UAE partnership with United States is greatly contributing to global energy security, Mohamed Bin Dhaen Al Hameli

posted on 26/09/2010: 77 views

Washington, D.C. - The United States is a key economic and political partner of the United Arab Emirates and this close relationship is greatly contributing to global energy security in an increasingly interdependent world

"There is no escaping the fact that we live in a world that is impacted by globalisation and interdependence. Countries are increasingly dependent on each other for critical supplies be it food, energy or essential goods. Global trade is at the heart of the global economy and is an important driver of economic development and the creation of wealth for all countries", said Mohamed Bin Dhaen Al Hameli, Minister of Energy of UAE in his luncheon address at Washington Energy Summit 2010

The minister added: "I would like to seize this opportunity to make it very clear that countries such as the UAE which have been blessed with major oil and gas reserves are deeply aware of their responsibility to ensure that reliable continuous supplies are available to consuming countries. In practice, this translates into an obligation to make multi-billion dollar investments often without any assurance that there will be a market for the incremental production".

"Our record as a responsible energy supplier attests to that fact. For the last half century, we have provided stable and regular supplies of oil and gas to customers throughout the world. Whenever there has been a global emergency, we have responded by increasing our energy production. We have been able to do this, because we have invested in spare production capacity - something that no private corporation would even contemplate".

"In recent months, some people have complained that oil prices were too high. Viewed from the perspective of high investments required to have additional production capacity oil prices are not high at all", Mohamed argued.

After decades of oil production, it is clear that the age of easily accessible oil is coming to an end. All the major oil fields in easily discovered structures have been located. It now requires all the advances in geo-scientific knowledge and innovative technologies to be brought to bear to make new discoveries. Consequently the costs of oil exploration and production have exponentially increased.

Furthermore, many countries - including those in the Gulf Cooperation Council - are now looking at expensive enhanced oil recovery and sour gas projects, he remarked.

The world can no longer afford to leave 63-65 % of discovered oil reserves in the ground. Developing techniques to produce some of this oil will augment world recoverable oil resources significantly.

When oil prices in 2008 fell to $35 a barrel, it was well below the level needed to cover the marginal costs of many projects and effectively stalling the exploration of new frontiers and the development of new discoveries.

"Current oil price levels provide an incentive for resource-holders such as the UAE to continue investing across the hydrocarbon value chain, to ensure that we are able to fully meet the anticipated demand for our crude oil for many years to come".

Like many other oil-producing countries, the UAE has a very fast- growing economy and with it the country is witnessing a rapid increase in energy consumption. For example, our national annual peak demand for electricity is likely to more than double by 2020. As energy consumption in other nations rises, we can anticipate increasing competition for energy resources.

"We are therefore faced with a choice of whether we should divert a significant percentage of our oil and gas production from exports to the domestic economy or find alternative energy sources to fuel our incipient industry, and our power generating and desalination plants. We chose the latter", the minister said.

Last year, the Emirates Nuclear Energy Corporation awarded a major contract for the construction of four new 1,400 megawatt nuclear power stations. "The UAE firmly believes that nuclear power represents an important clean energy source that should be developed along with other clean fuels. We have been able to embark on an important civilian nuclear energy programme in close collaboration with the I.A.E.A. The first plant will be commissioned in 2017 and the objective is for nuclear energy to eventually account for 25 percent of the UAE's power requirements. Our nuclear program is being developed in close collaboration with our international partners, including the United States", he further said.

In August the UAE's Federal Authority for Nuclear Regulation and the Nuclear Regulatory Commission of the United States signed a Cooperation Arrangement for the exchange of technical information and cooperation in nuclear safety, security and environmental impact of nuclear energy facilities. The scope of the arrangement also covers a joint safety research exchange, as well as nuclear safety training for personnel.

This Arrangement was made within the framework of the bilateral nuclear cooperation agreement between the two governments.

"Let me make clear that the UAE's civilian nuclear energy program will strictly adhere to the highest standards of safety, security, non-proliferation and operational transparency", he assured.

Government officials, non-proliferation advocates, and energy experts worldwide have called the UAE's approach a gold standard for countries interested in exploring nuclear energy for the first time.

"The UAE firmly believes that oil is a valuable commodity that should not be squandered. As many of you are aware, the UAE has assumed a leading role in the search for a sustainable energy future. It has launched a multi-billion initiative known as Masdar which is a global cooperative platform for the open engagement in the search for solutions to some of mankind's most pressing problems: energy security, climate change and human expertise in sustainable development".

Masdar is building the world's first carbon-neutral city in Abu Dhabi and among the first tenants will be the International Renewable Energy Agency, now headquartered in Abu Dhabi. The objective is not just to reduce carbon emissions at home but also to play a leading role in the development of innovative new technologies that can effectively contribute to substantial reduction of global warming.

"Our philosophy is that protecting the environment begins at home. Over the coming years, the UAE expects to halve carbon emissions through a wide range of measures".

Already, there has been a transition to natural gas feedstock for power and desalination plants which will go a long way towards reducing per capita emissions. "We believe that the best way of securing a sustainable economic future in a carbon constrained world is to develop a balanced portfolio of clean energy sources in which nuclear, renewable energy, oil and natural gas all have a role to play".

The UAE's geographic location enables us to utilise solar energy to the maximum as soon as efficient advanced technology to harness solar energy on an industrial scale is developed. Wind and wave energy are other sources we should consider.

As we count the cost of emissions on the global environment, there is a need for a debate on the 'environmental cost' of fuels that considers carbon emissions generated during the extraction process and the credit achieved from sequestering CO2 in the process. It is clear that oil produced in the Middle East with no or little artificial lift, is more environmentally friendly than oil produced from tar sands and oil shale, he said.

"I sincerely hope that my words today have contributed towards an understanding of the UAE's stand on a range of issues which are of concern to the United States. We are a small country slightly larger than South Carolina in area; however, we play a substantial role in world energy supplies and are firmly committed to continue supplying oil and gas to an energy-hungry world and to the protection of the global environment", the minister concluded. – Emirates News Agency, WAM

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