Petroleum Africa
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Friday, May 26, 2023
OPEC Secretary General HE Haitham Al Ghais related his concern about the push to divest or under invest in the petroleum industry in light of projected demand growth.
Speaking at the 30th Annual Middle East Petroleum and Gas conference, Al Ghais says that while OPEC member countries will work toward a positive, pragmatic and above all, realistic approach to the climate challenge, investment in the petroleum industry must continue to meet growing demand while simultaneously working toward climate goals.
During his speech, Al Ghais elaborated, “The reality is that oil and gas will continue to be an integral part of the energy mix for the foreseeable future. According to OPEC’s World Oil Outlook, oil is expected to retain the largest share in the energy mix throughout the outlook period, accounting for almost a 29% share in 2045.
“The global economy in 2045 is expected to be double the size it is today. The global population is set to increase by 1.6 billion people between now and 2045. As a result of these global demographic and economic changes, energy demand is forecast to increase by a significant 23% in the period to 2045. Such an increase in demand necessitates adequate investment in our industry. The global oil sector will need cumulative investment of $12.1 trillion through to 2045. Investment is also urgent to account for annual decline rates, which amount to about 5% in our industry.
“Despite the urgent need for investment, we have heard disheartening calls from some quarters to divest from hydrocarbons.”
OPEC has been clear in highlighting the very real and dangerous consequences of divestment or under investment in the oil industry:
“Given these high stakes, as an industry, we need to speak with one voice and louder than ever before on the harmful realities of under investment. Indeed, the antidote is international cooperation based on mutual respect, multilateralism and constructive dialogue, not constant and inconsistent criticism,” he added.
Al Ghais also highlighted the efforts OPEC members are making to reduce greenhouse gas emissions and make operations more sustainable. “OPEC believes that the challenge before us must be accurately diagnosed. It is about reducing greenhouse gas emissions and not the misguided narrative of replacing one energy source with another. Technological innovation will play a critical in realizing this objective. This is why our Member Countries invest heavily in hydrogen projects, carbon capture utilization and storage facilities, and the circular carbon economy.”
The full speech can be found here – Al Ghais address.
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