mexico and now in the Campos Basin raise an issue on Pre-salt exploitation in Brazil: Would Brazil going through an irrelevant adventure with the imminence of substituting renewable energy sources by oil?

This question is linked to the idea that oil is a former energy and there is no worth to mobilize society’s resources in a business doomed to shrink and disappear quickly. This idea has no support nowadays.

Prediction studies of global energy matrix show oil and natural gas still prevailing in long-term horizon. According to the International Energy Agency, these energy sources, together with other fossil fuels, will account for 75% of global energy matrix in 2035, the most optimistic scenario for renewable energies.

This type of prediction is confirmed by other government agencies and major energy companies worldwide. We can say that oil and gas will keep a prominent role in the long transition to a decarbonized economy. Thus, Pre-salt is a significant comparative advantage for Brazil. Our country could take a leading role in the energy transition, not only because of its large endowment of oil and gas, but also because of its significant potential for renewable resources. Continue lendo »

The future of biofuels X: the two sugar rushes

In biofuels on 21/11/2011 at 00:30

By José Vitor Bomtempo

In the rush to develop new processes and products that will compose the bio-industry of the future, searching for suitable feedstocks is a strategic point, especially in the case of biotechnology-based processes. As some innovative projects try to overcome the original stage and make scale up to demonstration and commercial one, ensuring access to feedstocks becomes critical. For many of these processes, and probably for the most innovative ones, sugar is feedstock of choice.

As a consequence, a real sugar rush similar to gold rush for bioprocesses occurs. In fact, evidenced in recent months not only one but two sugar rushes: a more immediate and commercial / strategic nature one, in order to ensure the best sugar that exists today – the Brazilian sugarcane – and other one with technological nature to seek the plentiful sugar existing in plants in general (2/3 of the lignocellulosic material is composed of sugars: cellulose and hemicellulose). Continue lendo »

Exploration and production of oil and gas in deep waters: evolution and trends – Part II

In natural gas, oil on 24/10/2011 at 00:50

By Thales Viegas

Our last article concerning E&P in deep waters attempted to place this industry segment in the deepest part of Global Oil Industry (GOI). This approach aims to analyze the oil activities in Brazil carried out in great depths. It demonstrates the high rate of exploitation success and leadership of the country in regard to the greatest discoveries of the decade. It debates the virtuous circle on new discoveries. It considers the Brazilian remaining potential and high degree of attractiveness, in general, and the Pre-salt province, in particular. It highlights that the magnitude of reservoirs and quality of hydrocarbons found are relevant stimuli for international oil companies.

Pre-salt has been showing one of the largest oil structures in the world. In Brazil, Pre-salt pushed up the success rate in drilling wells. Table 1 shows the extraordinary success of the drilling in the Pre-salt, in the Lula field (former Tupi), in the Santos Basin. Pre-salt province’ success average is greater than world’s one. This indicates that the exploration risk in this environment has been low in the Pre-salt in relation to the alternatives around the world. By the early 2000s the national average was consistent with average rate of success in the world, which has ranged around 25%. Continue lendo »

The future of biofuels IX: The diversity of strategies and future of bio-economy – by comparing Shell, Braskem and Amyris

In biofuels on 05/09/2011 at 00:30

By José Vitor Bomtempo

In previous articles, we have studied the oil companies’ biofuels strategies. In particular, we discussed the Shell, BP, Total and Petrobras’ activities. The main conclusion from these analyzes is a diversity of view and approach to “biofuels” business.

In this article we will extend the discussion about the diversity of strategies that can be observed in the development of bio-economy, by comparing Shell, Braskem and Amyris. This comparison illustrates the remarkable variety of strategies for innovation and entrepreneurial initiatives that indicates the construction of the bio-products industry.

There are many ongoing projects worldwide involving technology-based start-up alongside companies established in different industries such as oil & gas, chemical, biotechnology, and agribusiness. How have companies been building their history in the new industry? Are these strategies converging or diverging? Continue lendo »

Exploration and production of oil and gas in deep waters: evolution and trends – Part I

In natural gas, oil on 15/08/2011 at 00:30

By Thales Viegas

The offshore exploration and production of hydrocarbons is not new. The first activities would have occurred even at the beginning of last century, in the Gulf of Mexico, USA. They were performed from the adaptation of equipment and onshore exploration techniques. Since then, many technology and operating changes in the oil and gas upstream have occurred. And then, many features previously considered inaccessible or uneconomical have become the object of interest and economically recoverable reserves.

This article will address the potential for discovering resources and the level of reserves in deep waters. Continue lendo »

What the impacts on the current revolution market of the shale gas?

In natural gas on 25/07/2011 at 00:15

By Edmar de Almeida 

The development of technologies for production of shale gas has been considered a revolution for business and economics of natural gas. Many agents and even the U.S. government believe that unlinking price of natural gas from price of oil in the United States is a structural phenomenon that reflects the new technological and geological context of the natural gas industry. There is a perception that the technological revolution of shale gas will affect permanently not only the U.S. gas industry, but also the global gas trade. Those believing this structural show the following arguments to support this view:

  • The current shale gas resources in the USA are equivalent to 3.5 times the volume of all proved reserves in the USA today. Moreover, the availability of shale gas resources is not restricted to USA. A recent survey conducted by Department of Energy (DOE) has pointed out the existence of large volumes of shale gas resources in 48 sedimentary basins in 32 countries, including Brazil, Argentina, Bolivia, Uruguay and Paraguay.
  • The technological learning process in the last 10 years has reduced dramatically the cost of producing shale gas. The main innovations were: i) reduction of the time for drilling wells, ii) improvement of horizontal drilling techniques, iii) improvement of geological knowledge in production areas, iv) development of hydraulic fracturing technology and standardization of equipment. These innovations have reduced production costs to less than US$ 3 per MMBtu, in the best producing areas. Continue lendo »

From fossil fuels to renewables: the hard energy transition

In energy on 18/07/2011 at 00:30

By Ronaldo Bicalho

To prepare an energy policy that manages the hard transition from a fossil fuel economy to a low carbon economy is not an easy task.

The massive replacement of fossil fuels by renewable energy sources involves significant technological, economic and institutional changes. These changes go beyond the energy sector and cover subjects related to a set of values associated with the crucial role of energy in economic development and social welfare and relationship with natural resources and environment derived precisely from this centrality.

The compatibility between the imperatives of energy security and climate change, by penalizing fossil fuels and incentives to renewables, has been demonstrated much more complex than previously conceived.

The idea of bringing together the best of both worlds – the self-sufficiency and low emission, increased energy security and combat the factors causing climate change – concerning the expansion of renewable sources in the energy matrix has been facing relevant technological, economic and political-institutional obstacles.

The first obstacle is technological and concerns the requirement of significant advances in renewable technologies so they can actually compete with traditional technologies. These advances are related to overcome the problems associated with low capacity of storage, density and scale characteristics of the current stage of development of renewables. Continue lendo »

The future of biofuels VIII: The contrasting strategies of major oil companies and the future of the bio-economy

In biofuels on 04/07/2011 at 00:30

By José Vitor Bomtempo

The recent Ethanol Summit organized by UNICA in São Paulo, on June 6th and 7th, it seemed to be an interesting event for the line of reasoning that we have developed this series of articles. In some way, the Ethanol Summit addressed clearly – for the first time, I guess, in a relevant event in Brazil – the issue of industry of the future. Of course, many subjects of specific interest for Brazilian ethanol industry were highlighted and addressed in most, but some plenary sessions and meetings on Future and Technology addressed issues not so urgent.

Due to the Ethanol Summit, we propose a change in this blog that seems to be consistent with what we have developed: no more talk about biofuels of the future but we will talk about he new industry which includes in addition to biofuels, bio-products, biorefining and other bios that may arise. How should we name this industry?   As initial suggestion we have chosen bio-economy, which seems pretty comprehensive. Thus, we can say that the Ethanol Summit has provided a discussion of a number of questions related to the development of bio-economy worldwide and particularly in Brazil. In fact, all the videos of conference and plenary sessions can be watched here.

We will highlight in this article the plenary session O futuro do petróleo e o papel dos biocombustíveis (The future of oil and role of biofuels). The plenary session brought together executives from four major oil companies on biofuels: BP, Petrobras, Shell and Total. Continue lendo »

The future of shale gas and dynamics of the natural gas industry

In natural gas on 06/06/2011 at 00:30

By Marcelo Colomer

The development and improvement of horizontal drilling and hydraulic fracturing techniques have allowed the expansion for production capacity of natural gas in low permeability geological formations, especially in shale formations. In this new exploitation context, there is a growing shale gas production in the USA and Canada, where the increase in domestic supply of natural gas has completely changed the energy market.

However, despite the increase in Canada and USA shale gas production, there are still major uncertainties about the productive potential of natural gas in low permeability geological formations. This is explained not only by lack of geological data in specific shale formations, but also by high and still little-known environmental impacts of the shale gas production. Continue lendo »

Energy security and climate change: different views, several policies

In energy on 23/05/2011 at 00:30

By Ronaldo Bicalho

Energy security and climate change are the two main axes currently surrounded by the energy policies in the world.

Then, to ensure the supply of energy and reduce emissions of greenhouse gases have become major strategic objectives of Nation States in the energy field, with significant impact in the desired composition of the future energy matrix and setting the most appropriate strategies to achieve it.

However, the evaluation of the real consequences of these two objectives at the heart of energy policy needs a qualification. Especially, because Nation States perceive, hierarchized and insert into their set of public policies such goals, which, after all, translates into the amount of resources that, in fact, these States are willing to mobilize to achieve them. Continue lendo »

The future of biofuels VII – what does Brazilian role?

In biofuels on 09/05/2011 at 00:30

By José Vitor Bomtempo

In last article, we discussed the Petrobras strategy, arguably the most important actor in the future of energy in Brazil. We can infer from the initiatives of the company an effective participation in the biofuels industry. But this participation seems to occur in a view more committed to the current industry – so-called first-generation – than with the industry of the future – so-called advanced biofuels and other bio-products.

This perspective is supported when comparing Petrobras with other major oil companies such as Shell and BP (see the previous articles, the future of biofuels IV and V), which combine position in the current industry and a strategy for building new industry. Total is other oil company that has increased interestingly its portion on biofuels of the future. Total will be back on the next article. The question today is to examine the Brazilian role in the industry of the future and for this we must examine beyond the role of Petrobras. Continue lendo »

The future of biofuels VI: Petrobras’ strategy

In biofuels on 14/03/2011 at 00:30

By José Vitor Bomtempo

In the previous article, we compared the BP and Shell’s strategies for biofuels. Today we present the case of Petrobras. We have to recall the reasons for the analysis. We start with a basic distinction between competition within the existing industrial structure – ethanol and biodiesel – and the competition in what we call biofuels and bioproducts industry of the future – new processes and new biofuels and bioproducts. In the first case we have a typical competition based on positioning within a known industrial structure. In the second case, the industrial structure is not yet established, and the basis of competition is the ability to innovate and shape the new industrial structure. These points are developed in more detail in previous articles of this the series.

It is also important to note that the first-generation biofuels industry conversion technologies are available to investors from accessible external sources such as engineering/technology companies and equipment manufacturers. In the biofuels industry of the future – based on innovation in new commodities, new processes, new products – a fundamental change is to move the source of technology into the companies; thus, the technology tends to be much more advanced in bioproducts of the future and, therefore, owned. Therefore, there are large differences in the technological strategies of the current industry and the future of the industry. Continue lendo »

A future agenda for biofuels policy in Brazil

In biofuels on 17/01/2011 at 00:30

By Renato Queiroz

The Brazilian Association for the Study of Energy – AB3E – held on December 14, 2010, in Rio de Janeiro, a seminar to discuss the agenda for the Brazilian energy policy for the next administration. In the specific panel, where agenda for biofuels was discussed, there were two approaches: one from representative of Petrobras, Eduardo Correia, Competitive Strategy area, who identified a number of critical uncertainties that influence strongly the biofuels market, developing initially from these uncertainties four exploratory scenarios and selecting two scenarios for the next 20 years, and the other one from professor José Vitor Bomtempo, Energy Economics Group, who assessed the future of the biofuels industry in a strategic approach with assumptions that break current paradigms.

This article presents the considerations from these experts and question on the topic that will surely be discussed by energy policy agenda developers for future years. Continue lendo »

The future of biofuels IV: Brazilian position

In biofuels on 06/09/2010 at 00:40

By José Vitor Bomtempo

In the previous article, we discussed the nature of the ongoing innovation process. The importance of this process is that its evolution will define the structure of biofuels and bioproducts industry of the future. As a result, policies and strategies regarding the future of the biomass-based industry can not ignore this new structure under construction, due to losing current competitiveness later.

Our previous analyzes suggest that there are interesting opportunities ahead. The essential question is: Have strategies and policies in Brazil taken into account the opportunities and threats that this process brings us? Or do we believe undoubtedly that our competitive ethanol from sugar cane – which gives us an enviable competitive position in the current industry – is enough to ensure a prominent position in the industry of the future as well?

The two questions above summarize an issue that seems crucial to consider: competition in the industry of the future tends to be considerably different from what we have today in ethanol industry. The fact that we are leaders in this game – the first-generation biofuels – ensures us not necessarily a leadership position and even a prominent position in the industry of the future. Continue lendo »

The future of biofuels III: The innovation process that is building the industry of the future

In biofuels on 16/07/2010 at 00:30

By José Vitor Bomtempo

In the previous article, we presented a debate about points that can justify our central premise:  in the future, the industrial use of biomass will be very different from the current industry. The World Economic Forum has just published “The future of industrial biorefineries”, a report that reinforces the idea of a new industry under construction.

Note that this is the first work of the Collaborative Innovation Initiative group, established in 2009 to identify important trends in the global economy and contribute to the cooperative development of innovations.

In this article we will discuss the ongoing process of innovation that is based on construction of the biofuels industry of the future. Continue lendo »

The future of biofuels II: Why will the biofuels industry of the future be different from the current one?

In biofuels on 10/05/2010 at 01:30

By José Vitor Bomtempo

In our first article on the future of biofuels, we start from a clear premise: the biofuels industry of the future will be very different from the current one. It will be neither limited to current products – ethanol and biodiesel – nor the current processes and feedstocks. Its technological base and its industrial structure can be unrecognizable today.

This assumption is very important to ponder on the questions made previously. Let’s discuss it a little more and try to defend it. Continue lendo »

The future of biofuels

In biofuels on 29/03/2010 at 01:30

By José Vitor Bomtempo

The late Professor Keith Pavitt, one of the major starters of the studies in the economics of innovation, he used to say to his mentees that the goal of a research is not necessarily answer the questions, but make them better or “more answerable” as he used to say. I want to start this blog making some questions that we can do when we think about the future of biofuels and industry based on renewable raw materials. We will try to bring elements and discuss, as the master Pavitt wanted, in order to become these questions clearer, better formulated, if possible. After all, to begin we have to mention the masters, as Inácio Rangel said; no one solves problems that can not formulate clearly. So this is the initial effort for which the blog will try to help: improve our questions about the future of biofuels. Continue lendo »