BP cuts forecast for gas reserves due to Russia

OIL major BP cut its estimates of global gas reserves steeply yesterday, revising Russia’s still classified reserves down sharply and putting Iran at the top of the world league table.

In its benchmark annual statistical review for 2012, BP put global proven gas reserves at 187.3 trillion cubic metres as of the end of 2012, enough for about 56 years worth of global production at current rates.

BP’s last report for 2011 estimated global gas reserves at 208.4 trillion. The cut of 21 trillion equals roughly to seven years of global gas consumption.

Russia, the world’s biggest gas reserves holder for many years, was responsible for the bulk of the reduction, with its reserves estimate downgraded to 32.9 trillion from 44.6 trillion.

BP’s chief economist, Christoph Ruhl, said the company decided this year to adjust its estimates for the former Soviet Union, including Russia, where data on reserves is classified.

“Traditionally countries of the former Soviet Union had different criteria than used elsewhere. So we used a conversion factor to convert that from those countries where we don’t get direct data,” Ruhl said.

“In some countries, reserves are still a state secret, so we have to rely on these data,” he added.

The downgrade left Iran at the top of the table of the world’s largest gas reserves holders for the first time in decades, with its broadly unchanged reserves of 33.6 trillion.

On the oil side, BP estimated global proven oil reserves at 1,669bn barrels at the end of 2012, up slightly from 1,654bn at the end of 2011 and enough to maintain current global production levels for 53 years.

In its report a year earlier, BP had revised global oil reserves sharply higher as new technology made heavy crude grades in Canada and Venezuela economically profitable to extract.

The US, where the energy industry has been transformed by shale oil and gas, saw oil reserves rise to 35bn barrels from 31bn last year, more than two per cent of global reserves.