The CEO of Kuwait Petroleum Corporation (KPC), has said that the case for national oil companies (NOCs) working in closer partnership with international oil companies (IOCs) has become compelling due to the current global financial crisis.
Saad Ali Al-Shuwaib, writing in the International Energy Forum’s newsletter, said the industry faced many challenges meant that enhanced cooperation across the whole hydrocarbons industry, based on mutual benefit, was the way forward.
“As the balance of supply and demand shifts, the benefits of partnership between NOCs, IOCs, and service companies become more compelling – to rethink existing models and develop new models of partnership,” Al-Shuwaib said.
“NOCs of energy import-dependent countries are adopting more aggressive foreign expansion plans, to encourage the build-up of grass-roots refineries and upstream exploration.”
“Improved accountability and transparency, regulatory compliance and corporate governance can help to access
new markets and ensure sustained industry growth,” he added.
Al-Shuwaib said that the continued global rise in demand for fossil fuels could lead to uncertainty regarding supplies and increased “producers’ perceptions of investment risk”. This further underlined the need for greater cooperation.
“Shared responsibility between producers and consumers could help in addressing future challenges and reducing anxiety in the market,” he said.
The Kuwaiti official also believed that investment in cleaner energy sources and other environmental issues would also be a mutually beneficial proposition.
“Spending on R&D and in the development of more efficient and clean technologies, specifically in new energy technologies such as carbon capture and storage is one area where NOC and IOC cooperation can easily be paved,” Al-Shuwaib said.
Kuwait Petroleum Company is the state-owned energy company of the Gulf state with an output of around 2.5 million barrels of oil per day.
