The oil and gas industry uses energy in its operations to make products, but it is also the main supplier of energy for transport, electricity and heating. Consumer demand for energy, driven by emerging economies, is expected to increase 35 percent by 2035 according to the International Energy Agency, an increase likely to be met predominantly by fossil fuels.
Yet despite the growth in demand, the oil and gas industry still faces financial pressures and must innovate in order to be competitive. So called, “easy oil” has been depleted and refining margins have become squeezed as more processing is necessary to treat heavy crude and produce the low-sulphur products regulations are demanding.
In order to compete in these new markets, oil and gas companies will have to reduce operating costs and diversify their product base through new renewable energy technologies.
The oil and gas industry also has an important role to play in the transformation of global sustainable energy markets, which represent a new and expanding business opportunity to create new revenue streams. Oil and gas companies will be leaders in developing advanced biofuels and are also entering renewable markets such as wind and solar.
Finally, oil and gas companies can help increase access to electricity for the 1.3 billion people without access by supplying energy such as natural gas captured from the redirection of current gas flaring streams, and investing in activities that provide cleaner and more efficient cooking options for the 2.7 billion people who rely on wood, coal, charcoal or animal waste for cooking and heating.