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Global energy sector requires investment of $ 12.6 billion by 2045 – OPEC

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Global energy sector requires investment of $ 12.6 billion by 2045 – OPEC

By Edith Ike-Eboh

The Organization of the Petroleum Exporting Countries (OPEC) says the global energy sector requires an estimated $ 12.6 trillion in cumulative development investment by 2045.

OPEC Secretary General Dr Mohammad Barkindo made the disclosure while delivering a speech at the 14th Annual Nigerian Association for Energy Economics (NAEE) Conference in Abuja on Wednesday

The theme of the conference was: “Strategic Energy Sector Responses to COVID-19: Impact on African Economies”.

He said oil will remain relevant for global economic growth and development.

“It is vital for us to remember that oil will remain the biggest contributor to the energy mix until 2045 with over 27%, according to OPEC’s latest World Oil Outlook.

“Renewable energies are developing the fastest, but at the same time the global economy is about to double and all the resources will be needed to meet this growing need.

“A cumulative investment of $ 12.6 trillion in upstream, middle and downstream is crucial through 2045 to meet this need,” he said.

According to him, investments in 2020 fell by more than 30% in the face of COVID-19, even worse than the dramatic declines seen during the severe downturn in the industry in 2015-2016.

He said the risk to energy security that would result from insufficient investment would have a huge impact on both producers and consumers.

He noted that developing oil-producing countries, such as Nigeria, would be particularly affected.

“History has shown that energy insecurity is accompanied by economic insecurity and geopolitical instability.

“All OPEC members, including Nigeria, will need to rethink their strategy to maintain their position in the new global energy mix, including focusing on economic diversification.

“Oil-producing countries, and especially African countries that depend on oil and gas production for their income, need to create an investment-friendly climate – to this end,” he said.

He noted that the Petroleum Industry Bill (GDP) promised to be a huge success in reviving the fortunes of the oil and gas industries in Nigeria.

He said the reduction in foreign direct investment in African industry could be catastrophic for many countries and peoples.

He said OPEC was concerned about increasing pressure on the oil industry from many sides, including policymakers, as well as investors.

“Even within the boards of the oil majors, there is great pressure to seek policies and initiatives that could have a drastic negative effect on oil-producing countries.

“Oil is the lifeblood of our country, so the importance of this issue cannot be underestimated,” he said.

On the energy transition, Barkindo said oil has a powerful role to play in the energy transition, and that it should not be swept under the rug on the basis of old credentials.

He noted that with the help of technology, the industry can become low-carbon or even zero-carbon.

“This includes technologies already implemented such as carbon capture, use and storage.

“In addition, great strides have been made in terms of efficiency gains in the industry, all along the production chain.

“It is essential to compare the lifetime benchmarks of each energy source in terms of emissions.

“For example, electric cars may appear cleaner, but emissions are buried in many industrial processes necessary for their production.

“We applaud Nigeria’s goals of reducing carbon emissions while pursuing the United Nations SDGs, which aim to ensure access to affordable, reliable, sustainable and modern energy for all.

“The transition to a low-carbon energy future may appear to work against the socio-economic benefits of energy, especially for energy-poor countries.

“Nigeria is trying to meet this challenge head-on with the strong promotion of solar and wind power and the expansion of the use of natural gas,” he said.

Regarding the impact of COVID-19, the OPEC scribe said the global oil sector was the most affected but on the road to recovery.

“We have all been impacted by the COVID-19 pandemic over 2020 and 2021. It is an unprecedented event for the global oil industry and the global economy.

“No country or citizen of this planet has gone unscathed and the pandemic continues to eclipse 2021 as it did 2020.

“However, developing oil-producing countries have been particularly hard hit.

“They are facing a triple whammy; COVID-19 has crippled the economies of the poorest countries more than the richest, ” he said

He urged the NAEE to use the conference and come up with a solution to some major challenges facing the industry nationally and globally. (NAN) (www.nannews, ng)

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