The long-awaited US$8.5 billion 230,000-barrels…
A significant development this week…
When it comes to emissions reduction, carbon capture and storage is the main focus of the oil industry. That was the message from company executives and government officials who gathered this week in Calgary for the World Petroleum Congress.
The oil world signaled it was on board with emission reduction but it was not on board with oil demand destruction, per a Bloomberg report that quoted attendants including Aramco’s CEO, the chief executive of Exxon, and the Saudi energy minister.
“There seems to be wishful thinking that we’re going to flip a switch and we’ll go from where we’re at today to where it will be tomorrow,” Exxon’s Darren Woods said, adding “No matter where demand gets to, if we don’t maintain some level of investment in the industry, you end up running short of supply, which leads to high prices.”
We are seeing this in real time right now but it has not stopped transition advocates from forecasting peak oil demand and even calling for governments to target oil demand instead of supply as a way of reducing the production of hydrocarbons.
A recent column in Reuters argued that in order to reduce oil and gas production and related emissions, governments had to focus on end users and tax their use of hydrocarbons. In other words, the author argued for even higher prices for energy.
Such a course of action could backfire, however, according to Aramco’s Amin Nasser. He reiterated Woods’ call for stable investment in oil and gas, saying, “Otherwise in the mid to long term, we will have another crisis and we will go backwards in terms of using more and more coal and other cheap products available today. And all these decarbonization efforts will go down the drain.”
Alberta’s Premier Danielle Smith perhaps summed up the attitude of the industry best: “We are transitioning away from emissions,” she said, as quoted by Bloomberg. “We are not transitioning away from oil and natural gas.”
By Irina Slav for Oilprice.com
Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.