Speaking at the World Economic Forum in Davos, Switzerland, Amin Nasser notes that Saudi Aramco continues to drive and position itself for the future in terms of lowering carbon emissions while maintaining its competitive advantage when it comes to cost. The company was lauded as “an exception among its peers” during a panel debate at the forum.
Saudi Aramco’s greenhouse gas emissions efficiency was described by Christiana Figueres, the former leader of the landmark 2015 Paris Agreement, as “an exception among the peers” during a live streamed panel debate on the global energy transition with president and CEO Amin Nasser at last week’s World Economic Forum (WEF).
The significant acknowledgment from the former U.N. Framework Convention on Climate Change executive secretary included the company’s pioneering methane management: “Aramco is taking the lead on that (methane), but not everyone else is doing it,” said Figueres, known for speaking her mind.
Figueres’ comments were well-earned recognition for the training and committed diligence of Saudi Aramco employees toward best-in-class operational management, and Nasser emphasized that the company wants the “carbon footprint of everything that we do” to be the lowest.
“We continue to drive and position ourselves for the future in terms of lowering our carbon emissions, and maintain our competitive advantage when it comes to cost,” said Nasser.
When compared with CO2, methane gas is 80 times more harmful to global warming in the first two decades after its release, and Saudi Aramco’s 0.06% methane intensity is one of the lowest in the industry, while the company’s upstream carbon intensity is one of the lowest in the world at about 10 kilograms of CO2 equivalent per barrel of oil equivalent.
Each year, WEF invites approximately 3,000 of our planet’s most influential leaders to gather in Davos to collaborate on international issues, and amid rises in carbon emissions during 2018 with a similar rise expected for 2019, concerns about climate change and sustainability dominated this year’s 50th annual conference.
Energy transition — A Dual Solution for a Dual Challenge
Delivering more, but cleaner, energy with less emissions to the world’s growing population — as well as the nearly 1 billion people with no electricity access — is a dual challenge of “more with less.”
Nasser said demand for renewables, electrification, and alternatives will increase by 2040, but he cautioned against the simplistic view that a transition to a cleaner energy can occur overnight.
He said transitioning was dependent upon affordability: “It takes a lot of financial capability that might not be available for all countries,” adding that meeting the world’s future energy demands will require traditional and newer energy sources to work together to meet future demand.
The panel discussed renewables and gas as a dual solution. “We use renewables as the backbone,” said Figueres, adding that gas is then used to firm up renewables “because they are not 24/7, 365,” and commenting that using renewables rather than “pulling the grid all the way out” to an isolated poverty area makes more financial sense.
“It is not oil and gas that are a problem, it is the emissions from them,” she said.
According to International Energy Agency executive director Fatih Birol, one-third of all the world’s CO2 emissions came from coal power plants.
Adding that coal-fired plants were often the “No. 1 source of electricity generation in low income countries,” he advised that energy was not an issue that could be easily simplified, and that “Western-centric discussions” were wrong from both an ethical and climate point of view. Energy is a very serious complex business, especially in developing countries,” said Birol.
With close to 3 billion people still relying primarily on biomass and kerosene for cooking, Nasser said, underdeveloped countries should not be lectured on delivering affordable electricity to their people.
He added that changing coal-fired power with gas would result in a “huge reduction in carbon emissions,” and his view of the energy transition would be multi-speed, driven by a country’s geography and development curve.
World’s Oil Consumption to Remain to 2040
Today’s oil consumption is 100 million barrels per day, and Nasser said that growing population, an emerging middle class, and lifting countries out of energy poverty means demand will continue at this level for another two decades.
“There will be additional demand,” he said. “And the only way you can meet it is by making sure that you continue to provide affordable, reliable, ample, energy to the rest of the world.”
Siemens president and CEO Joe Kaeser said rising energy demand has brought millions of people in the world out of poverty. He said that the future lay in renewables, Kaeser urged cooperation: “We have got to work together. This is something which concerns everybody.”
Part of CNN’s Global Energy Challenge feature series, the panel provided a timely and realistic perspective to the global energy transition debate, and firmed consensus that hydrocarbons will be necessary to promote development and growth in developing countries.
The panel was moderated by CNN’s John Defterios, who remarked it was the “healthiest” energy transition debate so far.
More than a Petrol Pump
Displayed to an “Art of Possible” theme, a Saudi Aramco exhibition stand highlighted the company’s investment in energy technology, global research and development commitment, and its awareness of climate change.
Using the most powerful reservoir simulation algorithm in the world, TeraPOWERS, visitors were immersed into a 3-D 5,000 foot journey below ground into an oil field.
Transparent LED screens told the story of inspiration to commercialization, while other displays included the Fourth Industrial Revolution Center, flaring minimization, and the company’s realistic research about how to truly reduce carbon emissions from the light-duty transportation sector.
WEF was founded in 1971 by executive chairman Klaus Schwab, who originated the term Fourth Industrial Revolution. This year’s event was held for four days from Jan. 21-24 under the theme of “Stakeholders for a Cohesive and Sustainable World.”
Later this year, Riyadh will host a WEF meeting under the banner of the Center for the Fourth Industrial Revolution.