Rosneft CEO: World’s green transition turned into catastrophe

ST. PETERSBURG, Jun 19 (PRIME) -- Global green transition has yielded catastrophic results with the actions of regulators de facto banning investment in traditional energy, Russian oil major Rosneft’s CEO Igor Sechin said on June 17 presenting a report during the St. Petersburg International Economic Forum.

“The attempt to implement the green transition utopia has already yielded catastrophic results. The actions of irresponsible regulators have introduced a de facto ban on investment in the traditional energy … Having no clear goals, substantial technologies, or understanding of long-term consequences of their efforts in mind, they launched a process that caused crisis events in the global energy and sent inflation on the global markets spiraling,” he said.

The authors of the green transition unilaterally imposed standards, but failed to understand that the rules should be coordinated with those who have production capacities and the resource base. In fact, carbon neutrality is impossible now given the state of the green technologies, he said.

“In fact, carbon neutrality is unreachable on the global scale given the current pool of green technologies. Many necessary technologies are still at a stage of pilot projects,” Sechin said.

Improvement of technologies of traditional production of oil would reduce carbon emissions to a larger extent than investment in under-developed alternative technologies. The oil and gas sector should become a priority at the current stage of the green transition, he added.

Sechin said that Europe’s policy of diversification has failed. After rejecting Russian natural gas and having no other sources of liquefied natural gas, Europe switched to complete dependence on energy supplies from the U.S., he said.

Right now, only Russia and some OPEC countries could potentially raise their output of liquid hydrocarbons in the long run. At the same time, not only the oil production sector lacks investment, but geological exploration also suffers from it, and the global oil reserves are already being replaced only at the rate of 90%. Exploratory drilling works have been falling for a long time, he said, adding that the lack of investment would inevitably create a deficit of oil on the market and cause the oil price to grow.

Nevertheless, the ongoing climate changes create new opportunities of access to the Arctic region. Rosneft alone has discovered resources amounting to 20 billion tonnes of oil equivalent there, Sechin said.

But differences in the economic structure and production dynamics make it difficult for OPEC to reach joint decisions.

“It is becoming more and more difficult for the OPEC countries to reach joint decisions because of differences in the economic structures and production dynamics. The Middle Eastern OPEC countries are ramping up production and diversifying their economies by developing their non-oil economies, while the African OPEC countries are consistently cutting production and losing their weight on the global oil market,” he said.

The OPEC+ alliance should monitor not only their production quotas, but also oil exports taking into account the sizes of their internal markets, he said.

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