Copyright ©2009 NPR. For personal, noncommercial use only. See Terms of Use. For other uses, prior permission required.

STEVE INSKEEP, host:

The news headline about oil prices is the way that they've dropped in the last year. For oil executives though, the story has not changed. Oil companies look ahead five years, 20 years, even 40 years, and over that time period a top executive of Shell Oil sees ever stronger demand, which means a good chance of very strong prices. That's part of the reason that Marvin Odum was in Washington, D.C. this week. He's president of Shell's operations in the Americas, and he joined other executives urging Congress to allow more off-shore oil drilling. That got us talking about the broader energy picture.

Let me talk a little bit about your assumptions for demand. And let's just talk about the United States, your biggest customer. I believe the United States is using something like 21 million barrels of oil per day?

Mr. MARVIN ODUM (Shell Oil): That's right. Maybe a little less right now, but that's right.

INSKEEP: 'Cause it's gone down a little bit? Where do you expect that to go over 20 years?

Mr. ODUM: When you talk about energy, you almost have to start at the bigger picture, and there's really three things that guide us in our global strategy and where we see energy going for the world. And the first is that the world demand for energy is clearly going to increase. By some estimates, I think reasonable estimates, the world energy demand could double by the middle of this century, by 2050.

The second piece that we use to guide us is that some of the easy sources of energy that we've used in the past are becoming harder to find and harder to get. And then the final piece is that much more energy usage and demand has an impact on the environment.

Now, you asked specifically about where U.S. demand is going. It's not going to grow like these developing countries. You know, whether it's flat, slightly growing, or even slightly declining in years is almost irrelevant from a global energy picture, because the other pieces will dominate.

INSKEEP: Well, let me ask about that though. We are still talking about the largest energy consumer, and you are in Washington among other things talking about expanding offshore drilling on which there's been a ban on many projects for many years. What makes you think that you can find enough oil to make a significant difference, given the huge amount of world demand and the huge increase that's seen.

Mr. ODUM: Well, it's a really important question. You mentioned the 20 million barrels or so that we use. About 60 percent of that is imported from other parts of the world. Now, that has implications on the U.S. economy. It has implications on national security. So the opportunity for the U.S. is to recognize that that demand - that oil is going to be used for many decades to come.

INSKEEP: Marvin Odum, I want to come back to that notion of the United States imports something like 60 percent of its oil at the moment. Assume that you did get carte blanche to go anywhere you needed to go in the United States to drill; what's a realistic number to get that down to?

Mr. ODUM: You know, broadly being able to increase U.S. production on the order of millions of barrels a day is realistic. And so you start to cut into that import quite a bit. You know, I use the words reduction of imports. And I use the words less often - energy independence - because I think that will take a long time and that will take a shift in the energy mix overall.

INSKEEP: When you talk about raising it by a few million barrels, you're saying maybe 60 percent goes down to 50 percent, 40 percent; we're still dependant on foreign oil.

Mr. ODUM: Or more. And we will - we will clearly import oil as we go through in the forward decades. But of course there's a strong intent in this country to transition to green energy sources, and I support that transition. I think I'm realistic about how quickly that transition can take place. So in the meantime, reducing our imports by producing our own and then also seeing the benefits of the jobs and the impact on the economy and trade balance and national security is a good thing.

INSKEEP: A couple of months ago I had a chance to listen to a CalTech professor named Nathan Lewis and he basically asks the question from the other direction. If the population is going to go up dramatically and world energy demand is going to go up dramatically, what would you actually have to do in order to reduce the amount of carbon going into the atmosphere in a significant way, in a way to affect global warming?

Mr. ODUM: Right.

INSKEEP: And when he runs all of his numbers, he doesn't find that you can do that with a gradual evolution of the energy market. He basically says when you do the numbers you would radical, unbelievable, almost unimaginable changes in the way we use and produce energy in order to have any affect whatsoever. Is he right about that?

MR. ODUM: Well, I think he makes some important points there. I think another approach, which is really important, is how quickly can the less CO2-intensive energies develop. So I think approaching it from what's a realistic ramp-up of these alternatives, as well as what's it actually going to require to get there, they're both important directions to come at the problem.

INSKEEP: But if you think of this as a leaky ship, let's say, I mean do you worry as a corporate executive that you'll do some well-intentioned things and you'll have the right motivations and you'll plug a few leaks in the ship and other people will plug a few leaks, but in the end the ship is still slowly sinking?

Mr. ODUM: That's not the way I look at it because I think we have to do what we can. The idea of producing oil and gas is sort of pitched as a - it's oil and gas at the expense of developing renewables. That's not the tradeoff. It's a transition, and the question is how quickly can we transition to green energy sources, not is it one or the other. Because the world is going to need both to run for that period of transition.

INSKEEP: Marvin Odum of Shell Oil, thanks for coming by.

Mr. ODUM: Thank you, Steve.

Copyright © 2009 NPR. All rights reserved. No quotes from the materials contained herein may be used in any media without attribution to NPR. This transcript is provided for personal, noncommercial use only, pursuant to our Terms of Use. Any other use requires NPR's prior permission. Visit our permissions page for further information.

NPR transcripts are created on a rush deadline by a contractor for NPR, and accuracy and availability may vary. This text may not be in its final form and may be updated or revised in the future. Please be aware that the authoritative record of NPR's programming is the audio.

Comments

 

Please keep your community civil. All comments must follow the NPR.org Community rules and terms of use, and will be moderated prior to posting. NPR reserves the right to use the comments we receive, in whole or in part, and to use the commenter's name and location, in any medium. See also the Terms of Use, Privacy Policy and Community FAQ.