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The future energy mix

Ministers at the WEF 2012 discussed the future of fossil fuels

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One of the central session at the World Energy Forum focused on fossil fuels.
One of the central session at the World Energy Forum focused on fossil fuels.

A central session of the World Energy Forum considered how fossil fuels can meet future energy needs whilst ensuring they remain economically sound and environmentally solid

Dubai welcomed the world through its doors in October, with the first World Energy Forum to be held outside of New York held in the city between 22-24 October.

Under the patronage of HH Sheikh Mohammed bin Rashid Al Maktoum, Vice President of the UAE and Ruler of Dubai, the event had an ambitious remit to discuss how to achieve sustainable energy supplies for all.

“We will chart a roadmap with the nations of the world to put plans and initiatives in action that can provide safe, sustainable and accessible energy for the peoples of the world, to fuel global social and economic development.

This roadmap requires clearly linked and measurable goals and milestones to achieve this,” HE Mohammed Al Tayer, Vice Chairman of Dubai’s Supreme Council of Energy, told Utilities Middle East before the event kicked off.

With such a broad, far-reaching mission, it is telling that the first topic discussed during the conference’s second day was the continued primary importance of fossil fuels to the global energy mix.

Featuring a sweep of energy ministers from around the Middle East, Africa and India, the panel discussed the future role of oil and gas in meeting energy needs, together with considerations of how negative impacts – chiefly environmental and financial – can be circumscribed.

Whilst most of the panel was keen to emphasis the future potential of renewable energy, and their own states’ methods of adopting them, the presentations were largely focused on efficient and economic use of fossil fuel reserves.

Indeed, in the opening panel speech, India’s oil and gas minister, Jaipal Reddy, emphasised both of these points as the key challenges he believed the Forum needed to address, saying: “Fossil fuels cannot be pushed away, but their environmental effect can be mitigated and prices can be made lower. The Forum can and should make a positive move in this direction.”

India currently relies on fossil fuels to meet 92% of its energy needs, and Reddy said that he foresaw natural gas becoming the fastest growing fuel source, with coal (currently contributing 53% to the country’s total fuel mix) maintaining its predominant role.

He also suggested that renewables have a “miniscule share” of the global energy mix, and could not even supplement, much less supplant, fossil fuels in the near-term.

The minister also suggested that India was taking a two-pronged approached to shale gas – a “game-changer” for the industry – with plans to acquire assets abroad in addition to ramping up domestic production.

Oman’s oil and gas minister, Dr Mohammed Hamad Al Rumhi, suggested that a key part of the energy question that needed settling was ensuring the industry focuses as much on the consumer side of energy, as it does on supply security issues.

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He argued that the oil and gas industry has demonstrated considerable innovation in discovering and exploiting new sources of oil and gas – in particular shale gas and enhanced oil recovery – during the last three years.

However the industry, he said, has been “less successful at reaching those needing energy most” – the two billion people who are not connected to the electricity grid.

In common with other speakers, he argued that renewables could play a part on the issue of “energy starvation”, but argued that it was a mistake to create environmental obstacles to the use of fossil fuels.

Mohammed bin Dha’en Al Hamili, the UAE’s own minister of energy, argued similarly that the key issue was to ensure energy for all; emphasising that the UAE still remembers the days before electricity, with the grid only becoming operational in the 1970s.

He said that hydrocarbons must be “used responsibly” to preserve them for future generations, and to ensure the “age of oil” continues for as long as possible.

Al Hamili emphasised the UAE’s own renewables progress, such as the contribution Masdar has made to global renewable development, and also called for all countries to join the International Renewable Energy Agency (IRENA) based in Abu Dhabi.

He suggested that interconnectivity is at the heart of the energy debate, with projects such as the Dolphin pipeline and the GCC grid interconnection project providing a raft of economic and social benefits.

Iraq’s minister of electricity, Karim Aftan Al Jumaili, focused his attention on the work his country is doing on renewable energy – reporting that Iraq is planning for 20GW of hydropower capacity, and is also looking at wind and solar power to provide electricity to remote areas of the country.

Iraq is also looking at operating new gas units utilising natural gas (with 5GW of natural gas capacity in operation to reduce environmental effects) as well as considering the introduction of combined cycle technology to its power facilities.

Algeria’s energy and mining minister Youcef Yousfi warned that a “lack of financing is a serious hurdle” to renewable energy making a real contribution, with costs of solar, wind and geothermal all remaining too high for many countries.

He also introduced the suggestion that Fulushima had raised questions about the future of nuclear power and suggested its future use might be limited to a few countries. Oil, natural gas and coal, he said, would remain predominant through to 2040, where they collectively would still represent 80% of the global energy mix.

Mohamed Saleh Abdulla Al Sada, Qatari industry and energy minister, summed up the session’s central theme, saying: “Fossil fuels will be the centerpiece of the energy equation for decades to come.”

He – perhaps not surprisingly given his country’s reserves – talked up the future potential for natural gas, saying it is the “perfect complement to renewable energy” and an essential part of meeting future power generation needs.

World Energy Forum
Founded in 2008 by Harold Hyun-Suk Oh, the World Energy Forum aims to ‘create an energy-secure world that can benefit all nations and peoples’. The Forum, which has – until this year – met annually in the UN headquarters in New York, aims to find ways to ensure energy security for people around the world.

The organisation seeks to advance both the necessary technological developments, as well as facilitating the political advancements needed to ensure that energy policies promote a cheaper, cleaner and safer energy mix.

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