The Growing Confrontation Between Energy Security and Climate Change Policies
In the “Age of Energy Supply Anxiety” concerns about energy security have stimulated a global scramble to secure oil and gas resources. In addition to fostering a high and volatile oil and gas price environment, the anxieties are accompanied by significant changes in the competitive landscape that challenge the industry’s ability to develop oil and gas resources in pace with demand. Challenges with respect to this scramble for resources and energy security include:
- Increasing state control of oil and gas resources
- Elevated political risks and uncertainties in key producing countries
- Soaring costs accompanied by shortages of rigs, crews and materials
- Increasing anti-hydrocarbon actions and climate change policies
North American E&P is impacted by these global factors and must cope with a daunting paradox whereby regulations and policies to address environmental and climate change concerns increasingly override energy developments that are critical to fuel our economy. At a time when increased drilling is required to even sustain domestic gas production, regulations and legal actions impede access to resources on the one hand and also deny permits to expand LNG imports on the other. Even though Canada’s oil sands provide secure and growing oil supplies both Canadian and U.S. climate change initiatives propose substantial greenhouse gas emission controls that could impede the growth of these critical supplies. Companies are adopting manufacturing approaches and streamlining their business processes to optimize unconventional oil and gas developments while also reducing environmental impacts across the supply chain. New technologies are critical to improve recoveries, efficiencies and deliverability while reducing emissions and the environmental footprint. Even though the U.S. did not sign the Kyoto Accord climate change has captured the political mind share and legislation to impose substantial carbon reduction goals is emerging. The petroleum industry has successfully implemented collaborative practices to address local and regional community and environmental concerns. Similar collaboration is needed to balance energy requirements with national and global climate change policies. This presentation will examine these competitive trends and challenges and their impacts on US E&P industry operations.
Location:
Petroleum Club, 43 Floor, ExxonMobil Building
800 Bell Street
Houston
,
Texas 77002