Middle East

Kuwait’s Hydrocarbon Industry and Energy Conversion

Reconnaissance Research held a special panel discussion with Alexandre LAVELLE, an international expert on energy policy, the performance of the oil industry, and its impact on the prosperity of the Gulf countries.

Many prominent special invitees from various economic and diplomatic sectors participated in the discussion. The dialogue, moderated by the Center’s founder and chief executive officer, Abdulaziz al-Angeli, requires a paradigm shift in the Middle East’s energy agenda to reduce its reliance on growing countries for hydrocarbon consumption. Revenue focused on various carbon net zero emission plans. It also focuses primarily on Kuwait.

What is the future of Kuwait’s hydrocarbon industry?

The resilience of Kuwait’s hydrocarbon industry depends on its ability to provide a national vision for the future of energy. Today, the country is navigating the changing sands of its new energy chapter. Creating a shared roadmap that spans four key themes requires a common agenda from all stakeholders throughout Kuwait.

From Oil to Energy: Future companies will leverage the entire oil and gas (O & G) value chain to deliver energy transformations and their structural impacts on supply, demand, energy mix and prices in a profitable manner. It is an integrated energy company that can do it. Future enterprises will need to consider reservoir potential, infrastructure performance, functional requirements, partnership strategies, energy efficiency improvements, and carbon-neutral standards.

Volume to Margin: Oil chain consolidation is the transition from an oil volume driven enterprise to an energy margin driven enterprise. Deploy an integrated state oil company (NOC) setup and look for cost savings, economies of scale, and agile continuity of Kuwait’s hydrocarbon chain.

From O & G Coordination to Energy Convergence: The Energy Vision is based on coordinating energy stakeholders through a common energy agenda to ensure the continuity of the energy value chain through coordination. Gas plays a vital role in energy convergence as a temporary fuel that can address the challenges of energy diversification in the context of global climate standards. Gas currently accounts for more than 50% of Kuwait’s energy mix and is expected to occupy a large share in the future through domestic gas production and imports of liquefied natural gas (LNG). Gas transforms Kuwait’s energy environment by integrating its energy value chain to achieve the optimal balance between affordable, reliable and sustainable energy.

From Carbon Strength to Carbon Neutral: Energy Sustainability was intended to achieve net zero carbon emissions by 2060 by managing the domestic carbon dioxide value chain and achieving net zero emission targets. We have established a foundation for Nationally Determined Contribution Contribution (INDC). Energy sustainability requires reducing Scope 1 and 2 emissions through green electrification, carbon capture and storage systems, and carbon offsetting.

What is the impact of this future on the economies of the Gulf countries?

The next stage of energy conversion is important for the prosperity of the Gulf countries and their hydrocarbon contributions. They will face the dual contradictory goal of supplying a sustainable demand for hydrocarbons while reducing carbon emissions.

For the hydrocarbon industry from the international community, carbon emissions through (I) accelerating the rollout of low-carbon technologies, (II) supporting carbon policies and regulations, and (III) increasing the share of renewable energy from the energy mix. There is a lot of pressure to reduce it. ..

Energy conversion is an inevitable shift to the story of traditional O & G companies, but countries need to develop a roadmap that takes into account specific operational conditions. The GCC NOC recognizes the impact of energy transitions on the world’s energy landscape and its regions.

The O & G production curve needs to be maintained through capital investment in infrastructure, new oil and gas development projects, and a unified energy transition pattern at the GCC scale. This blueprint needs to unite the Gulf countries around a common orbit in order to strengthen the region’s global position. According to the results of the 42nd GCC Summit, each Gulf country needs to contribute to a common pattern (criteria, convergence goals, roadmap) that can form a regional power / gas network. This is the first cornerstone to promote a more environmentally friendly area.

The state needs to allocate investment funds to the NOC to extend the field life cycle. + With 70 years of exploitation, the maturity challenge has naturally increased. There is an example of Saudi Aramco using a venture capital model to drive technology investment across the value chain and power generation. Saudi Aramco’s energy ventures have invested heavily in start-ups to rebuild the energy industry and accelerate O & G development in the Kingdom of Saudi Arabia.

Can you describe the challenges of Kuwait’s hydrocarbon industry?

The first is the turning point of field maturity. This is an inflection in the life cycle of an oil field due to years of development and changes in the state of the reservoir that require continuous intervention to maintain and extend the life of the oil field.

The second is the possibility of integration. The need for a common approach to measuring the performance of energy industry segments through an integrated energy chain. Harmonizing oil, gas and electricity is the first step in treating Kuwait’s energy system as one.

Third is the pressure from the Net Zero goal. The country has defined strategies to achieve ambitious climate goals. Kuwait has announced plans to integrate 15 percent of its renewable energy into its energy mix.A great reliance on hydrocarbons, coupled with Kuwait’s desire for energy, requires an efficient approach to hydrocarbon consumption with an overall strategy for electrification.

Fourth is the rarity of national champions. Developing future leaders is essential to Kuwait’s sustainability. Stakeholder management is an important factor that must be addressed. It requires a new generation of leaders who can predict future energy sector challenges.

Where does Kuwait stand in the energy transition?

Kuwait is in the early stages of its energy transition journey. From field maturity challenges to securing financial investment, we need to sketch an energy roadmap tailored to address the growing challenges of the hydrocarbon industry. Kuwait’s energy shift stems from strengthening the oil industry and extending it to the deployment of low-carbon technologies to meet the expectations of the global climate.

The purpose of Kuwait’s energy transition is to turn its energy production (mainly oil, from exploration prospects to chemicals) into a sustainable and profitable industry, taking advantage of its low cost oil. .. Energy transitions also need to strengthen Kuwait’s business integration, gain value throughout the value chain, and remain competitive as a low-cost and efficient operator.

How do you support Kuwait’s energy conversion strategy?

Kuwait needs to support the growth of funding for business prosperity. How? Creating a new industrial domain that attracts capital development. For example, the hydrocarbon industry needs to use solar energy instead of diesel consumption and the country’s grid supply to build its power generation capacity. Public-private partnerships are the foundation for improving the efficiency of the energy value chain. The private sector will build solar power plants and domestic operators promise to buy electricity at profitable prices.

Energy Market Growth: Promote Industrial Sustainability through Private Sector and Investor Participation

Refocus the current private sector on energy efficiency, carbon neutrality, low carbon technology, and cost savings.

Formalization of a new public-private partnership to power the operation of the energy sector and improve energy efficiency.

Participation in financial markets: Attract local and international financial institutions to project-specific opportunities

Secure investment to enhance private sector participation across energy efficiency themes covered throughout the O & G value chain.

Leverage industry credit ratings to fund energy efficiency opportunities beyond the private sector.

Alternative energy sources need to be integrated into one convergent energy chain. Predict the evolution of energy systems and their convergence with other value chains (…) to achieve the optimal balance between economy, security and sustainability. However, according to Thunder Said Energy, a leading energy technology research firm, this is a walk in the park, given that every $ 1 sold to fossil fuels needs to be replaced with $ 25 of renewable energy sources. Will not be.

Two key factors to consider when answering this question: Consumers: Kuwait needs to address local energy demands and identify new energy sources in order to minimize O & G consumption.

Exporters: Ensure maximum oil exports to support state revenues without jeopardizing hydrocarbon reservoirs.

post Kuwait’s Hydrocarbon Industry and Energy Conversion First appeared TimesKuwait..

https://www.timeskuwait.com/news/hydrocarbon-industry-and-energy-transition-in-kuwait/ Kuwait’s Hydrocarbon Industry and Energy Conversion

Show More
Back to top button