For over 50 years now, BP Statistical Review of World Energy has been generating data on world energy trends and markets. Understandably, the data was being generated for company's own decision making, meant for internal consumption. Strategic decisions of the company were apparently based on this generated and compiled data. However, for the last few years, BP has begun releasing its energy outlook for public consumption too. The current outlook, released early this year, is only the second time that such a compilation has been released for public consumption too.
And to present the BP Energy Outlook 2030 and Review of World Energy released in January this year, the compilers have been traveling all around the globe. Last time it was BP Chief Economist Christof Ruhl who traveled to Riyadh, presenting its energy outlook. This year it was the turn of Mark Finley, general manager, Global Energy markets, BP, to be in Riyadh immediately after the IEF Ministerial in Kuwait to present the 2012 compilation before a select gathering of diplomats and analysts at the IEF Secretariat in Riyadh.
And Finley had interesting comments to make.
The compilation also confirms some of the established fuel trends too. The BP outlook underlines that despite the rapid projected growth in the renewable sector, fossil fuel would continue to dominate the energy mix by 2030. By then, 80 percent of energy would still be of fossil origin. It also confirms that though oil consumption is seen to be growing over the period, yet at the slowest rate it is continuing to lose market share, whereas gas and hydro are projected to make significant strides over the period both in absolute and percentage terms.
BP said natural gas is projected to be the fastest growing fossil fuel globally to 2030 at an average annual rate of 2.1 percent. Energy from coal will account for more than a quarter of total energy output by 2030. Renewables are also seen as growing at a healthy rate. Energy produced by wind, solar and other renewable sources will grow by fourfold by 2030, but this clean-energy sector will account for only a small fraction of total output, a BP report said on Wednesday.
Renewable energy, excluding hydropower, will total 860 million tons of oil equivalent (Mtoe) by 2030, accounting for around 5 percent of the world's total energy production of 16,605 Mtoe. In 2010, renewable energy production totaled nearly 159 Mtoe or just over 1 percent of the global total, data from BP's Energy Outlook 2030 showed.
Finley also came out with another startling projection: Most consumption growth would not be coming from transportation sector by 2030, as is generally perceived, rather from the power sector. Energy efficiency is bound to improve over the next two decades. In the transportation sector, improved internal combustion engines with hybridization would play a significant role in improving the efficiency in the sector, he added.
BP in its latest annual outlook also underlined that the growth of unconventional energy supplies, including shale gas and tight oil in the US, Canadian oil sands and Brazilian deepwater production, will make the Western Hemisphere close to completely energy self-sufficient by 2030. In fact, according to our 2030 outlook, because of the explosion of gas production in the US and in North America generally, and because of production improvements from oil sands in Canada and shale oil and deepwater in the United Sates, we have North America becoming energy self-sufficient by 2030, the presentation asserted.
However, major Asian countries would continue to be dependent on imports, mainly from the Middle East. Chinese requirement would continue to grow over the years, yet the growth rate would go down. However, 80 percent of Chinese requirements would still have to be through imports, the BP report pointed out.
In response to a question, Finley underlined the possibilities of production growth in the region. In case the right scenario could be created, Iraq alone has the capacity to jack up production to about 10 million barrels per day. Yet he cautioned that though theoretically that could be possible, yet in actual, in view of the ground realities, one should not expect a production of around 5-6 million bpd in the near future. Frankly speaking, even that would be a huge success for the beleaguered Iraqi oil sector, one can't refrain from adding.
The BP Energy Outlook 2030 also indicates that despite the growing lip service to climate issues, in actual the issue would be moving down the policy agenda. The world's dependence on fossil fuels such as coal and natural gas means global carbon dioxide (CO2) emissions will rise to levels "well above" what science says is needed to avoid runaway climate change, the BP report said. BP projected a 28 percent increase in global CO2 emissions by 2030. Last June, it estimated 2010's global CO2 emissions at around 33 billion tons.
With countries like Maldives facing extinction, extreme climatic changes becoming a norm rather than exception, this could definitely be a recipe for disaster. World leaders, especially the industrialized world needs to look at this aspect more seriously, one can refrain from underlining.
Subsidies and efficiency remain an issue in exporting countries, the report suggested. In countries where subsidies were removed or reduced such as Iran, fuel consumption declined and efficiency improved, Finley said in his presentation. The galloping fuel consumption in the Kingdom too is a stark reminder that efforts are required to boost efficiency and curtail consumption. The current consumption growth in the Kingdom is a cause of concern to policy planners and Finley referred to this issue in his presentation in a rather subtle, guarded tone.
Concluding the presentation, he was forthright, crisp and to the point - there will be no dearth of fuel in the foreseeable future. "We at BP do not believe in peak oil theory. Competition, innovation and regulation is to make affordable energy available in the foreseeable future," Finley asserted. And this was definitely music to ears.
© Arab News 2012
