Energy transition requires the involvement of all forms of energy, fossils to help lower emissions and this would require continued investments to guarantee energy security, the head of OPEC has said.
Haitham AI Ghais, secretary general of the Organization of the Petroleum Exporting Countries (OPEC) said in a statement that there is no one one-size-fits-all solution.
“The focus must be on reducing emissions, not choosing between fuels. There is a need to ensure that all voices are heard, all relevant technologies employed, and all energy sources utilised,” he said.
He said the oil and gas industry needs to continue investing to ensure energy security alongside the energy transition.
“Chronic underinvestment needs to be rectified. It is not something we can leave till tomorrow. It is about today,” Ghais said.
These comments were echoed by Sultan al-Jaber, the CEO of the UAE’s Abu Dhabi National Oil Co. and president of COP28 UN Climate Change Conference in Dubai in 2023.
Jaber, the minister for industry and advanced technology, is the first CEO of a company to hold a COP presidency. This appointment ruffled the feathers of some non-governmental organisations.
“The energy transition will require every segment of society working together in an inclusive effort, and that surely means including the efforts of the energy industry,” Jaber said.
“In my view, it is not a conflict of interest. It is our common interest to have the energy industry work alongside everyone on the solutions the world desperately needs.”
According to the statement, officials from the UAE, OPEC’s third-biggest producer, have emphasised the need to continue investing in the oil and gas industry while at the same time reducing their emissions.
Also, officials from Saudi Arabia and the UAE, which are ramping up their oil production capacities by 2027, often cite their low carbon-intensive oil production as an indication they are likely to supply the world’s last oil barrels, the statement said.
“The world will consume 30 percent more energy by 2050. The world still needs hydrocarbons, and they need them to bridge the current energy system to the new energy system,” Jaber said.
“We cannot under any circumstances think that we can unplug the current energy system before we build the new energy system. As such, we must minimise the carbon footprint, only invest in the least carbon-intensive barrels, and continue reducing their intensity.”
Jaber also emphasised the need to invest and adopt new technologies, such as carbon capture, storage and utilisation, and hydrogen, to lower the oil and gas industry’s emissions and participate in the energy transition.
“Renewables alone are not enough, particularly in hard-to-abate sectors. Without a breakthrough in battery storage, we must invest heavily in carbon capture, nuclear power and hydrogen value chain,” Jaber said.
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According to the statement, Joseph McMonigle, secretary general of the International Energy Forum (IEF), stressed the need for a two-pronged approach to investing in hydrocarbons and reducing emissions.
“Energy security, not just energy transition, should be a top priority. Energy security was out of fashion for many years, but today the energy crisis has delivered a reality check and put energy security back on the agenda worldwide,” McMonigle said.
“Energy security is often misunderstood. True global energy security cannot be a zero-sum game where the winner takes all at the expense of others.”
According to McMonigle, annual upstream oil and gas investment will need to hit $640 billion in 2030 to ensure adequate supplies.
“Even if the industry presses ahead with the clean energy revolution, we will rely on oil and gas for our energy needs today,” said McMonigle.
“So, while we ramp up investment in renewables and pursue the energy transition, we need to keep investing in oil and gas globally and protect the quality of life for everyone.”
