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Official Speeches

SECOND GREEK EU PRESIDENCY CONFERENCE

MAY 5th-6th 2014


Excellencies, Ladies and Gentlemen,

Good Afternoon,

I would like to express my sincere appreciation to the organizers for giving me this opportunity to address such a distinguished audience, and also for the excellent arrangements, warm reception and hospitality.

Ladies and Gentlemen,

Let me first give a brief introduction about “The Organization of Arab Petroleum Exporting Countries (OAPEC)” which I represent today.

OAPEC is a regional inter-governmental organization established in 1968 and located in Kuwait. Presently, OAPEC members include Algeria, Bahrain, Egypt, Iraq, Kuwait, Libya, Qatar, Saudi Arabia, Syria, UAE and Tunisia.

The main objectives of OAPEC are cooperation among member countries in the development of policies and joint ventures for oil and energy related issues, as well as preparing all kinds of studies related to energy and to oil and gas sector in particular.

OAPEC has established successfully four Joint Ventures companies and one institution, namely: The Arab Maritime Petroleum Transport Company (AMPTC) located in Kuwait, The Arab Shipbuilding and Repair Yard Company (ASRY) located in Bahrain, The Arab Petroleum Investments Corporation (APICORP) located in Saudi Arabia, The Arab Petroleum Services Company (APSCO) located in Libya, and The Arab Petroleum Training Institute (APTI) located in Iraq.

Excellencies, Ladies and Gentlemen,

The contribution of Arab countries in meeting the world energy demand and stabilizing the oil market is significant. With their great capabilities and huge hydrocarbon resources, they have the potential to play an even bigger role in the international energy scene in the future.

Arab countries hold about 57% of the world’s proved oil reserves and account for about 32% of the world’s oil production. The region holds about 29% of the world’s proved natural gas reserves and accounts for about 17% of the world’s marketed production of natural gas.

Irrespective of the fact that Arab countries energy demand has been steadily rising above the world average over the last years, it is still considered the largest oil exporting region and a significant natural gas exporting region in the world.

Arab countries oil exports reached about 20.5 million barrel/day (mnb/d) representing about 37% of total world’s oil exports during 2012.From which around 3.8 mnb/d were destined to Europe, representing about 18% of Arab oil exports and 30% of European oil imports during that year.

Turning to natural gas exports, the Arab region exported about 214 billion cubic meters (bcm) during 2012 representing about 21% of total world’s natural gas exports. About 87 bcm of which were destined to Europe, representing about 41% of Arab natural gas exports and 20% of total European natural gas imports during the year.

Excellencies, Ladies and Gentlemen,

Future Outlook :

World energy demand is expected to rise by 52% over the period between 2010 and 2035. Renewables, such as wind, solar, and geothermal, are expected to grow at over 7% per year, often as a result of government support and incentives.

Fossil fuel will continue to play the dominant role in meeting demand, although their overall share is expected to fall from 82% to 80 %. Oil is expected to remain the main energy source with the largest share, although its overall share may decline from 32 to 26%. Coal’s share remains relatively stable at around 27%. The share of natural gas, however, is expected to rise from 22 to 26%.

OAPEC member countries are projected to continue as the main providers of hydrocarbon resources for decades to come. Irrespective of their high consumption rates of both oil and gas, they have the potential for a further increase of their export capacity. In fact, they are the source for the major part of any additional conventional oil supply capacity in the future. Middle East and North Africa (MENA) region oil production is expected to reach 38.2 mn b/d in 2035, arise of 6.7 mn b/d from 2012 and natural gas production to reach 985 bcm in 2035, arise of 381 bcm from 2011.

For Europe, as in the case of most OECD countries, overall energy demand is stabilizing, but fuel substitution leads to significant shift in the energy mix. Europe oil demand is expected to decline to about 8.9 mn b/d in 2035, a decline of 2.9 mn b/d from the base year 2012.

By contrast, Europe natural gas demand is projected to rise in the long term to reach 605 bcm in 2035, arise of 80 bcm from 2011, while Europe gas production is on a declining trend to reach 215 bcm in 2035, a drop of 62 bcm from 2011.

Excellencies, Ladies and Gentlemen,

World energy demand is expected to increase by 54 % over the period 2010 to 2035. With this figure in mind, there is clearly room for all energies. Renewables, mainly wind, solar, small hydro and geothermal, are expected to grow at around 8% per year, often as a result of government support and incentives. Renewables share in the energy mix is expected to be at 3.5% by 2035, given its low initial base.

Many Arab countries are planning substantial hike in renewable energy capacity due to the availability of renewable resources. However, renewables can only be a complement rather than supplant the hydrocarbon and fuels.

Excellencies, Ladies and Gentlemen,

As we noticed, the EU and The Arab region will remain major players in the international energy scene and share complementary interests. As a major energy consumer and importer, the EU is interested in diversifying its energy supply source. While for Arab countries-major energy producers and exporters – customer diversification is an essential strategy in the light of the changing world energy landscape.

This leads to enhancing cooperation and strengthening relationship between the EU and the Arab countries in particular in oil, natural gas and renewable-based electricity trade.

There are also broad prospects for further cooperation between the EU and the Arab region in other areas of the energy industry. As renewables are projected to play a bigger role in the Arab region energy mix, this may open the door for partnership between the EU and the Arab countries to extend beyond trade towards cooperation in other energy related fields, including renewables technologies.

Excellencies, Ladies and Gentlemen,

Before I conclude, I would like to highlight the following two issues. The first point is related to the climate change issue. Many Arab oil producing countries, in their efforts to protect the environment and reduce emissions, are doing their utmost to adhere to the international standards in this regard.

However, linking between the environment and fossil fuels, in particular crude oil, as the only factor which affects the climate change is debatable and needs strong and more scientific evidence.

We believe that any agreement related to the post-Kyoto protocol should take into consideration the interests of all parties or groups of parties specially those countries which heavily depend on one or very limited resources for their socioeconomic development such as oil exporting countries.

The second point is related to the terminology of “Energy security”. We believe that the “energy security” should be known as the security of supply and the security of demand. Security resides in the stability of the entire market, to the benefit of consuming and producing countries alike. The need for enhanced energy security has to be seen from both supply and demand perspectives, which should be mutually supportive. By promoting transparency between major players in the oil market, producers and consumers, the world will definitely take a major step towards Energy Security.

Having said that I would like to thank you once again for your kind attention……

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