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TOEFL Exam – Reading Instructions
Instructions: Read passage 1 of our free TOEFL exam below. Then click on the “Start Quiz” button to see the questions for TOEFL exam. Then click on “Finish Quiz” to see the answers.
TOEFL Exam – Passage 1
The Future of World Oil Supply
When will global oil supply stall and start to decline? An important part of the answer to this frequently-asked question comes down to oil field decline rates – that is, the annual rate at which production from existing fields goes down. The decline rate is a key link in the chain of factors needed to understand the future of the world oil supply. In an effort to answer the question about the global decline rate, Cambridge Energy Research Associates (CERA) launched a detailed, in-depth research project that culminated in our new study entitled Finding the Critical Numbers: What are the Real Decline Rates for Global Oil Production?
To do the research, CERA undertook a substantive analysis drawing on the most extensive field production database in the world that includes tens of thousands of fields. The particular data set used in the study covers the production characteristics of 811 separate fields. These are the biggest producers. Combined together, these fields account for over 60 percent of the world’s current conventional oil production and half of total proved plus probable reserves.
Forecasting how much existing oil fields will produce in the future is challenging because the amount that can be produced from a field in any given year varies over time. Production typically rises during a field’s early years. This is the build-up phase, which lasts from the onset of production until the field reaches 80 percent of its maximum potential production. After the build-up phase, a field goes into the plateau phase, when it is continuing to produce at 80 percent or more of its maximum potential. A field then reaches the decline phase, which lasts from the time production first falls below 80 percent of maximum until, after a number of years, production declines to a low enough level that the field is no longer economic.
Future production from existing fields depends on where along the spectrum – from build-up to plateau to decline – the world’s fields are in aggregate. Thus, the global decline rate is at the centre of any estimates about how much new oil must be discovered and brought on line in the future to replace capacity lost through the decline in production from existing fields, as well as to meet anticipated demand growth. A small difference in assumptions about the decline rate can make a huge difference in projections about how much new oil production will be needed in the future. For example, the difference between assuming a 10 percent global decline rate, as opposed to a 5 percent rate, translates into a swing in which the world would need to discover and bring on line an extra 18.5 million more barrels of oil per day by the year 2017 – an amount equal to nearly one quarter of total oil production today.
Out of the 811 fields analyzed in the CERA study, 400 are large (more than 300 million barrels of originally proved, plus probable reserves) and the remainder, small (less than 300 million barrels of originally proved, plus probable reserves). They can be broken down into two groups: 375 fields are still in the build-up or plateau phases, with 436 in the decline phase.
When the CERA team analyzed recent production trends in its data base, it found that the aggregate global decline rate for fields currently in production is approximately 4.5 percent per year. This is far lower than the 8 percent figure used by many studies. One reason for this difference, we conclude, is that some analysts focus only on the fields that are in decline, not taking into account the production from the many fields in the world that are still in their build-up or plateau phase. The 4.5 percent figure provides additional support for CERA’s view that oil production capacity, at least in terms of the physical resource, can grow enough over the next decade to meet the anticipated increase in demand.
A key conclusion of the study is that there is no evidence that oilfield decline rates will increase suddenly. The study of decline rates allows for better and more reliable projections about future oil supply. The CERA study is a signpost that shows we are gaining a better understanding of the below-ground factors, such as decline rate, that will shape the future of world oil supply.
TOEFL Exam – Questions to the passage
Question 1: All of the phrases from the passage illustrate aspects that can generally influence estimates of oil production except:
(a) ‘the most extensive field production database in the world’
(b) ‘the amount that can be produced from a field in any given year varies over time’
(c) ‘Production typically rises during a field’s early years’
(d) ‘where along the spectrum – from build-up to plateau to decline – the world’s fields are in aggregate’
Question 2: What criticism of other studies does the writer suggest in paragraph 6?
(a) They focus only on decline rates, rather than production.
(b) They utilize incorrect percentages in carrying out their analysis.
(c) They fail to recognize oil production capacity as a physical resource.
(d) They fail to take into account sufficient data from fields that are in the early phase of production.
Question 3: According to the text, why will oil production capacity be able to meet the anticipated increase in demand?
(a) Because CERA has calculated a decline rate of 8 percent.
(b) Because oilfield decline rates are not as bad as previously thought.
(c) Because the CERA study has resulted in better and more reliable projections.
(d) Because of below-ground factors.
Answers
Answer 1: The correct answer is A. All of the phrases from the passage illustrate aspects that can generally influence estimates of oil production except for the phrase ‘the most extensive field production database in the world’. This phrase, which is from paragraph 2, describes information used to analyze production in one particular study, rather than general aspects that influence production. So, this is similar to a ‘main idea’ type of question: you need to look for the specific idea, and rule it out.
Answer 2: The correct answer is D. The criticism of other studies that the writer suggests in paragraph 6 is that they fail to take into account sufficient data from fields that are in the early phase of production. Paragraph 6 states: ‘some analysts focus only on the fields that are in decline, not taking into account the production from the many fields in the world that are still in their build-up or plateau phase’. Remember that, according to the text, the build-up and plateau phases are the early phases.
Answer 3: The correct answer is B. According to the text, oil production capacity will be able to meet the anticipated increase in demand because oilfield decline rates are not as bad as previously thought. Paragraph 6 states that ‘when the CERA team analyzed recent production trends in its data base, it found that the aggregate global decline rate for fields currently in production is approximately 4.5 percent per year. This is far lower than the 8 percent figure used by many studies’. A decline (or loss) at a rate of 4.5% is better than a decline at a rate of 8%.
More TOEFL Exam Practice
You can now continue to TOEFL Exam – Reading Passages 2 and 3.