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GREEN ENERGY
CREATING AN ENERGY TRANSFORMATION ECOSYSTEM “Energy Transformation” is now heralded as the great opportunity for the United Kingdom Continental Shelf, (UKCS). But what does “Energy Transformation” mean and how can it positively affect our businesses? The simple truth is that in order to understand the opportunity we have to first understand the drivers.
Maybe for the first time ever, the upstream oil and gas industry is facing an existential threat. The industry can no longer plough its own furrow by dominating the energy markets. Oil and gas operators now have to contend with investors who want to see more transparency in the way profits are secured. They are increasingly applying non-financial factors as part of their analysis to identify material risks and growth opportunities. These non-financial factors are typified by Environmental, Social and Governance goals or ESG’s. For companies this is no longer “business as usual”, now as 21st Century Oil and Gas Operators we have to reinvent our business case.
The offshore energy industry in Western Europe is no longer the sole playground for oil and gas. We now share this space with renewable energy companies. Notably, offshore renewable energy is now on a deflationary cost curve. This has been achieved through a combination of economies of scale and standardisation of design and installation. By contrast offshore oil and gas is on an inflationary cost curve, as the hydrocarbons becomes harder to find and therefore more expensive to fund. “Isolation gives time but not immunity.” Lamine Pearlheart
About the author: John Butler is an accomplished business manager and project management practitioner, with over 20 year’s marine and offshore engineering experience. A Chartered Engineer and a Fellow of the IMarEST he started his career in the merchant navy. Having worked at TechnipFMC, Jacobs Engineering and Wood, John has amassed a wealth of knowledge in engineering design, delivery and installation of offshore projects. John is also an experienced mentor and technology integrator having worked with OGTC TechX program supporting development of new technology companies.
www.ogv.energy I April 2021
So here we are at a cross roads. A datadriven, digitally-enabled society has created a hyper-turbulent world. The rules of the game have not only changed, but continue to change at a rapid pace. The oil and gas industry now has to adapt to a new reality, one where we are now a part of an energy ecosystem; a place where decarbonisation is not only an expectation but a requirement. Remaining isolated by being faithful to hydrocarbons alone, is no longer an option. We now have to diversify into alternative energy, just to remain relevant. It is true that oil and gas will be around for decades to come, after all, energy transformation will be accomplished through the use of hydrocarbons. Nevertheless, oil and gas demand is on a steady, progressive, and chronic decline. Energy transformation is as much about ensuring that we have reliable sources of energy, while we reduce GHG emissions. This is where oil and gas companies can play a vital role. For decades we, in oil and gas, have challenged convention, developing technologies and techniques necessary to meet the global demand for hydrocarbons. These techniques and technologies can now be repurposed in pursuit of alternative energy which is more sustainable and will meet the ever increasing need for energy.
