Conference eyes sustainable development

Sept. 13, 1999
Worldwide energy consumption could rise by 60-80% by 2020, from about 200 million boed today to more than 300 million boed by 2020.

Worldwide energy consumption could rise by 60-80% by 2020, from about 200 million boed today to more than 300 million boed by 2020.

This was the prediction presented by Mark Moody-Stuart, chairman of Royal Dutch/Shell, to the Offshore Europe conference in Aberdeen Sept. 7. He added that, at that time, developing countries would account for more than half of the world's energy.

Moody-Stuart told delegates the worldwide trends towards tighter environmental controls and sustainable development would affect the energy industry in three main ways: energy markets will become increasingly complex and competitive; energy prices will remain volatile and tend to decline; and society will demand more from energy companies.

"On the one hand," said Moody-Stuart, "there is the likely slowing-possibly decline-of OECD (Organization for Economic Cooperation and Development) demand, caused by structural change, saturating markets, aging populations, and increasing energy efficiency.

"On the other hand, there is the potential demand in developing countries. How it is fulfilled will depend on economic growth. We can't take that for granted, but we can be optimistic that better economic management and faster learning will boost development."

Global fuel mix

Moody-Stuart said that consumption of liquid fuels should continue growing, while natural gas consumption could more than double by 2020, and renewable energy sources should become increasingly competitive.

"The major impact of renewables seems likely to come after 2020," he said, "but it is easy to underestimate the pace of change. Their growth may well surprise."

In the meantime, Shell believes that extending the use of natural gas will be the most important means of reducing greenhouse emissions over the next 20 years, as hydrogen, solar, biomass, and wind power are made commercial.

While Shell is building its solar and biomass power business in readiness for the blossoming of renewables, it sees deepwater production and gas market developments as core areas for expansion.

"Building gas businesses means grasping the opportunities of liberalized markets," said Moody-Stuart, "and we are pursuing new competitive opportunities.

"The hydrogen fuel cell engine is one. Shell technology could be the basis for reforming hydrogen from gasoline in cars or from gas in service stations. Market penetration would be enhanced by using existing distribution infrastructure."

Moody-Stuart added that Shell companies had pledged to reduce their own greenhouse gas emissions to 90% of their 1990 level by 2002, which is double the Kyoto protocol target and 5 years in advance of it. He said Shell was on track to be 17% below 1990 emissions levels by 2003.

"Tackling these emissions," said Moody-Stuart, "in an expanding world is a huge undertaking, requiring us all to change how we live and work, how we produce and use energy. The drive and creativity of those who work in this industry will be decisive."