A global realignment of the energy industry is needed to accelerate the move to renewables and, in some cases, skip a period of economically maximising the recovering factors of the existing global basins to attain net-zero emissions.
Experts believe that at least half of the world’s energy demand will be met with fossil fuels through to 2050 with a minimum annual investment of $350-400 billion. The zero-emissions transition will cost up to $40 trillion in global commitment and must be largely fuelled, in the midterm, by continued investment in fossil fuels as there is no cheaper alternative to finance this movement while satisfying the world’s energy needs.
As coined by the United Nations, sustainability refers to “meeting the needs of the present without compromising the ability of future generations to meet their own needs” defined through three interconnected pillars of environment, economic and social. We cannot ignore the economic and social in favour of the environment or vice versa. There must be balance and a well thought out transition.
The last five years have put a tremendous and disproportionate economic burden on the energy supply chain sector. Ironically, it is this imbalance that has proven this sector to be the most resilient and best catalyst to innovation around maximising the world’s energy needs. These supply chains will be the most efficient engine and quickest way to drive a true, natural transition to alternative energy while utilising the safe use of our remaining hydrocarbon reserves. These goals are not mutually exclusive of each other and, in fact, are mutually inclusive.
The UK’s North Sea Transition Deal is a step in the right direction. For Scotland, although it sounds counter-intuitive, it would be smart to enhance fossil fuel reserves that are needed in the open market to achieve the net zero goal by accelerating investment in these supply chains, not cutting it. We cannot just turn off the industry and switch over through regulation and consortiums. A precise amalgamated strategy which promotes both the move to alternative energies and delivers the most efficient and clean recovery of our current reserves, would be the most prudent. Lower economic growth in our region cannot co-exist with a rigorous low-emissions strategy.
It is imperative to reduce emissions. The knowhow, ingenuity and skills required to do this are already available in our most resilient energy innovators – the oilfield supply and service sector.
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