A Barrel Or Two

Your role as Executive Director of the IEA is to steer the world toward a more secure, sustainable energy future. What role does Abu Dhabi play in the global energy landscape?

Abu Dhabi is of course a major producer and exporter of crude oil, and the UAE plays a very important role in OPEC. In recent years UAE production has been pushed up close to 3 million bpd to help compensate for some of the recent disruptions in supply. This has allowed prices to remain relatively stable. Abu Dhabi is also very active in the gas trade. LNG has been exported to Japan for nearly 40 years, while Abu Dhabi and Dubai have been importing surplus gas from Qatar since 2004, and transiting part of that supply to Oman. Therefore, Abu Dhabi sees all sides of the trade in gas. In the long term, the extensive use of renewable energies will also contribute to energy security, in the Gulf area as everywhere else. There is great scope for solar power in the region, as Abu Dhabi’s pioneering solar thermal plant, Shams I, has recently demonstrated.

As the Abu Dhabi National Oil Company (ADNOC) works to increase natural gas production via the development of sour gas reserves and CO2 injection technology, how do you see Abu Dhabi’s natural gas influence reaching beyond the borders of the UAE?

Abu Dhabi certainly seems well integrated into the global gas market, as an exporter, an importer, and a transit country. Gas is becoming a popular fuel; it is relatively clean and quite widely available. But once Abu Dhabi’s associated gas is spoken for and the easily available non-associated gas begins to decline, developing more challenging reserves gets expensive. It is important to find ways to make the projects more attractive through offsetting benefits. Wet gas-fields deliver NGLs and condensates; a sour gas field can deliver quantities of sulfur for export (and I think Abu Dhabi is building a special railway to transport this); and with CO2 injection you can enhance production while disposing of unwanted green house gases. Our team working on carbon capture and storage has been very interested in the technical and legal challenges of this approach. This is an area where international collaboration yields real dividends; and, as for solar power, successful projects will tell their own story.

Part of the investment strategy toward energy diversification includes four nuclear power plants, which are intended to allow the city to be 25% powered by nuclear energy by 2020, when all four plants will come online. What is your take on Abu Dhabi’s nuclear ambitions as countries such as Germany, Belgium, and Switzerland phase out of nuclear?

Every country has a sovereign right to decide on the role of nuclear power in its energy mix. Nuclear is one of the world’s largest sources of low-carbon energy, and as such has made and should continue to make an important contribution to energy security and sustainability. The IEA’s World Energy Outlook has examined the effect of low nuclear investment in detail. The analysis has shown that low nuclear investment is likely to lead to higher demand for gas and coal, higher electricity prices, increased import dependency on fossil fuels and electricity, and a more difficult path to decarbonisation, although such a trend could also open up new opportunities for renewable energy sources. Such a scenario would therefore make it much more difficult for the world to meet the 2°C climate stabilization goal, and have potentially negative impacts on energy security.