Quest for sus­tain­able en­ergy

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The United Na­tions Gen­eral Assem­bly has pro­nounced 2012 as ‘The In­ter­na­tional Year of Sus­tain­able En­ergy for All’ (SE4ALL). The 13th In­ter­na­tional En­ergy Forum and the 5th In­ter­na­tional En­ergy Busi­ness Forum in Kuwait re­flected a univer­sal as­pi­ra­tion for ac­cess to mod­ern, af­ford­able and sus­tain­able en­ergy for all, as well as the de­sire of all coun­tries to achieve the Mil­len­nium De­vel­op­ment Goals.

In­ter­na­tional En­ergy Forum is the world’s largest gath­er­ing of en­ergy min­is­ters. It is an in­ter­gov­ern­men­tal ar­range­ment which works to fa­cil­i­tate di­a­logue among its mem­bers that com­prise en­ergy pro­duc­ing and en­ergy con­sum­ing coun­tries.

This year’s Forum comes af­ter the In­ter­na­tional En­ergy Forum (IEF) Char­ter which was signed in Saudi Ara­bia in 2011 and also at a time in which the global en­ergy mar­kets are wit­ness­ing ma­jor de­vel­op­ments which could have a long-term im­pact on en­ergy mar­kets.

The event brought to­gether decision-mak­ers, in­ter­na­tional or­ga­ni­za­tions and CEOS of en­ergy com­pa­nies as well as in­dus­try ex­perts from around the world to en­gage in ef­fec­tive di­a­logue with the ob­jec­tive of en­sur­ing mar­ket sta­bil­ity, re­li­able en­ergy sup­plies and ad­dress­ing fu­ture en­ergy chal­lenges.

Min­is­ters and CEOS dis­cussed fu­ture in­dus­try chal­lenges and the need for nec­es­sary in­vest­ment to meet the fu­ture global en­ergy de­mand and fo­cus on ways of im­prov­ing safety of fa­cil­i­ties along the en­ergy chain with­out ham­per­ing in­vest­ment.

The dis­cus­sions in the 5th IEBF and the 13th IEF min­is­te­rial meet­ings were struc­tured in six ses­sions, fo­cus­ing on vi­tal is­sues such as meet­ing fu­ture en­ergy de­mand through in­vest­ing in an un­cer­tain fu­ture, mit­i­gat­ing volatil­ity, achiev­ing en­vi­ron­men­tal and so­cial sus­tain­abil­ity with lower emis­sions and en­ergy ac­cess for all be­sides the global en­ergy di­a­logue. In ad­di­tion, CEOS of en­ergy com­pa­nies en­gaged in dis­cus­sions on ways and means to en­hance NOC-IOC co­op­er­a­tion by de­vel­op­ing guide­lines for suc­cess­ful part­ner­ships.

Sheikh Sabah Al-ah­mad Al-sabah, Emir of the State of Kuwait, de­clared in his open­ing ad­dress that all coun­tries of the world had the right to seek so­cial and eco­nomic ad­vance­ment as well as up­grade in the stan­dards of liv­ing of their peo­ples. Ac­cord­ing to him, this would re­quire fight­ing en­ergy-poverty and se­cur­ing en­ergy for ev­ery­one.

Suleiman J. Al-her­bish, Di­rec­tor-gen­eral, OPEC Fund for In­ter­na­tional De­vel­op­ment, high­lighted OFID’S global ef­forts at com­bat­ing en­ergy poverty since the in­sti­tu­tion’s in­cep­tion in 1976. He said OFID’S pri­or­ity has al­ways been the many mil­lions of peo­ple still re­liant on fuel wood, can­dles and bat­ter­ies for daily do­mes­tic needs - cook­ing, light­ing and con­tact with the out­side world. Ac­cord­ing to Al-her­bish, for OFID, work­ing to­ward univer­sal en­ergy ac­cess for the poor is an es­sen­tial part of the SE4ALL Ini­tia­tive.

The ap­plied suc­cess of the IEF di­a­logue turns on its work in im­prov­ing co­op­er­a­tion be­tween the Na­tional Oil Com­pa­nies (NOCS) and In­ter­na­tional Oil Com­pa­nies (IOCS) through the In­dus­try Ad­vi­sory Com­mit­tee (IAC). The body is very much un­der in­dus­try ‘own­er­ship’ with com­pany ex­ec­u­tives chair­ing it and steer­ing the busi­ness dis­cus­sions and chan­nel­ing busi­ness in­put into the min­is­te­rial forum.

As Stu­art Brooks of Chevron and Adeeb AlAama of Saudi Aramco ex­plained, the Com­mit­tee is well placed to act as a ‘radar screen’. It en­ables the in­dus­try to spot emerg­ing is­sues of con­cern, and to put these is­sues in front of gov­ern­ment pol­icy-mak­ers. In a di­verse in­dus­try, there are nat­u­rally nu­anced views on the essence of NOCIOC re­la­tion­ship.

Christophe de Marg­erie of To­tal views joint NOC-IOC ven­tures as po­ten­tially not only lon­glast­ing in­dus­trial part­ner­ships but also some­times ex­tend­ing into the fields of health, ed­u­ca­tion or cul­ture. For Rex Tiller­son of Exxonmo­bil, the sound­est foun­da­tion for IOC-NOC part­ner­ships is mu­tual ac­cep­tance of part­ners’ re­spec­tive strengths and re­spon­si­bil­i­ties. He ex­tended this to in­clude the role of re­spon­si­ble gov­ern­ments to pur­sue mar­ket-based poli­cies, based on the rule of law and sanc­tity of con­tracts.

John Wat­son of Chevron sees the pur­suit of af­ford­able en­ergy sup­plies as the best way of align­ing in­ter­ests across the in­dus­try. Farouq AlZanki of Kuwait Petroleum Cor­po­ra­tion sug­gested that some pres­sures may be push­ing IOCS and NOCS apart. The for­mer are driven more by de­mands of cap­i­tal mar­kets and their in­ter­na­tional in­vestors, while the lat­ter are pri­mar­ily pressed by so­cioe­co­nomic and po­lit­i­cal de­mands at home but Kuwait has still struck win-win co­op­er­a­tion deals with IOCS.

Sudhir Vasudeva of In­dia’s ONGC said his com­pany’s part­ner­ship with IOCS has been “most sat­is­fac­tory”. In­dia val­ues co­op­er­a­tion, given that it has 17 per­cent of the world’s pop­u­la­tion but only 0.6 per cent of oil re­serves and 0.8 per cent of gas re­serves. Peter Voser of Royal Dutch Shell sees op­por­tu­ni­ties for IOC-NOC co­op­er­a­tion to fo­cus on gas – in par­tic­u­lar, the ex­ploita­tion of sour or tight gas reser­voirs com­mon in the Mid­dle East; the sat­is­fac­tion of fast-grow­ing de­mand for LNG and in the cap­tur­ing of gas whose as­so­ci­a­tion with oil can make its ex­trac­tion hard to man­age.

Jakob Thomasen of Maersk Oil ex­plained his com­pany’s in­no­va­tive use of gas, burned with pure oxy­gen to pro­duce clean power, pure water and CO2 for en­hanc­ing oil re­cov­ery.

Lastly, look­ing to se­cure fu­ture hu­man re­sources to sus­tain the in­dus­try, Pierce Riemer of the World Petroleum Coun­cil urged greater ef­forts to at­tract young peo­ple to the in­dus­try. It is ex­pected that the In­ter­na­tional En­ergy Forum will gal­va­nize the in­ter­na­tional com­mu­nity into fresh ac­tion to pro­vide ac­cess to ba­sic en­ergy for 7 bil­lion peo­ple around the globe.

Con­fer­ence par­tic­i­pants.

Sheikh Sabah Al- Ah­mad Al- Sabah, Emir of the State of Kuwait.

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