Dr. David J. O’Reilly was elected Chairman of the Board and Chief Executive Officer of Chevron Corporation in January 2000. A Chemical Engineer, he started his career with Chevron Research Co. in 1968. Dr. O’Reilly is a director and a member of the Executive Committee and Policy Committee of the American Petroleum Institute and a member of various national and international councils, including the World Economic Forum, National Petroleum Council and the Trilateral Commission.
Chevron, a strong supporter of the IEF and the IEBF, has participated actively in the Joint Committee of representatives of industry that has advised 2nd IEBF Host and co-hosts on 2nd IEBF Host and co-hosts on themes and agenda for the Doha meeting of Ministers and CEOs and has given generous financial support to the activity of the IEF Secretariat.
Dr. O’Reilly outlines in this special article for the Ministerial elements for a co-operative framework for global energy security, which includes use of the IEF to continue a substantive producer-consumer dialogue.
Energy security is one of the most critical issues facing the world today. With the world’s population expected to grow by 1.5 billion people over the next 20 years and worldwide demand for energy to grow by more than 40 percent in the same period, delivering reliable, affordable supplies of energy is one of the biggest challenges we face as an industry and as a global community.
Meeting this growing demand for energy, which is unprecedented in the world’s history, will require a robust response from all parties in the energy value chain – NOCs, governments, IOCs, and consumers. It must be a multilateral response. There are few industries as global, and as interconnected, as energy. Success in addressing energy challenges will come not from isolation, energy “independence,” or unilateral, nationalistic energy policies. In an interconnected marketplace, sustained success can be significantly enhanced through cooperative partnerships.
We are seeing the fruits of cooperation and partnership around the world, particularly in the Middle East. They include the Kingdom of Saudi Arabia’s leadership role in maintaining robust production to help stabilize global markets; the massive investments in GTL infrastructure in Qatar and other countries to create a new generation of ultraclean energy; and new oil and gas exploration openings from the Gulf to North Africa.
To create true global energy security we need to collaborate on a framework in which cooperation and partnership can continue to flourish. The fundamental elements of this framework should include:
· Open markets. We need to enhance the free flow of capital and investment, and the sharing of transparent, detailed data on supply and demand. The Joint Oil Data Initiative is a good step in the right direction.
· Sound policies. Governments should provide predictable, secure fiscal and regulatory regimes, balance supply security secure fiscal and regulatory regimes, balance supply security with demand security, and develop policies that recognize the with demand security, and develop policies that recognize the interdependency of global energy markets.
· Robust technology. We should continue investing in technology to conserve and optimize the resources we have technology to conserve and optimize the resources we have now while developing a full range of future energy sources now while developing a full range of future energy sources and mitigating the environmental impact of our industry’s and mitigating the environmental impact of our industry’s operations.
· Energy efficiency. This is the cheapest form of new energy we have at our disposal. We should focus on ways to capture we have at our disposal. We should focus on ways to capture new energy savings in transportation, power generation and new energy savings in transportation, power generation and facilities management.
· Responsible development. One of our biggest responsibilities as an industry, and as a global community, is to use energy as a as an industry, and as a global community, is to use energy as a platform for broader economic growth and social well-being- platform for broader economic growth and social well-being and to ensure that the economic benefits of energy production and to ensure that the economic benefits of energy production flow to all stakeholders.
Putting this framework into place will require leadership- Putting this framework into place will require leadership-responsible, accountable leadership from key players throughout the energy chain. It must be leadership rooted throughout the energy chain. It must be leadership rooted in action, not words. And it must be leadership rooted in partnership, not nationalism or isolation. For too many, the benefits of globalization are still just a promise. True energy security – the successful delivery of affordable, reliable energy is one of the key levers of a fully functioning global economy. Let’s use the platform of the IEF to continue a substantive producer-consumer dialogue and accept the leadership challenge of creating the new level of energy security required for a growing, multilateral world.