The Organisation of the Petroleum Exporting Countries, OPEC, and the European Union, EU, are now fine tuning ways to address exploration and production challenges, especially of offshore safety and human resource availability with a view to creating a safer operating environment.
The parties are also considering the establishment of the OPEC-EU Energy Technology Centre, ETC, for which a joint taskforce has been set up to discuss various issues surrounding the establishment of a virtual ETC.
These and more were parts of the agreements reached between OPEC and EU during their eighth Ministerial-level meeting of the energy dialogue which ended last week Monday in Vienna, Austria.
A statement from the OPEC Secretariat made available to Sweetcrude, said that after thorough discussions and a review of the energy dialogue’s overall progress, the two parties also agreed to hold:
• A workshop to discuss the findings of the study on technological advances in the road transportation sector.
• The completion of the preparations with regard to the proposed Energy Technology Centre, and,
• A roundtable on oil and gas exploration and production activities addressing key challenges such the safety of offshore operations and shortage of human resources.
These are as part of its joint EU-OPEC activities for the year 2011/2012, which report will be submitted at the ninth Ministerial Meeting, scheduled to hold in Brussels, Belgium, in June 2012.
Discussions at the meeting focused mainly on the market outlook in terms oil market developments, energy policies and the long-term outlook, as each party took turns to explain its activities since the last meeting.
Specifically, OPEC made a presentation on recent oil market developments and prospects, highlighting the robust rebound in the global economy in 2010, albeit at an uneven pace across different regions.
However, OPEC envisions that the momentum would moderate this year, due to such issues as “debt burdens, particularly in some parts of the EU region, inflationary pressures in major economies and prolonged unemployment, thus creating downward risks with regard to the level of oil demand in the near future.”
On the supply side, the producers group said the physical market continues to be supported by above-average trend growth in major producing regions, as well as sufficient stock levels, adding that it will continue to offer an adequate level of spare capacity for the benefit of all.
The EU updated OPEC on its actions relating to offshore safety in oil and gas exploration and production activities, while OPEC provided some initial findings of the joint study on technological advances in the road transportation sector, which covers automotive technologies and fuels, bottlenecks, policies and future changes.
The EU also addressed the issue of the impacts of recent developments on EU energy supplies and policies, including offshore safety. The impact that the unrest in some parts of the Middle East-North Africa, MENA region has generated on energy prices, energy policies and energy security was underlined, as well as the subsequent sharp rise in benchmark crude prices since the beginning of the unrest, and the initiatives it developed to tackle these challenges.
As a result, the EU added that its policy developments were focused on Energy Roadmap 2050, internal energy market and offshore safety.
In its long- term oil outlook, OPEC anticipates that oil will remain the leading fuel in satisfying the world’s growing energy needs amid largely sufficient resources.
The organisation further noted that oil demand is “facing significant risks stemming from uncertainties related to, among other things, lower economic growth paths, consumer country policies and discriminatory taxation. Other challenges include industry costs, technology and human resources.”
Accordingly, both parties agreed on the importance of sharing information and data covering all timeframes: historical, current and possible future demand and supply scenarios.
They also reiterated the benefits of continued participation in the Joint Organisations Data Initiative.
OPEC also spoke on the joint study ‘Impact of the use of biofuels on oil refining and fuel specifications,’ which reviewed current developments in biofuels, as well as possible impacts on crude demand, carbon emissions and refining economics.
It concluded that there was a large number of inter-related factors impacting the outlook for biofuels, such as evolving engine technologies and logistical and sustainability challenges.