Helge Lund - The Switch Interview

- [Helge] Often I think the debate is a little bit more oil and gas, as opposed to, other energy sources or resources. I think we need to look at this in a combination, and that I cannot see an energy scenario where you do not need all the energy that you can bring forward to the markets; bearing in mind that today, 1.6 billion people in the world do not have access to electricity. And according to forecasts, this number will still be at a level of 1.4 billion in 2030. We have to make sure that we can bring forward much more energy to the market due to a growing world population. At the same time, you need to solve the emission issues. - [Interviewer] So, how does the world get together, to meet the challenge of carbon? - [Helge] I think from an economic point of view, the solution is not that difficult in the sense that if you put the right price on CO2 emission, I think the market forces will work out solutions as quickly as possible. But the issue here is, how do you politically implement it? Given the fact that societies and countries around the world are in so different development stages. - So, you've had a price on carbon here in Norway for a while. What has that done to your efficiency? - Well, if I look at Statoil's, own operation today, we are emitting 60% less CO2 per barrel than the world average. And on top of that, we have more than 12 years experience of capturing CO2 and store it in the reservoir offshore. I think it's important that industry participate in this dialogue, because we need practical experience on ground, to be included in that dialogue and the political debate as well. - [Interviewer] If you look broadly at oil, do you see it as a supply issue, a demand issue, some combination of both? - I think there are issues on both, the supply and demand side. I guess on the demand side, we see a leveling off in the U.S. and in Europe, typically in developed countries. While we estimate that there will be a significant growth in oil and gas demand in Asia, and the Middle East, and moving forward. On the supply side, we see only more complexity. It's commercially more complex, it's politically more complex and beyond that, it's technically more complex; but altogether I think we see a pattern of conventional oil being even harder to find than we have seen in the past, and that the industry more and more have to attack unconventional resources to sustain growth and development. In my view, natural gas is a very, very important reach into the future and to a lower carbon world. We have seen some new developments the last few years, in terms of seeing a big potential, in unconventional gas resources, most notably in the U.S. You have got new technology to attack these resources, and also gas has been more mobile than it has been before, due to L&G and all the technologies. If you can continue this very positive development, in terms of cost reductions and technology development, I see a big role for gas. - [Interviewer] How much time would that buy us? - Well, it will buy us decades, in my view. But, I don't think we should use that as a cushion to not work on other areas, because some of these issues are so complex in finding, or developing efficient, renewable energy supply; that I think we need to put very good people, and a lot of capital behind it already today. From a political perspective, we can not deny a growing population access to energy and access to economic development. That should be a right to anyone in the world. So, the challenge here is to provide that energy in a best possible way, from a cost perspective, but also in terms of CO2 emission. But we don't, we do not only need to work on the most complicated issues. We can also, in my view, attack issues that are much more simple, at least in terms of technology. And that has to do with energy efficiency. Here, everyone can contribute. Individuals, companies, oil and gas companies, regulators, government in general, and so on and so forth. The good thing with that, is this is low hanging fruits, and it can be implemented quickly. So, here we need to concentrate more. Efficiencies can clearly be captured, also without changing lifestyle, but are we to solve the whole issue, around energy and climate, I think also, it will have to entail, and include also, changes in lifestyle for many of us in the future."