The Bottom-Up Economic and Geological Oil field production model (BUEGO) models the behaviour of oil production companies choosing to develop projects on the basis of required demand and each project's net present value. BUEGO contains historical data from 1992-2009 and models the period between 2010 and 2035.

The model consists of a data-rich representation of over 7,000 producing, undiscovered, and discovered but undeveloped oil fields including field-specific decline rates, 2P reserves, potential capacity increases, water depths, and capital and operating costs. BUEGO also incorporates the existing fiscal regimes of 133 countries including how these differ within a country depending on the characteristics or location of oil produced and the oil price.

BUEGO iteratively increases the oil price in each year to ensure there is sufficient new capacity coming on-line from projects with positive net present value to satisfy the demand levels provided by TIAM-UCL. A yearly average oil price is generated endogenously that is taken to be the minimum oil price necessary to bring on the marginal project to meet global demand in a given year.

A project's net present value is calculated by taking into account project specific details including costs, additional capacity available and decline rates, and country specific details such as tax regimes and discount rates. Since government tax takes can vary widely between different fiscal regimes, between different countries, between different price levels, and between different assumed capital costs, BUEGO individually generates the tax take of each country for each project, at each price iteration, in each year, when calculating the net present value of a given project.

Representation of different types of oil field in BUEGO

As well as including fields that were in production prior to 2010 ('developed'), fields that were discovered  before 2010 but which have not yet come on stream ('undeveloped'), fields discovered over ten years ago and for which there are no plans for development ('fallow'), BUEGO also estimates volumes of oil that are undiscovered as of 2010. A discovery process is specified to simulate a reasonable discovery rate of this resource. This stipulates that 5% of the total resource available is discovered in each of the first six years, 4% is discovered in each of the next six years, followed by 3%, 2%, and 1% in six year intervals. The year in which production can first commence from the first undiscovered field varies by country but ranges from 2012 and 2016. Newly discovered fields are assigned decline rates of either 9% or 5.5% depending on their location and size, and are assigned to water depths based on the estimated water depth distribution of total undiscovered resources within each country. These percentages have been derived from an exhaustive review of the relevant literature.

BUEGO also includes potential reserve growth from discovered fields, Arctic fields, extra-heavy oil (predominantly within Venezuela) and natural bitumen produced by either in situ or mining processes (predominantly within Canada).

Model summary

Type: Equilibrium oil resource model
Purpose: Medium and long term oil production and price projections
Spatial scale: Individual oil fields
Temporal scale: Model period 2010 - 2035 in yearly intervals
Contact: Christophe McGlade


The model is fully described in the forthcoming PhD thesis referenced below.


Journal papers

McGlade, C. and Ekins, P. (submitted to Energy Policy) Un-burnable oil - an examination of oil resource utilisation in a decarbonised energy system.

Conference papers

McGlade, C. (2013) A bottom up assessment of oil field production potential in the medium term. Presented at the International Energy Workshop 2013, Paris, France.

Other publications

McGlade, C. (2013) Uncertainties in the outlook for oil and gas. PhD thesis submitted to University College London, UK.