By David Paganie, Chief Editor
While pressure continues on the oil and gas industry to step up investments in renewables, energy ministers and international operating company executives are pushing back…to an extent. The primary opposition from the industry is the expected pace and level of investment. ExxonMobil’s recent energy outlook projects that oil and gas will continue to make up greater than 50% of the world’s energy mix in 2050. Considering the natural depletion rate of an oil and gas field, new investments will be needed keep pace with demand. And the speed of the transition will vary by region, as it will be dictated by national economic conditions and ambitions.
Leaders of some of the world’s largest energy-consuming nations recently assembled at this year’s Gastech conference in Houston to discuss their perspectives on investing in hydrocarbons in the energy transition. India’s minister of petroleum and natural gas, Shri Hardeep Singh Puri, expressed his commitment to a “green” transition, but suggested that the pace of its transformation will be gradual as it relies heavily on fossil fuels. The country’s oil consumption is forecast to rise from 5.4 MMb/d to about 7 MMb/d by 2030.
Egypt is seeking to leverage technology and its domestic infrastructure to unlock the region’s natural resources. Part of the plan is to establish Egypt as an export hub for the region to facilitate development, according to Karim Badawi, Egypt’s minister of petroleum and mineral resources. Egypt is transitioning its energy mix as well, with a target of 42% renewables by 2030.
Türkiye, like Egypt, views natural gas as critical for domestic energy consumption and possibly for export to European markets. Alparslan Bayraktar, Türkiye’s minister of energy and natural resources, outlined three challenges for the nation: energy demand is growing; about 67% of its energy comes from imports; and it needs to develop its natural gas export capabilities.
The ongoing development of the Sakarya field in the Black Sea may enable Türkiye to become an exporter of natural gas. The field, the largest in the Black Sea, is in a second phase of development which is expected to boost production by an additional 30 MMcm/d by 2028. Sakarya holds an estimated 18 tcf of proved and probable gas resources. Meanwhile, Türkiye aims to grow renewables as part of its energy mix.
Nigeria is also committed to natural gas to drive its national economy, according to Ekperikpe Ekpo, Nigeria’s minister of state for petroleum resources. The country is ramping up its gas production as well as domestic pipeline infrastructure. Ekpo referenced the OB3 pipeline, which is designed to move 2.2 bcf of gas through an 1,800-m pipeline across Nigeria. This is a long-delayed pipeline project which has been bedeviled by a complicated subsea segment. But, it is reportedly expected to deliver first gas this year. Nigeria is also investing in hydrogen, solar, and nuclear power.
Libya is eyeing a new bid round for oil and gas leases in late 2024/early 2025, as a means of encouraging international investors to help increase its domestic production.
While the exact terms of the round are unknown, Libya’s newly appointed minister of oil and gas, Khalifa Rajab Abdulsadek, is promoting the upcoming investment opportunities. He pointed to the country’s wealth of natural resources and improving fiscal terms as incentives to participate.
The upcoming bid round is intended to support Libya’s goal to double its domestic production over the next 3-5 years, to about 2 MMb/d. But an estimated $4 billion in local infrastructure improvements will be required to achieve this target, according to a recent report by Wood Mackenzie.
International investors in oil and gas have largely avoided Libya in recent years, due to its challenging fiscal terms and regional geopolitics. But, Eni has been one of the exceptions. The operator launched the development of two gas fields, Structures A&E, offshore Libya in 2023. The combined gas production from the two structures is expected to start in 2026 and reach a plateau of 750 MMcf/d. Libya’s upcoming bid round for oil and gas leases will be its first since 2005.
