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Saudi Aramco CEO speaks at CERA Week 2005

Posted: 16 February 2005

Saudi Aramco President and Chief Executive Officer Abdallah S. Jum’ah called for greater cooperation among the various players influencing the energy industry in an increasingly interdependent world, in order to build an energy future that benefits both our planet and its people.

The remarks came in a keynote address that Mr. Jum’ah delivered at the prestigious Oil Summit of the Cambridge Energy Research Association’s Annual Conference (CERA Week 2005), organized in Houston from 14-18 February 2005 under the theme Rising to the Challenge: Securing the Energy Future.

The conference was attended by more than 1,500 top energy executives, policymakers and energy analysts from over 50 countries.

Mr. Jum’ah presented an outlook for global resources and the long-term energy mix, emphasizing that petroleum will remain the bedrock of the world’s energy supplies for the foreseeable future, just as it has for the past century.

“Advocates of rapid transition from fossil fuels to alternative sources of energy should not ignore the state of development of alternatives, the seriousness of many unresolved issues associated with them, the demands of global economic development and the need to eliminate energy poverty in the developing world”, said Jum’ah.

He added that over the long term the world will need to draw upon both fossil fuels and alternative technologies, as the alternatives become both technically and commercially viable, which will make them take on greater responsibility for meeting the world’s demand for energy.  In the meantime, and given the continued dominance of fossil fuels, even marginally improving their environmental performance will significantly benefit the health of the planet.

Mr. Jum’ah outlined four areas in the oil industry requiring further efforts and global cooperation to secure the world’s energy future. These areas are: increasing upstream investments, expanding and upgrading global refining capacity, improving environmental technologies, and greater investment in petroleum-related infrastructure, such as pipelines and terminals, including managing the safe movement of oil through strategic shipping channels and sea lanes.

Mr. Jum’ah indicated that Saudi Aramco is doing its part to ensure that oil supplies will be available when they are needed.  “We continue to identify new reserves and develop production increments that will gradually raise Saudi Aramco’s maximum sustained capacity, consistent with demand growth, beyond the current level of 10.5 to 12 million barrels per day,” he said.

The President and CEO also noted that Saudi Arabia’s oil strategy calls for maintaining a surplus production capacity of between one-and-a-half to two million barrels per day over its actual production. This surplus capacity, which the Kingdom has maintained, has played a pivotal role in maintaining world market stability.

Mr. Jum’ah also stressed Saudi Aramco’s commitment to technology and revealed that the Company continues to work on incremental efforts to steadily improve petroleum’s environmental performance, with the vision that one day new technologies may revolutionize the way we view oil as an energy source.

These strategic technologies focus on three areas: desulfurization of both whole crudes and oil products, managing the issue of greenhouse gas emissions, and devising technically and economically viable ways of reforming oil to produce hydrogen.

Mr. Jum’ah expected that international oil trade would increase substantially over the coming decades, contributing to an increasingly interconnected global marketplace, and he called for pragmatic and more balanced energy policies that do not discriminate against oil in favor of competing sources of energy.

He concluded by stressing the importance of the collective commitment of all parties concerned with energy to meet our obligations to the generations that follow us and to the earth they will inherit.

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