BusinessDay

OPEC’s Barkindo condemns opposition to oil investments

... says it is threatening global energy security

Mohammad Sanusi Barkindo, secretary-general of the Organisation of Petroleum Exporting Countries (OPEC) says calls to divest from fossil fuels is threatening energy security globally and undermining developing countries’ ability to grow their economies at an industry conference in Abuja.

The OPEC boss who leaves office next month, said these calls jeopardize efforts to achieve universal, reliable, and affordable energy access for people across the globe, including those in developing countries, such as Africa.

It also impacts consumers who deserve clear and consistent policies, which recognize oil as indispensable to global economic development and the world’s energy mix.

At the 2022 edition of the Nigerian Oil and Gas Conference (NOG) in Abuja on Tuesday, Barkindo said the policy narrative in the run-up to COP 26 last year in Glasgow, the UK was heavily disappointing as it came heavily against hydrocarbons which were at odds with the reality of the world’s energy needs.

“Developing countries were asked to turn their backs on their own hydrocarbon assets, even though the right to sovereignty over the use of their natural resources is covered in the Paris Agreements,” he said.

The OPEC boss said remarks by prominent world leaders including UN Secretary-General Antonio Guterres discouraging investments in hydrocarbons that are harming sustainable development efforts in developing countries like Nigeria.

Last month, UN Secretary-General Antonio Guterres suggested at a White House event that our industry is ignoring its responsibility to address the climate change challenge and is undermining global climate policies, Barkindos said.

“Such misleading pronouncements are terribly unfair, to say the least about an industry that many of us have dedicated ourselves to walking towards inclusive just and sustainable solutions to the climate challenge.

Read also: Nigeria’s OPEC quota shortfall raises ‘fiscal time bomb’ worries

He said these criticisms undermine industry efforts to deploy and promote cutting-edge technologies to reduce carbon emissions from the production and consumption of energy.

Citing OPEC research, he noted that the world will need 11.8trillion in new upstream, midstream, and downstream investments through 2025 to meet the current demand in the global energy market.

OPEC projects that the total primary energy demand will continue to expand by at least 28 percent by 2045.

The OPEC boss said oil will retain the largest share of 28 percent of demand with gas accounting for 24 percent of demand and both commodities will account for more than half of the world’s energy means for many decades to come.

According to Barkindo, recent calls by the group of rich nations under the G7 for oil-exporting countries to increase the oil production is an acknowledgment of the critical role of OPEC in this regard. Last week, he said the G7 Summit in Germany acknowledged the need for continued investments in fossil fuels to bridge the world’s energy needs.

“It is imperative, my dear friends that they translate these words into policy actions that show the importance of a broad portfolio of energy options, including oil and gas and support investments.

“Our industry cannot afford to sleepwalk into another crisis. It is of utmost importance that we seize opportunities to encourage more leaders to return to the rules and principles of the Paris Agreement.

“This means focusing on inclusive party-driven negotiations and decision making based on the science and data, not emotions and rhetoric, as we currently hear,” he said.

Later this year, COP 27 is billed to take place in Egypt, Barkindo said it offers a prime opportunity for developing nations including those producing oil and gas to make their voices heard.

“This is a chance to return the balance and for this to address critical issues such as adaptation, mitigation, and the means of implementation, especially climate finance and technology. A more open setting provides the platform for all of us to find the importance of multilateralism and mutual respect among nations,” he said.

The reality that more than 750 million people lack reliable access to electricity and a further 2.6 billion people, according to the IEA will not have safe and clean foils and technologies for cooking and heating in Sub-Saharan Africa makes it imperative for a sustainable energy plan.

“I want to show that an estimated 47 percent of people have simply no access to electricity and approximately 85 percent lack access to clean cooking and heating to cook breakfast, lunch, and dinner for the family.

Considering the enormous energy resources available on this continent, Barkindo said the calls for Africa to abandon its hydrocarbons, “is simply hard to accept.”

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