Editorial comment
The ‘paradox of petroleum’ – where the threat of climate change clashes with the global demand for petroleum-based products – defines the current energy landscape. It also forms the title of a new special report from DNV, which presents the results of a survey of nearly 450 senior oil and gas professionals.1 The report notes that the petroleum paradox, at its core, is a “paradox of transition – of how fast the world can make a secure, global, and equitable transition to a low-carbon future.”
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As we all know, the oil and gas sector is facing unprecedented challenges as it seeks to find the right balance between meeting the world’s immediate energy demands and advancing towards decarbonised energy systems. It is encouraging to read that 64% of oil and gas industry leaders surveyed by DNV believe that the pace of the energy transition is accelerating, while 61% are planning increased investment in decarbonisation. However, significant concerns linger. For example, just over half of executives (51%) believe that global investment in new oil and gas capacity is insufficient, with those in North America particularly worried (70%). Meanwhile, the leading challenge to prioritising renewable and cleaner energy sources, as cited by 49% of respondents, is low financial return or profitability associated with these initiatives. Other key barriers include the constraints posed by existing business models and unclear energy or emissions policies.
What is clear is that the paradox of petroleum presents a very difficult balancing act, especially given recent concerns over energy security. However, it is a challenge that the energy sector must be ready to face head-on in order to effectively support the energy transition. Interestingly, 74% of survey respondents said that oil and gas companies should play a leading role in accelerating the energy transition, while just 55% said that their own organisation is actively adapting to a less carbon-intensive energy mix. DNV’s special report goes on to suggest that low-carbon innovations and digital technologies are the twin forces that are driving the sector’s transformation. Aside from investments in the likes of wind, solar, hydrogen, biofuels and CCUS, digital technology is helping to drive efficiencies to make the sector leaner, cleaner, and smarter.
The relationship between digital innovations and sustainability is explored within this issue of Hydrocarbon Engineering. Starting on p. 53, Emerson explains why digital innovations will be key for organisations that are aiming to improve sustainability and performance, while Seeq Corp. (p. 57) examines how modern advanced analytics solutions can help process manufacturers to reduce emissions and increase operational efficiency. This issue also includes a keynote article from Euro Petroleum Consultants (EPC) that considers the downstream sector’s energy transition journey (p. 10). The article’s author, Miro Cavkov, argues that in order to achieve its targets, the sector must foster greater connectivity. This can be achieved through articles in magazines, such as this one, as well as other initiatives that allow industry professionals to share knowledge and keep up-to-date with the latest technology and project developments. And on that note, I would like to invite all of you to join us for our inaugural ‘World Energy Transition Conference’, taking place on 5 September 2024. This virtual conference will bring together professionals in the downstream sector to learn about the challenges and opportunities presented by the transition to a low-carbon energy future. Register for your free space here: https://www.accelevents.com/e/worldenergytransition2024.
- ‘The paradox of petroleum - How the oil and gas sector is transforming through uncertainty’, DNV, (June 2024).
