Gastech Days I & II: Energy transformation through innovation

The first two days of Gastech 2024 have flown by with talking points aplenty and a who's-who of the energy industry in Houston at the city's George R. Brown Convention Center. 

Former US President George W. Bush got things going on Monday night by highlighting his state and country's achievements in the global energy sphere at the Gastech pre-event gala dinner. 

The state of Texas is the US' top crude oil and natural gas producing state. It also has the nation's highest refining capacity by some distance and remains a wind power leader. As Q4 2024 approaches, the US remains world's largest LNG exporter and its largest crude oil producer. 

However, as Day I of Gastech - which is formally running from September 17 to 20 - kicked off on Tuesday, energy bosses bemoaned the lack of clarity and consistency from Washington on policy matters pertaining to natural gas exploration and LNG permits. (Read full report for Forbes here)

The Oilholic kick-started his Gastech 2024 speaking circuit journey on Tuesday as well, with India's Minister of Petroleum and Natural Gas Hardeep Singh Puri - a seasoned diplomat turned politician and a lively keynote speaker at international events. 

Our fireside chat was titled 'Energy transformation through innovation and investment'. It also served as a curtain raiser for India Energy Week 2025. 

Puri explained how India was managing the cyclical volatility in the energy market, its efforts aimed at improving energy diversity, investments in renewables and a call for changing the paradigm from a production-oriented approach to a more consumption-oriented approach. All at a time when oil prices are currently lurking around 2021 lows. 

The event's exhibition floor also opened its doors on the first morning for the 4-day event, with 800 exhibitors and 20 international country pavilions. Overall 50,000 attendees are expected this week, with 7,000 delegates from 125 countries. 

Later on Tuesday, yours truly also hosted a pivotal panel discussion titled 'Harnessing the advantages of natural gas to fuel the artificial intelligence (AI) revolution.' 

The panellists included Rebekah Eggers, Global Client Engagement & Innovation Director, Energy & Resources Sector, IBM, Arun Kumar Singh, Chairman & CEO, Oil and Natural Gas Corporation Ltd, Ken West, President & CEO, Honeywell Energy and Sustainability Solutions, Naser Al Yafei, SVP, Strategy, Sustainability & Transformation, ADNOC Gas, and Matthew Babin, Head of Energy & Natural Resources, Palantir Technologies. 

The panel touched on the growing need for electricity - often and increasingly generated by natural gas plants - to power data centers and fuel the AI revolution. This is expected to drive a surge in natural gas demand. 

Some panellists noted that natural gas is the most cost efficient energy source capable of delivering the round-the-clock, reliable power required by tech giants. Others said AI itself could chalk sustainable future pathways predicated on renewables. 

It better be, for according to the International Energy Agency (IEA), global power demand from data centers could skyrocket to over 1,000 TWh by 2026 – double the levels seen in 2022. 

It is a subject area yours truly rounded up the first day of Gastech 2024 with a BBC Business Today interview with Sally Bundock. We talked about the complexities and opportunities of using natural gas to power the AI revolution which seems to be the most plausible near-term solution. 

Day II - Wednesday - brought further profound discussions on the energy transition and learning to do more (in terms of throughput) with less (energy). It is something the engineering, procurement and construction (EPC) segment is taking pretty seriously. 

The Oilholic touched on the subject in a fireside chat with Chris Ashton, CEO of Worley, who discussed how contractors manage these variables in today’s operational landscape and are having to contend with a high interest rate and inflation climate in a very competitive industry. 

Ashton also offered perspectives on how AI, new technologies and innovative approaches are revolutionizing energy networks, power grids and gas infrastructure, and how these advancements contribute to the efficient and cost-effective completion of projects to accelerate the path toward net zero. 

That's all for now folks. There's plenty more to come from yours truly from Gastech. So keep reading, keep it here, keep it 'crude'! 

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© Gaurav Sharma 2024. Photo I: Houston's George R. Brown Convention Center, the venue of Gastech 2024. Photo II: Gaurav Sharma holds a fireside chat with Hardeep Singh Puri, Minister of Petroleum and Natural Gas, India on 17.09.24. Photo III: Gastech 2024 exhibition floor. Photo IV: Gaurav Sharma on BBC World Business Today on 17.09.24 at 11:46 CDT. (Courtesy: BBC) Photo V: Gaurav Sharma holds a fireside chat with Chris Ashton, CEO of Worley on 18.09.24.

Oil heading to $90, renewables in Japan & more

It's been a hectic few weeks in the energy markets over the course of which oil prices have acquired a bit of buoyancy. Its something they briefly lost last month following the OPEC+ meeting. Brent crude futures currently sit just a few dollars south of $90 per barrel level, having dropped below $80 in early June. 

While global crude demand permutations haven't materially altered, there is renewed optimism over lower interest rates in key markets. That and higher demand projections in Asian markets, especially India, appear to be supporting prices. This sets the stall for relatively higher crude prices as we enter the first month of the second half of the year. 

All things staying even, the Oilholic would argue there is now a near-term case for $90 Brent crude prices. However, defending price upticks beyond the level would prove tricky, given the fact that crude supplies, especially those of light sweet non-OPEC crude, remain on a solid footing.  

Away from the oil market, yours truly was interviewed by the BBC on Japan's and wider East Asia's renewable energy landscape. The Oilholic spoke about a call by the country's private sector to triple its renewables capacity by 2035. 

This kerfuffle over Japan's future energy mix has been going on since the Fukushima tragedy in 2011, and has been further complicated by readily available and competitively priced LNG. 

Japan continues to trail the G7 in terms of renewables. However, while still using coal as a power generation source, Japan is not expanding usage in the same way as India and China are. Overall, a renewables capacity target in excess of 360GW by 2035 looks very ambitious. However, never discount Japanese ingenuity for getting things done! 

Elsewhere, here is one of the Oilholic's missives from late June on why the world needs to nurture sustainable entrepreneurship for Forbes (click here), and another one on why green hydrogen's fate in a net zero economy hinges on upscaling for Energy Connects (click here).

Finally, on the eve of the UK's general election, here are this blogger's thoughts on how the outcome will impact the country's energy industry. Regardless of whoever wins, looks like UK Energy Inc may be stuck between a rock and hard place! That's all for the moment folks. More musings to follow soon. Keep reading, keep it here, keep it 'crude'! 

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© Gaurav Sharma 2024. Photo: Gaurav Sharma on BBC World © BBC, June 25, 2024. 

UK election result's impact on British Energy Inc

By all accounts, result of the UK General Election on May 7 was simply stunning. Pollsters got it horribly wrong, Prime Minister David Cameron’s Conservative Party returned with a majority against all expectations, Scottish National Party bagged 56 out of 59 parliamentary seats in the ‘oil hub’ of Scotland - all the ingredients to excite politically minded scribes and the general public alike. The Oilholic began his experience at Ellwood Atfield’s splendid election night bash in Westminster (photo above left) ushering in news of the first exit poll predicting the Conservatives were going to be the largest party with 316 members of parliament.

As events unfolded into early hours of the morning and late afternoon the next day, Cameron’s Conservatives returned with 331 MPs and a slim majority putting to bed all talk of a hung parliament. This blogger was up when Labour heavyweights Ed Balls, Douglas Alexander, Jim Murphy and Liberal Democrats ministers Vince Cable, Ed Davey, Lynne Featherstone and Danny Alexander all lost their seats.

Resignation of the hapless Labour leader Ed Miliband who managed to deliver his party’s worst election result since 1983 followed, along with that of Nick Clegg, now former deputy prime minister and Liberal Democrat leader. Cameron soon walked back into Downing Street after meeting the Queen and telling her he’d now form a majority Conservative government.

Having enjoyed the drama of election night well into sunrise the next day, it’s worth pondering what the result means for the UK’s energy industry in general and the oil and gas business in particular. Afterall, the Oilholic did fret about the direction of the market in his pre-election column for Forbes.

For starters, Ed Miliband’s barmy energy price freeze isn’t going to happen. A daft idea, daftly presented to maximum populist effect just didn’t work and is now in the dustbin of political history. This blogger expects ratings agencies to ease up both on UK-listed energy utilities Centrica, the owner of British Gas, and SSE, another service provider as well as the sector in general. 

Unsurprisingly, both stocks jumped as the entire London market welcomed the result on May 8 morning with the FTSE 100 momentarily returning back above 7,000 points. Nonetheless, Cameron’s government faces a very serious challenge of planning investment towards creaking energy infrastructure – from nuclear to renewables – ensuring the lights are kept on. By some estimates, the required capital expenditure could be as high as £330 billion by 2030.

Switching to the mainstream oil and gas business, both the Conservative victory in the UK and an SNP landslide in Scotland are broadly positive for various reasons. As this blogger has noted before, Chancellor George Osborne’s taxation policies turned positive for the industry towards the end of the last parliament, as the oil price decline began to bite North Sea players. 

Collective measures put into effect back in March imply that the UK’s total tax levy would fall from 60% to 50%, giving a much needed breather to those prospecting in the North Sea. Any further stimulus measures for the better are unlikely to be disrupted by the SNP, even if they do have a broader agenda of roughing up other government programmes both North and South of the Scottish border.

This is broadly good for the industry, as it goes through a challenging period and grapples with the restructuring in Aberdeen triggered by companies as large as BP and as small as independent operations services providers. 

Finally, turning attention to the new energy minister Amber Rudd, a Conservative MP for Hastings, who has been appointed as the successor to Ed Davey; the choice is a great one. Obviously, her credentials are solid or she wouldn’t be here. Gauging the response of the wider industry, most have welcomed the appointment.

Rudd is seen as conscientious and hard working minister. Even Greenpeace sent out a release welcoming her to the job, hoping that she’d bring the same energy to implementing the Climate Change Act, as she did to fight the corner of fisheries in her last government remit.

With a challenging portfolio, Rudd has her work cut out and we wish her well, especially as she sets about the arduous task of attracting investment to the sector. That’s all for the moment folks! Keep reading, keep it ‘crude’!

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© Gaurav Sharma 2015. Photo: Ellwood Atfield election night party, May 7, 2015 © Gaurav Sharma