The 19th World Petroleum Congress (19th WPC), organized by the World Petroleum Council, celebrated its 75th birthday in Madrid and will congregate for its 20th edition in Doha (Qatar).
“I am glad that what began as a annual dinner for friends, to which only a few leaders in this sector attended, has become today in a world congress”, which has brought together for its 19th edition more than 500 managers and more than 200 companies from the 5 continents. This way talked Randall Gossen (Vice-Chairman of Security of Environment and Social Responsibility at Nexen and Chairman of the World Petroleum Council) at the closing ceremony.
During the 19th WPC there was time for the debate, to present the awards for the best people and companies within the industry and also to put on the board many of the hottest problems for all inside and outside this sector, which provides the daily bread and butter for thousands of employees all over the world.
Awards to the most excellent and new members of the WPC Board
While the price of oil was reaching historical records and the problem of sustainability along with that of being respectful with environment still to be solved, this more than centenary industry paid tribute to those most prominent professionals related to the oil sector in particular and the energy sector in general.
Al-Naimi, Minister of Oil and Mineral Resources of Saudi Arabia, received the Dewhurst award to the whole professional career.
The Excelence Awards were delivered to the winners at the innauguration ceremony (see the list of this year finalist for the recognition to the most ‘excellent’ companies on the links included at the end of this report).
The Award for the Young Authors went to Jaime Turazzi (Petrobras -Brazil-). Laura Watt (Accenture -UK-) and Jifeng Liang (China National Offshore Corporation -China-) were 2nd and 3rd.
This recognition, created by the Spaniard organisation of the WPC, rewards the best editorial works, written by professionals in the sector under 35 years old and was delivered by Juan Bachiller (Vice President of the Spanish organizing committee).
During the closing ceremony, R. Gossen introduced the new members of the Board of the World Petroleum Council, among the applause of all the people at the ceremony.
Key Issues on the table
The industry also discussed on corporate social responsibility and sought in the new technologies answers to some problems such as pollution, access to new deposits, efficiency in production processes and improving the labour safety for employees.
Items like the research and technological advance as the only way to deliver a sustainable future of the industry; how to increase security and improve the labour conditions of workers; like how to retain and attract talented persons; how to make this industry attractive for young people and how to increase the number of women within the sector were some of the issues discussed, together with other equally important.
Among them, they were debated some aspects better known for the average consumer, as the rise in prices, the security of supply, the globalization of the gas market, sustainability, biofuels, respect for the environment and the commitment with society.
On the subject of globalization in the gas market, while Abdullah Sallat (Senior Advisor for the Ministry of Energy and Industry of Qatar) stated that the globalization progresses rapidly and Mohamed Mexiane (President of Sonatrach) said that the demand for gas in Europe would continue growing, Linda Cook (Executive Director of Shell) claimed for the signing of some new international agreements able to secure the supply.
The 3rd oil shock
Nobuo Tanaka, Director General of The International Energy Agency (IEA), thinks that we are experiencing the “third oil shock”. because the market had not seen a situation like the present one since the eighties. An increasing number of reports point towards an unstoppable rise in oil prices, which impact on current economic affairs and on consumers.
For Abdalla Salem El-Badri, Secretary General of the Organisation of Exporting Countries of Oil (OPEC), pointed that speculation controls 70% of the oil market, a “dramatic” figure. He added that because of this speculative fluctuation the economic impact has spread to other products and resources. He also believes that the oil market is “tight” at present and that this must change by 2009-2010. But with the increasing demand from emerging countries like China and India, it is necessary to produce 3.5 million barrels more than what is produced today.”The world is full of oil, what is needed is technology development in order to increase performance in the extraction of new oil deposits”, assured the Secretary General of OPEC.
Among the multiple causes that have made the prices of oil increase wild, the industry pointed to the migration of investment towards the futures market and to that of commodities, such as oil, due to the mistrust that the crisis has generated within financial markets. “Many investment funds have gone to the market of raw materials and to the futures market, due to the financial crack and to the price fluctuation of the dollar”, said Randall Gossen (President of WPC).
From the oil co. to the global energy supplier
The demand for gas, electricity and all kind of fuels grows wild, due to the development of the emerging economies, while palliating the global warming problem needs for drastic reductions of CO2 emissions.
Surrounded by this economical and natural environment, some of the most important oil companies tend to change into global providers of energy, both fossil and renewable. But not all of them.
“Many of them are reluctant to do so. Some don’t dare doing it, because the situation within the sector will make compulsory for the oil companies to carry out huge investments in infrastructure and technology in the coming years “… “The energy mix is multiple. There is no longer any dependence on petrol. So we tend to operate in several segments of the new mix “… “In any case, until 2009 or even beyond, it is not predictable that petroleum might be left aside as source of energy”.
Until it is found another energy source able to meet the demand at a lower price, this will not happen “. Jorge Segrelles, Director General of the Repsol YPF Foundation and Chairman of the Spanish Committee answered this way. Randall Gossen (Vice-Chairman of Security of Environment and Social Responsibility for Nexen and Chairman of the World Petroleum Council) told more or less the same.
Juan Bachiller, Vice President of the Spanish Committee spoke also of the need to change the energy matrix, calibrating the weight that each kind of energy source should have in the new mix. For Pierce Riemer (Director General of the World Petroleum Council), “it is possible that this could happen in the long term” – he referred to the transformation of the oil company into an energy supplier-.
Changing the mix and CO2 capture, against global warming
For Nobuo Tanaka, Director General of IEA, climate change is the greatest challenge for the future: “it is essential to change our energy habits in order to cushion global warming”, and assured that the best solution should be directed towards investments that result in an “energy revolution” especially regarding the production and distribution of energy.
The Norwegian StatoilHydro and the Canadian Nexen agreed on the need to include the climate change in their sustainability programmes.
Helge Lund (President and CEO of StatoilHydro) stated: “both governments and the oil industry must take fast and effective actions in order to avoid acceleration of climate change”… “In 2030 energy demnad will increase by 55%, but also during this period of time CO2 emission will reach 57%”.
According to StatoilHydro executives, part of the solution to the problem mentioned above is to produce alternative energy as well as the increased use of natural gas as part of the energy mix.
The Norwegian Government thinks in the same way. This nordic Government awards, on one hand, incentives to citizens and companies to favour that they increase the use of natural gas. And on the other hand punishes CO2 emissions beyond the legal limit with an special tax. Thaks to this programme, pollution and damage to the ozone layer have been reduced.
EstatoilHydro has developed a technology that allows extract the CO2 that would be issued to the atmosphere in the energy production process. Once captured, this CO2 is injected and stored deep under the ground level, there where it comes from.
In the implementation of this kind of technologies it is worth mentioning the StatoilHydro joint project at Mongstad (Norway), the first refinery in the world that will come to reduce CO2 emissions in 1000,000 tonnes per year, when full operative.
Sleiper (North Sea) and In Salah (Algeria) are among many other plants of this Norwegian company in which it is already implemented with success a similar system at a reduced scale with regard tothe one at Mongstad.
Carbon reduction, but respectful with developing countries’ right to progress
Abdalla Salem El-Badri (OPEC) indicated in the OPEC meal on 2nd July that to achieve a true energy “decarbonization” revolution, the consumption of oil should be reduced by at least a 30% by 2050. However, even if this energy revolution occurs, this does not mean the end of society’s dependence on oil.
Al-Naimi, Minister of Oil and Mineral Resources of Saudi Arabia, and Dewhurst Award to the whole professional career, stated in favour of reducing emissions of CO2, but respecting “the legitimate aspirations of all the world’s people for greater prosperity, health and happiness” … “The challenge is clear. Can we simultaneously increase and broaden the economic prosperity and meet the world’s desire for mobility while making meaningful progress toward reducing our carbon footprint?. The answer is yes, we can!. And I believe the petroleum industry must be in the forefront of this effort”.
Success beyond forecast
According to data provided by the organization, a total of 14,500 people invited, of whom 500 are presidents and senior managers of their respective companies and 35, ministers in their respective countries, have taken part in the 19th World Petroleum Congress, held in IFEMA from 29th June to 3rd July. The slogan for this edition was “A world in Transition: Delivering Energy for Sustainable Growth”, and more than a oil congress, it could be considered as a energy congress, taking into account the approach and topics discussed.
The King of Spain attended the inauguration, together with Esperanza Aguirre (President of the Autonomous Community of Madrid), Alberto Ruiz Gallardón (Mayor of the capital of Spain), the Minister of Industry and Energy, Miguel Sebastián and other Spaniard authorities.
Around 4,300 delegates registered to take part at this congress and 550 journalists covered the event for 315 media from all over the world.
Image over the headline.- Logo of the 19th World Petroleum Council held in Madrid. © World Petroleum Council.
Related external links:
19th WPC, Awards to the Excellence in the Oil Industry (list of finalists)
