Simulation of the Path and Peak of Gas Production from Iran's Independent Offshore Fields and Revenue Flow Scenarios

Mohammadali, Hanieh; Moshrefi, Rasam

doi:10.29252/jem.2022.227800.1768

Simulation of the Path and Peak of Gas Production from Iran's Independent Offshore Fields and Revenue Flow Scenarios

Document Type : Original Article

Authors

Hanieh Mohammadali ¹
Rasam Moshrefi ²

¹ MA in Economics, Faculty of Economics and Political Science, Shahid Beheshti University, Tehran, Iran,

² Assistant Professor of Economics, Faculty of Economics and Political Science, Shahid Beheshti University, Tehran, Iran

10.29252/jem.2022.227800.1768

Abstract

Hubert's theory showed US oil production on a bell-like curve in 1956 and was introduced in the energy economics literature. This theory shows the lifespan, time trend and peak production of hydrocarbon reserves. In this research, the gas production from independent offshore gas fields, which provide about 60% of the country's natural gas production, was simulated. To compensate for the theoretical limitations of Hubert's model for not considering the dynamics in the ultimate recoverable reserves, the production process and cumulative production, the System Dynamics methodology were used. The model was used to simulate the production volume and present worth of the national wealth of gas produced from independent offshore fields. The simulation results indicate that in the base scenario, the peak production is in the year 1413 (Persian calendar) by 2263 million cubic meters per day of gas production, and the present value of the accumulated produced gas will be $1354 billion at a price of the year 1401. The simulations results show that extraction with an annual growth rate of 13% (average from the year 1390 to 1396) would only be possible up to the year 1404. Each one per cent increase in the recovery factor adds $11 billion to the present value of accumulated production, and a leakage of 10% of the recoverable reserves would cause an economic loss of $87 billion to the national wealth.

Keywords

20.1001.1.24765775.1401.13.2.6.1

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