The UAE Minister of Industry Advanced Technology and Adnoc Group CEO, Dr Sultan Ahmed Al Jaber, has said the world will keep needing oil and gas even after the pandemic is over and in fact demand will grow, with oil and gas continuing to supply over half of the world’s energy needs for decades to come, writes Abdulaziz Khattak for OGN. 

 

Al Jaber said this at the Adipec Virtual 2020 Opening Ceremony. The largest event in energy sector is being held virtual this year due to the global Covid-19 pandemic from November 9-12. Many global leaders will be speaking at the event.

 

He said: “There are a few things we know are true. For a start, we now the world will still need oil and gas when all of this is over. Even at the height of the lockdowns in March and April, the world still consumed 75 million barrels per day (mbpd). By our estimates, oil demand fell below 19 mbpd for only 12 weeks.”

 

He said the months ahead will be challenging and oil demand may fluctuate, but “make no mistake the long-term fundamentals of our industry remain intact”. 

 

Al Jaber expected oil demand to grow to 105 mbpd by 2030 and continue to supply over half of the world’s energy needs for decades to come. 

 

At the same time, he said, the petrochemical sector will continue to grow at a healthy pace through and beyond 2050 in line with a steadily expanding global middle class.

 

He expressed confidence that the world will through this pandemic much stronger than before, adding that the industry has the people, talent and capabilities to be resilient.

 

Al Jaber said challenges offered opportunities, and for the industry those could be looking at doing things better, being more agile, lower costs, and be safer.

 

Opportunities for Adnoc

 

Al Jaber said Adnoc started its transformation four years ago, driving down cost and unlocking value across its portfolio, adding that there is opportunity to accelerate that progress.

 

“For example, take the way we have doubled down on embedding the latest digital technologies through our operations. We have saved $1 billion in the last four years by leveraging big data through our Panorama command centre. We have captured an additional $2 billion by adopting digital drilling.

 

“And together with the artificial intelligence (AI) leaders, G42, we have formed AIQ, a company especially dedicated to developing AI solutions that will further enhance efficiencies for our industry.”

 

He said there are also opportunities to maximise value. “In the case of Adnoc, we have been able to use the UAE and Abu Dhabi’s status as a trusted, business-friendly environment to complete several landmark transactions. We inked a $20-billion pipeline deal and unlocked $5.5 billion in value from our real estate. These deals were struck in the most difficult year for the global economy in recent memory. And they prove the enduring and the underlying value of our industry.”

 

Hoping for brighter days ahead for the industry, Al Jaber said there is even more value to be captured. 

 

He said: “At Adnoc, we are discovering this truth as we move into active trading. In September, we completed our first derivatives trade. Next month we will begin trading the full portfolio of our refined products. And in the first quarter of next year, we will see the launch of Ice Futures Abu Dhabi (Ifad).”

 

Ifad will be the first exchange to include futures contracts based on Abu Dhabi’s popular Murban grade, and will offer great value for producers and customers alike

 

Al Jaber said another expansion opportunity for Adnoc is in the downstream. “Our approach is to invest today to strengthen our position tomorrow by enhancing the UAE’s industrial base. Our JV with the Abu Dhabi Holding Company (ADQ) is an investment vehicle for partners to join us in accelerating the development of our petrochemicals and derivatives industry here in Abu Dhabi. We have the oil, natural gas, infrastructure and logistics, all in one place combined with the perfect geographical location.”

 

Climate

 

An important opportunity that the industry has to play a role in is climate change, Al Jaber said. “We as an industry can do more on climate change.”

 

He said: “Adnoc is one of the least carbon intensive producers in the world, but our aspirations are greater. In the next 10 years, Adnoc will reduce its greenhouse gas intensity by a further 25 per cent. We are expanding our carbon capture programme so that it annually stores 5 million tons of CO2. More importantly, we will explore the potential of new fuels such as hydrogen.”

 

In conlusion, Al Jaber said : “the world will keep needing oil and gas even after the pandemic but would want it to be as low carbon as possible.” --Tradearabia News Service