Saudi Aramco CEO says energy transition is failing

Author: EqualOcean News Mar 21, 2024 06:09 PM (GMT+8)

Saudi Aramco CEO Amin Nasser told the S&P Global Energy Conference in the United States on Monday that the energy transition is failing and that policymakers should give up the "illusion" of phasing out oil and gas as demand for fossil fuels is expected to continue to grow in the coming years.

Nasser noted that despite more than $9.5 trillion invested globally over the past 20 years, alternative energy sources have not been able to replace hydrocarbons on a large scale. Wind and solar energy currently account for less than 4% of the global energy supply, while the total penetration of electric vehicles is less than 3%. By contrast, the share of hydrocarbons in the global energy mix has only fallen from 83% to 80% in the 21st century. Global oil demand has already surpassed 100 million barrels per day and is on track to hit an all-time high this year.

Saudi Aramco is the world's largest oil production company and the world's sixth largest oil refiner, with operations in the Kingdom of Saudi Arabia and around the world, mainly engaged in oil exploration, development, production, refining, transportation and sales, and owns the world's largest onshore oil fields and offshore oil fields. Currently, Saudi Aramco is firmly implementing its oil and gas-focused development strategy, including: expanding its maximum sustainable oil production capacity to 13 million barrels per day (bpd) by 2027 from the current 12 million bpd, increasing its natural gas production by more than 50% by 2030, and increasing its crude oil chemical production capacity to 4 million bpd by 2030. At the same time, Saudi Aramco is investing heavily in low-carbon technologies, including carbon capture, utilization and storage (CCUS), ammonia and hydrogen, and renewable energy, to drive the country's green and low-carbon transition strategy.

Thanks to the strategic alignment of the Belt and Road Initiative with Saudi Arabia's Vision 2030, the relationship between Saudi Aramco and Chinese companies has evolved into a broader and more diversified strategic partnership that extends far beyond the supply of crude oil. , Saudi Aramco, through its wholly-owned subsidiary Aramco Overseas, acquired a 10% stake in Rongsheng Petrochemicals for RMB 24.6 billion, a significant acquisition both from the perspective of refining capacity and long-term crude oil procurement.

Nasser pointed out that as the prosperity of developing countries in the global South rises, this region, which accounts for 85 percent of the world's population, will become a new driver of oil and gas demand, as they receive less than 5 percent of the investment in renewable energy. In addition to renewable energy, the world should pay more attention to the area of "reducing oil and gas emissions", and "when new sources of energy and new technologies are truly ready, i.e., they are economically competitive and have the right infrastructure, then we should move towards adopting them."