The Future of Brunei

An anonymous comment on my post yesterday on The Brunei Housemaids went like this:

"... As a senior government officer, Do you think, if ever in the future, that the situation will be the other way around? i.e. bruneian going abroad to work as labours and maids ..."

I will not anwer that directly but I will delve slightly further into two other comments which were posted on my post on Thankful to be in Brunei Darussalam when I listed some of the current subsidies provided by the Brunei Government. The two comments given by Akatsuki and an annonymous commentator basically answers that question. Akatsukti commented:

"...Being in Brisbane has made me realise how pampered life is in Brunei. I know this comfortable life won't last long. The black gold is going to run out sooner or later. Better be prepared, right? ..."

and the annonymous comment on the same vein noted that:

"...Many here are still unaware of the differences between the real world and our sheltered and protected world here. We get so many benefits and subsidies here. Sure we still have our faults.. but without these faults, we would live in a perfect eutopia. Oil is a finite resource that will soon run out. How long? Only Allah will know. He that is merciful and generous has gifted us with a monarch that is caring and the resources to care for his people. However, The All Mighty will not want us to be complecent. What he giveth, he will take away for every action has its purpose..."

Our oil wealth is fairly recent and like most non-renewable natural resources will one day run out. In the 1980s, we were warned that oil will run out in about 20 years time which is about now. So far, with the help of technology, we have been able to push that end further. But there will be a point in time when no matter how much technology we use the oil will no longer be there. Today's prices helped by the various economics and geopolitics in the Middle East, Europe and the Americas and to a large extent to China and India, have reached stratospheric level giving us tons of surpluses. When I was last at the Finance Ministry in 1998 when we were looking at oil prices of around $11 a barrel, I could not even contemplate then I could be looking at $80+ a barrel and rising. But then oil prices may be $200 a barrel, if you got none to sell, then that matters naught.

In 1950s and 1960s, the Philippines economy was then the fastest growing economy in Asia. They were considered the Tiger Economy of Asia. In the 1980s and 1990s, Thailand, Korea and Malaysia were the new Tigers. Those tiger titles are no longer valid. They are still growing but not at the same fast furious paces. In the 1800s and 1900s, the sun never sets on the British Empire - it's so large that it circles the world. Today - what British Empire?

Brunei controlled the Island of Borneo, the southern parts of the Philippines Islands and the northern part of the Java Island in the 1500s. By 1906, we shrunk. Our economy was so poor that it could not support the small number of people we had then. Many people migrated from Brunei to find work. So much so that there are more Brunei Malays outside Brunei than there are in Brunei now. The Government had to borrow money for day to day government and for the survival of the country. It took the Brunei Government until 1936 (30 years!) before we were able to pay everything back with interest. [Refer to paper].

Today, Brunei is still a small little country but wealthy. Luckily where we are now is where the oil is. Talk about divine intervention. The point is, do not expect what we have today to be what we have tomorrow. We have to look after ourselves. Do not squander what we have today. History has taught us that lesson. If we don't heed our lesson and we do not save, tomorrow, we may have the possibility of "bruneian going abroad to work as labours and maids."

Comments

Anonymous said…
What's the possibility of Brunei becoming the Dubai of Southeast Asia?.... and why can't we be like Dubai? In just less than 10 years, the transformation of Dubai is sooo awaresome... sigh...
Anonymous said…
hi, i am curious on the current estimates for how long the supply of oil in Brunei will last? Any shell workers willing to answer my question.. thx
mental jogger said…
no more easy oil ... that basically it ... I mean thru' coventional extraction ... it's tougher to extract new oil altho' there are considerable reserves available. But honestly lets not be complacent. We better start developing ourselves not to be very dependent with oil/gas whilst there is buying time ....
Aaron John said…
BSP and the govt will never reveal how much oil reserves we have left. But then again, NO ONE can tell exactly how much oil we have underground. Several schools of thought here. Some believe in the Hubert's Peak. Some believe that there is no peak but a plateau. Some even believe that the current world proven reserves are like the tip of an iceberg - and you know what they say about icebergs...Some even believe that oil will last forever. I for one is an optimist. I believe that oil will be available well after the current predictions. I also believe that with the current global political and corporate systems (or conspiracies?), oil will still be relevant especially due to its importance to the powers that be. Having said all these, we must start to open our eyes. We have to diversify our economy and not be wasteful. We have to start educating our children and youths about the seriousness of the situation. Teach them about our history. Enlighten them about other countries' success stories or failures. In the words of that politician character from The Manchurian Candidate "We must secure tomorrow today!"
This 1981 REUTERS report was obtained through The New York Times:

++++
REUTERS
Published: October 8, 1981

Brunei's total recoverable oil reserves are not far short of the total 1.5 billion barrels produced so far and will last 20 years at present production rates, John Wybrew, technical director of the Brunei Shell Oil Company, said today. But recovering much of the remaining reserves, he said, will be expensive and technically difficult. In the first half of 1981, production averaged 167,000 barrels a day.
++++

Today is 2006 and nobody has said anything about no oil. It is hard to estimate just how much is down there and the amount of technological innovation that may happen in between. Of course, without the Al-Mighty's will, all of it could be gone tomorrow.
mental jogger said…
that 2o years are basically the moving rolling averages ... meaning this year or next year or the coming years we'll have like another 20 years to continue producing year on year ... but that's why the exploration dept exists ... to explore more oil reservoirs so that production can be sustained in the longer run ... i think the reserves replacement ratios is in the region of 1:2 which in reality is difficult to achieve tho'. having said that i still have the faith that God Al'Mighty has the final say tho' ...

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