TheCable

The Organisation of Petroleum Exporting Countries (OPEC) says the global energy sector requires about 12.6 trillion dollars investment cumulatively for development by 2045.

Mohammad Barkindo, OPEC secretary-general, said this at the 14th annual conference of the Nigerian Association of Energy Economics (NAEE) in Abuja on Wednesday.

The International Renewable Energy Agency (IRENA) explains that the energy transition is a pathway toward transformation of the global energy sector from fossil-based to zero-carbon by the second half of this century.

Barkindo said despite the move to net-zero carbon in most developed countries, crude oil would continue to remain relevant to the global economic growth and development.

He said the push for energy transition must take into consideration the economic wellbeing of developing countries and the need to end energy poverty globally.

“It is vital for us to remember that oil will remain the largest contributor to the energy mix to 2045 with more than 27 per cent, according to the latest OPEC World Oil Outlook,” Barkindo said.

“Renewables are developing most rapidly, but at the same time, the world’s economy is set to double and all resources will be required to meet this growing need.

“Cumulative investment of 12.6 trillion dollars in the upstream, midstream and downstream is crucial through to 2045 in order to meet this need.

“Investment in 2020 dropped by more than a whopping 30 percent in the face of COVID-19, even worse than the dramatic declines seen in the severe 2015-2016 industry downturn.”

He further said that the energy security risk that would result from too little investment would heavily impact both producers and consumers.

“Oil-producing developing countries, like Nigeria, would be particularly hard hit.

“History has shown that energy insecurity brings with it economic insecurity and geopolitical instability.

“All OPEC Members, including Nigeria, will have to re-strategise to maintain their positions in the new global energy mix, including focusing on economic diversification.

“Oil-producing countries, and in particular African countries that rely on oil and gas production for revenues, must create an investment friendly climate — to this end.

“Oil is the lifeblood of our country (Nigeria), thus the importance of this issue cannot be underestimated.”

Barkindo commended Nigeria for tackling the issue of electricity with its promotion of solar and wind energy and expansion in the use of natural gas.