Depletion of reserves, shrinking market behind EU move away from hydrocarbons: Gazprom Neft head
Rapidly depleting reserves and a gradual reduction of its share of oil markets are key reasons behind the European Union’s transition away from hydrocarbons to an ecologically clean economy, the head of Russian oil major Gazprom Neft said on Wednesday.

Photo: Julia Yakimenko / TASS

Alexander Dyukov, chairman of the board of Gazprom Neft, was addressing a panel session at the Tyumen oil and gas forum chaired by Sergey Brilev, President of the Global Energy Association.

For the moment, the acceleration in the transition is taking place, for the most part, in minds. In reality, what we see, on the one hand, is a rapid, serious worsening attitude on the part of consumers, business and politicians towards fossil fuels,” Dyukov told participants.
On the other hand, oil companies are starting to react, to make statements. Every six months we see that companies are starting to take on greater ecological obligations. If we look at the reasons behind this, in Europe in the first instance, I would suggest that we are not looking at this in terms of concern over climate, though that is certainly important. Rather, what is happening is a result of certain market conditions.”

It was no secret, he told the gathering, that reserves in Europe have been subject to depletion for some time. And other countries holding resources are not as keen as they once were to let European companies into their projects. Access to investment is no longer a problem as securing those investments has become much simpler. And in terms of technology, service companies are ready to erect a well and carry out other services without being involved in a project.

This market situation has pushed European companies into new energy sectors, to renewable resources, into projects involving ‘green hydrogen’, biofuels.”

Major European oil companies, including BP, Shell, Repsol and Total, were already speaking openly about serious reductions in investments in oil projects, Dyukov said.

European governments are discussing new goals to lower greenhouse gases already to 55 percent of 1990 levels, about introducing hydrocarbon taxes and other measures,” Dyukov told the panel.

These are protectionist measures seek to defend their energy sector with the knowledge that it is very difficult for them to compete now in the traditional sectors. They have moved along the path of trying to build a new sector of climate-neutral energy to be dominated by European companies.”

In the United States, he said, views on reducing the role of hydrocarbons were quite different.

There are no such strident declarations. And one of the reasons for this is that there is something to work with in terms of reserves,” Dyukov said. “Large oil and gas companies in the United States so far are not following the example of their European colleagues, though public opinion is bringing to bear mass pressure on them too.”


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September 2020