Today's Edition
KHALED AL KHAWALDEH (ABU DHABI)
In recent years, the transition towards renewable energy and decarbonisation has dominated discussions at the annual Abu Dhabi International Petroleum Exhibition & Conference (ADIPEC).
With the rise of new technology and more complex challenges facing the energy sector, Stuart R Broadley, the CEO of the UK-based Energy Industries Council (EIC) and the Energy co-chair of the UAE-UK Business Council, says the industry is undergoing a transformation rather than a mere transition. And he believes the UAE, with its agile trade and energy policies, is well-positioned to navigate future trends in the energy market.
"I think transition is seen as a from one place to another in a relatively transactional way, from relying on oil and gas to not relying on oil and gas, replacing it with other fuel types," Broadley told Aletihad on the sidelines of the ADIPEC conference on Monday.
"But energy transformation is more about a shock to the system. It's saying it's not going to be easy or necessarily planned, it's not going to be always just either, because they're dealing now with such a fast-changing series of world climatic events."
Having attended the last eight ADIPEC conferences, Broadley has witnessed first-hand the evolving narratives in the energy industry as the challenges of transitioning energy production come into sharper focus.
He said this has resulted in a situation where there is more emphasis on the role of new technology and a deeper understanding that what is required is an energy mix, where oil and gas and other traditional forms of energy still play a role.
The pragmatism of the UAE's leadership and its willingness to opt for an energy mix is largely why he believes the UAE is well-placed to make the most of the forthcoming transformation.
"In other countries, energy transformation often comes with a policy bias, which is perhaps 'we don't like oil and gas', so we're going to transform, or we're going to transform because we don't want to trade with this country or that country," he explained.
"Whereas the UAE is much more open in its trading relationship, so much more open about its understanding that there's a role for all energy sectors, and I think that means that transformation will probably be less stressful here. It will be more balanced, probably be faster, probably cheaper and they'll position themselves very well globally."
Commenting on Minister of Industry and Advanced Technology Dr. Sultan Al Jaber's opening speech, which made strong references to the changing geoeconomic order, the rise of technology like AI and the need to decarbonise, Broadley said the sector was going through a phase of readjustment and review.
"The idea of a transformation is that you're not going from A to B. You're saying A and B almost don't exist anymore. You're going completely to Z. You're throwing everything up in the air and saying it has to change so radically that it's not going to be smooth anymore," he said.
This meant that many investors, previously bullish on energy transition, were reluctant and waiting to see how things played out. This includes seeing how AI may reshape the energy mix, but also how the development of alternate fuels and technology like hydrogen and carbon capture would proliferate.
"They are feeling like it's more transformative, more of an unpredictable, radical and difficult journey, and that makes them hold back a bit," he said.
