 |
World energy challenges: Endurance and commitment
Remarks by Rich Kruger
President, ExxonMobil Production Company
IPTC 2009
Doha, Qatar
December 7, 2009
Your Excellencies, fellow panelists, distinguished delegates, it is a pleasure to be here in Doha at this important event.
My company is proud of its more than 15 years of partnership with the State of Qatar and Qatar Petroleum. And, we are honored to play a role in Qatar’s impressive rise.
We salute the Qatar National Vision 2030 launched by His Highness the Emir. We are pleased to take part in supporting its four pillars of human, social, economic and environmental development.
It is fitting that we discuss commitment and endurance in this country that impressively demonstrates these virtues in helping to meet the world’s energy needs.
Qatar’s vision and leadership serve as an example of what can be achieved through teamwork, innovation and technology, and an example that testifies to the power of international partnerships.
Endurance and commitment are more than just words and require more than just periodic expressions of support. In our industry, they demand a belief in time-tested fundamentals such as investment discipline, operational excellence, cost control, technology application and people development. Commitment and endurance are foundational concepts because of the long-term nature of our work.
Today our industry must commit to taking on the dual challenge of meeting the world’s growing energy needs while reducing the growth of greenhouse gas emissions.
But our commitment to this dual challenge is simply the first step. It defines our purpose and sets our direction.
It is our endurance that will enable us to carry through with the commitment. And time and time again, our industry has demonstrated that it delivers on its commitments.
That said, meeting the world’s enormous and growing energy needs is no small commitment.
The International Energy Agency and many others predict that the world’s total energy demand will increase significantly; by as much as 30 to 40 percent in 2030 versus 2007.
Growing populations and developing economies will require more of the energy we produce today and the energy we will be expected to produce tomorrow.
Increasing energy demand will mean that hundreds of millions of people will achieve higher standards of living. They will live safer, healthier lives filled with opportunity. But it also means that our industry will face unprecedented challenges in providing the energy supplies that will enable improved standards of living.
This is where our endurance will help deliver on our commitment.
Today, our industry is dealing with challenges brought on by the global economic downturn. The downturn has temporarily reduced energy demand, reminding us once again of the correlation between energy and growth.
Many in our industry are pausing, re-examining strategies, cutting investments and cutting people. Many outside our industry are suggesting it is a time to worry, a time to abandon long-term plans, and a time to dismiss the fundamentals.
But our industry has faced significant challenges before. And each time we have shown that the key in times like these is to maintain a long-term view and focus on the fundamentals.
History tells us that now is not the time to lose heart but rather an opportunity to strengthen and prepare for the future.
We must once again re-affirm our commitment to the long-term. How? By making disciplined investments to increase energy supplies, developing technologies to support future growth, and developing people and organizational capabilities.
Ours is truly a commodity business. As such, we are subject to the ups and downs of the marketplace. We expect it. We plan for it and we have experienced it before.
Within ExxonMobil, we are demonstrating our commitment and endurance by pursuing plans to invest $25 billion to $30 billion annually over the next five years on energy projects.
These are record investment levels for us. We are able to confidently pursue these plans based on our long-term view of industry fundamentals, and financial discipline, in good times and bad.
Clearly, significant new industry investments will be needed. But what else will be needed? Good government policies.
The world will need government leaders willing to commit to stable fiscal and regulatory frameworks that will support long-term energy investments.
We will also need policymakers with conviction to ensure that energy policies are carried out and protected over time.
We know that with time, economic growth will return and energy demand will rise. With this understanding, it is important that we collectively continue to invest capital and human ingenuity into developing future energy supplies.
Meeting the demand challenge, of course, is matched by the environmental challenge.
As we look to the future, it is clear that the world will need to develop all sources of energy, hydrocarbon and other, when and where they are economically competitive.
With this perspective, the best way for us to meet future demand and help curb greenhouse gas emissions is to continue to invest in new technologies.
The energy industry is one of the most technologically advanced industries in the world. And now is the time to bolster our commitment to technology supporting integrated solutions that address the energy supply, security, efficiency and environmental goals we all share.
ExxonMobil is committed to technology. Over the past five years, we have invested nearly $4 billion in research and development.
Worldwide, we employ nearly 17,000 engineers and scientists working to develop energy solutions. They are focused on increasing energy efficiency in the short term, advancing proven emissions-reducing technologies in the medium term, and developing long- term breakthrough, game-changing technologies.
Technologies to increase energy efficiency are critical. Increased efficiency is effectively the single greatest new supply of energy that we have available to us today. We estimate that by 2030, the amount of energy saved through future efficiency gains will be equivalent to about 145 million barrels of oil a day.
Technologies are also helping us bring new supplies to market, with increasingly less impact on the environment.
One particularly promising technology is carbon capture and sequestration, or CCS. When the three primary phases of CCS — capture, transportation and storage — are fully integrated into power plants and industrial facilities, we can truly achieve meaningful emissions reductions.
Advancements in CCS have the potential to make an impact on a global scale. However, current technologies to separate and capture carbon dioxide are cumbersome and expensive.
Our scientists and engineers have spent more than three decades researching, developing, and applying technologies to help make CCS more viable. And we are making strides.
But as we advance new technologies such as CCS, it is important to remember that energy solutions cannot be created in a vacuum, given issues of size, scope, and cost.
We need to think on a long-term and on a global scale while at the same time remaining committed to working the short-term, incremental advancements necessary to help get us there.
In summary, our future success will be determined by how well we come together and endure — industries, governments and people from all over the world — with a shared commitment to a brighter energy future.
Thank you for your attention.
