The Organisation of Petroleum Exporting Countries, OPEC, has predicted that renewable energy will record fastest growth rate between now and 2040.
In his keynote address delivered at the 5th Kuwait Oil & Gas Show. Theme: “New Energy Era: Transformation, Diversification and Integration”, 16 April 2018, Kuwait City, Kuwait, OPEC Secretary General, HE Mohammad Sanusi Barkindo, stated that: ‘’Renewables are projected to record the fastest annual growth rate, averaging 6.8% per annum in the period to 2040.
‘’However, by 2040, the combined contribution of renewables, hydro, nuclear and biomass are expected to account for just 26% of the global energy mix, an increase of 7% from today.
‘’In terms of oil and gas, combined they are still expected to provide more than half of the world’s energy needs by 2040, with their combined share relatively stable between 52–53% over the almost 25-year forecast period.
‘’In terms of oil, we expect it to reach over 111 mb/d by 2040, an increase of around 15 mb/d. We are expected to hit 100 mb/d during the course of this year, much earlier than initially forecast. On top of this, we should also remember that oil producers and companies must invest heavily simply to offset the impact of natural decline rates, which is annually around 4 mb/d.
‘’For oil, it means that there is no expectation for a peak in oil demand over the forecast period to 2040. This is not only the projection of OPEC, but the International Energy Agency (IEA) too.
‘’To put this into an investment perspective, in the period to 2040 the required global oil sector investment is estimated at a huge $10.5 trillion. This also needs to be placed in the context of the fact that globally more than a trillion dollars of frozen capex or cuts were witnessed during 2015 and 2016.’’
He stated that: ‘’In this regard, I commend Kuwait and its able and visionary leadership for its laudable investment plans announced earlier this year for the country to spend more than half a trillion dollars by 2040 to boost its oil and gas output and refining capacity.
‘’This includes plans to more than double refining capacity by 2035 and to boost oil production to 4.75 mb/d by 2040. These developments are not only important for Kuwait, but they will be vital to the industry and consumers in the years and decades ahead. The longevity of oil as a desirable energy source can only be guaranteed by such bold and visionary investment plans.’’
Barkindo added: ‘’Thus, in looking ahead, we need to be realistic about what each energy source can provide, and continually look to transform how we extract, process, supply and use all the energies needed in the future.
‘’This should not only be through the concerted and continued development of renewable energies. It also needs to be through the development of technologies in the oil & gas industry to enhance efficiencies, in both production and use, streamline working practices, and further improve their environmental footprint.’’