OPEC Secretary General Mohammad Barkindo made the announcement on Wednesday, December 8th, 2021, at the 23rd World Petroleum Congress (WPC) in Houston, Texas.
The Organisation of Petroleum Exporting Countries (OPEC) estimates that investments in the upstream, middle, and downstream oil industries will total $11.8 trillion between 2021 and 2045.
Barkindo presented at a plenary session titled “Energy Transition: Scenarios for the Future”
The impact of the COVID-19 pandemic, he said, was reflected in OPEC’s World Oil Outlook (WOO) 2021, which revealed that upstream capital investment declined by roughly 30% in 2020 as a result of the COVID-19 pandemic.
Speaking in the same congress the African Refiners and Distributors Association (ARDA), noted that the region also has to deliver “future refineries” in order to meet the continent’s expanding energy demands.
In a presentation, ARDA Executive Secretary Anibor Kragha stated that existing refineries will need to be modified to produce AFRI-6 or lower sulphur fuels in accordance with the organization’s plan.
ARDA had previously stated that upgrading the continent’s 36 current refineries alone would cost over $15.7 billion, with the problem being to guarantee that these refineries are converted into efficient centres of excellence.
Kragha stressed that Africa’s future refineries must be flexible and efficient, and that policies that create an investment-friendly climate, such as regulatory clarity and compliance standards, will assist the region attract much-needed capital for future world-class refinery projects.
Barkindo emphasising on reasons to back the investment plans claimed that the capital investment decline by roughly 30% in 2020 followed declines of 27% in 2015 and 2016.
“Investments have not recovered since a global level of 700 billion dollars was witnessed in 2014, and they were at only half this level in 2020.
“The return of investments is a core objective of the Declaration of Cooperation between OPEC and non-OPEC producers, which has done so much to return balance and stability to the market since the onset of the pandemic in early 2020.“
If the necessary investments are not made it could have knock-on implications, and leave long-term scars, particularly for security of supply, affecting not only producers, but consumers too”
He went on to say that the WOO revealed that by 2045, the share of electric vehicles in the whole road transportation fleet would be close to 20%.
However, he claimed that electric vehicles were not a feasible option to internal combustion engines for the majority of the world’s population, mostly due to cost.
According to the secretary general, global energy demand is expected to grow by 28% by 2045, highlighting the importance of taking a comprehensive picture of the energy industry and appreciating what each energy source has to offer.
Source: News Agencies