Adnoc sees opportunity in tackling climate change, CEO says
Dr Sultan Al Jaber, the UAE Minister of State, made an impassioned case for Abu Dhabi to be recognised as a regional leader in the battle against the risks of climate change to an audience of global chief executives and government officials at a forum in Singapore.
The chief executive of Abu Dhabi National Oil Company, speaking on a panel on Tuesday at the New Economy Forum organised by Michael Bloomberg, explained how the state-run company is the “spinal cord of the economy”. Adnoc is a founding partner of the New Economy Forum.
“Adnoc is a very advanced national oil company. We accept the facts and we come to terms with the realities on the ground. And yes, we do accept that climate change is real and is a serious challenge,” Dr Al Jaber said.
In order to meet this challenge “we have to work together in an ecosystem that involves all stakeholders”, he said. This inclusive message was in keeping with with the overall tone of the forum on its first day. Adnoc is creating the necessary partnerships to help mitigate climate change, he said.
“Therefore in Abu Dhabi and through Adnoc, we have instituted a zero gas flaring policy. We are advancing renewable energy, we were the first to deploy commercial scale carbon capture storage," Dr Al Jaber said. "Today we capture 800,000 tonnes of CO2 and transport it for enhanced oil recovery and we are embracing technology throughout the whole value chain of our business whether upstream, midstream or downstream.”
The UAE was the first oil producing nation and the first Opec member to sign the Paris accord, the pact struck among states in 2015 to accelerate and intensify the actions and investments needed to keep the global temperature rise below 2 degrees Celsius, he said.
“So I think we have clearly demonstrated our commitment to mitigating climate change and that will continue to be our main focus of our strategy in terms of our environmental stewardship,” Dr Al Jaber said.
He also highlighted the progress made by Masdar, the Abu Dhabi renewable energy company he is chairman at.
Dr Al Jaber also discussed Adnoc’s transformation, which began with his appointment as group chief executive in 2016.
Adnoc was able to take “a step back” and build on the experience of strategic partners like ExxonMobil and expand its evolution based on three pillars: human development, a clear Research and Development strategy and a technology roadmap, he said.
It has been an “enormous success”, he added.
Also on the panel in Singapore was Exxon's chief executive Darren Woods, who spoke of the company's commitment to collective efforts to thwart the effect of climate change. Exxon’s R&D includes participating in the science of climate change.
“Our perspective is we can contribute...we changed the processes in our plants to reduce emissions," he said, adding that the firm is using carbon capture and studying algae as a replacement fuel to help society.
However, Mr Woods said even if every car were to be electric, oil and gas demand would only drop to 2013 levels because of the growing chemicals and plastics industries, and that heavy duty transport has no substitute.
To combat industrial emissions carbon capture and storage are the most useful tools, he added.
Aliko Dangote, chief executive of Nigerian conglomerate Dangote Industries, said the demographics in Africa, where the population will double by 2050, created a huge opportunity. Mr Dangote said he was exploring how a company like his – relatively new to oil and gas - can co-operate with companies like Adnoc.
The industry is changing thanks to technology and new entrants and Mr Woods said it has a focus on technology and energy transition which has been an ongoing trend. Exxon invests $1 billion annually in R&D. It “brings people in who are science and engineering based” and Exxon ensures the workforce is motivated and given responsibility early.
In contrast, Josephine Wapakabulo, chief executive of Uganda’s fledgling national oil company Unoc, said that it has been building up a workforce from nothing but is finding it a challenge to attract talent who are drawn to international oil companies such as Exxon.