asia pacific oil & gas conference and exhibition (APOGCE) 2024

 

Mark Hatfield - Managing Director Chevron Australia  
Asia Pacific Oil & Gas Conference and Exhibition (APOGCE)

15 October 2024

 

I would like to begin by acknowledging the traditional owners of the land we meet on, the Whad-juk people of the Noongar nation, and pay my respects to their Elders past, present and emerging.

I’d also like to acknowledge the 2024 Conference Chair, Michelle LaPoint, SPE President Terry Palisch, and my fellow keynote speaker Liz Westcott.

Along with the Western Australian Minister for Energy, Environment and Climate Action, The Honourable Reece Whitby MLA who spoke this morning.

And lastly, I’d like to express my appreciation to the Conference organising committee for inviting me to speak with you today. It’s an honour to be here.

Chevron is pleased to be part of SPE, whether it’s through supporting university students to access the SPE community, or conferences like this one.

Events like this provide a valuable opportunity for learning, connection and collaboration.

For those who have travelled to be here from other parts of Australia, or from abroad, welcome to Western Australia and its capital Perth. This is a fitting place to meet and discuss the capability and future of our industry.

Perth is a city that has and will continue to play a major role in the global energy industry.

It’s also home to Chevron’s Australian headquarters, and we’re proud to be a part of it.

We’re also proud of our industry, which plays a crucial role delivering energy that enables human progress.

We all have common dreams and among them are better living standards. This includes access to education and medical care; connectivity and mobility; and social and economic opportunity.

Our industry has made human progress a reality for millions of people for a long time. It provides the necessities of life by helping feed the world’s population with mechanized farm equipment.

It provides a fantastic standard of living for those of us privileged enough to be in a developed world.

It also provides promise to those in developing countries, that they may one day have the things many of us take for granted.

Heating when it is cold, air conditioner when it’s hot. Refrigeration to preserve our food, and energy to transport us to visit our friends and families, and to work.

It also helps grow economies, just like here in WA where we power mining and minerals processing.

The energy we produce supports everyday life as we know it.

But none of this is possible without people.

At Chevron, we talk about human energy... because we believe the greatest resources we have are human ingenuity, creativity and innovation.

Our people – and most certainly our petroleum engineers – are problem solvers. Experts who have innovated and challenged the boundaries of what is possible for generations. And will continue to do so for generations to come.

Our technical workforce is the forefront of our industry, finding new and improved ways of getting things done.

This industry is big. It’s bold. It’s innovating. And I’m excited to be part of it.

I started my career at Chevron as a production engineer more than 40 years ago and I’ve seen our profession adapt and innovate as our industry has evolved.

We don’t do things the same as we did 40 years ago. We do them better. And in 40 years’ time it will be different again.... and better too.

And this will only continue as we work to provide the energy the world needs today, and strive to meet our lower carbon aspirations, for the future.

I look at the future for petroleum engineers, and that future is bright.

Earlier this month, the International Energy Agency forecast global gas demand to rise by more than 2.5 percent this year, reaching a new all-time high, with another increase of 2.3 per cent next year.[1]

To deliver this growth in energy, we need to continue our record of improving and innovating the way we work – the world needs the technical expertise all of you bring.

We only need to look back at the evolution that has occurred, and the progress we’ve made, to know that we should be optimistic about the future.

Chevron’s presence in Australia began over 70 years ago with the discovery of oil off the WA coast. This discovery led to the creation of our WA Oil business, which has produced some 335 million barrels of oil since 1967.

Our first big transformation was the move to LNG, which began with a share in the North West Shelf project.

Our focus expanded when Chevron and our joint partners made the decision to invest more than 80 billion Australian dollars in two of the world’s largest LNG projects – Gorgon, on Barrow Island and Wheatstone, near Onslow.

The investment in these two facilities was a significant one for our company, and it was a decision we made with confidence.

• Confidence in our world class resource base;
• Confidence in the capability and commitment of our people to deliver large complex projects; and
• Confidence in the long-term demand for our product.

Today, these world class assets are providing reliable and affordable energy the world needs.

Together, they deliver 6.5 percent of the world’s LNG supply, which is around one third of Australia’s LNG exports.

Our operations also provide 45% of the natural gas used here in Western Australia, where it is used to fuel the mining and minerals processing sector as well as generating electricity and home use.

The fundamentals which gave us confidence to invest – our resource base, our talented people, and the demand for our product – still exist today, fuelling our optimism for the future.

Of course, it’s a future that will look different… one that will provide new challenges and opportunities.

We all acknowledge the world is in the midst of a multi-decade energy transition.

And we’re all grappling with the challenge of how to meet the ever-increasing demand for energy.... while reducing global carbon emissions.

Successfully addressing that challenge will require us to balance:

• economic prosperity;
• energy security, and;
• environmental protection.

We know that access to energy is critical to support human progress and economic prosperity for everyone.

Today, there are about eight billion people on the planet. In 25 years, the population is expected to grow to 10 billion people.

The population, and the energy needs of a developing world, are ever-increasing.

Energy security has become increasingly more important. We all want lower carbon energy. But we need to make sure the trains keep running and the lights stay on during the transition. It’s important to get that balance right.

We can’t allow our energy system to fall into crisis… and we can’t put the energy security of Australia, or our closest trading partners and allies, at risk.

We need to have a better conversation about what it will really take to achieve reliable, affordable, and lower carbon energy for all.

We all have a role to play in advocating for a more balanced, and more pragmatic public discussion about energy.

We know the energy transition will occur at different paces, in different places – including here in Australia and the broader Asia-Pacific region.

One thing is clear. We want a lower carbon future, and gas is going to play a vital role in that future.

As my colleagues at the Australian Energy Producers group recently shared, the proportion of gas in Australia’s primary energy consumption is higher today than any time in history … at 27 per cent.

Between 2012 and 2022, natural gas and renewables both increased their contribution to Australia’s primary energy consumption by exactly the same amount – 220 petajoules per year.

Over this same period, it’s no coincidence that Australia’s greenhouse gas emissions decreased by around 20 per cent.

Gas is backing up the roll-out of renewables and supporting the phase out of coal, while driving the nation’s powerhouse mining and minerals sector.

And it’s natural gas that is the largest energy source powering Australian manufacturing and industry.

The importance of gas is set to continue as Australia, Asia and the world transforms to net zero.

Of course, there are challenges as we navigate the way towards our 2050 aspirations. Balancing the need for lower carbon intensity... with a growing demand for energy.

To put the world on a path to achieve our energy and climate goals, our opportunities lie in three key areas: policy, consumer behaviour, and technology.

In policy, Governments set the direction. They can use the carrot or the stick.

Their challenge is to find a balance that incentivises change.... while fostering an environment that still encourages investment and ensures energy security.

When we look at consumer behaviour, the way we use energy is key. The high standard of living enjoyed by those of us here today would be difficult to give up, and it’s sustained by energy.

We know that demand for energy is set to grow as more people around the world aspire to have what we take for granted every day.

The third area, technology, is the one I have the most confidence in. The one that will have the biggest impact on the pace of the energy transition.

While emissions reductions through to 2030 are projected to come from readily available technology, the IEA’s Net Zero by 2050 report says that in 2050, almost half the reductions will come from technologies that are currently at the demonstration or prototype phase.

These technologies need to be developed and implemented over the next 25 years.

So, there is plenty of work to do.

Some of these technical solutions are already in operation.

At Chevron, we believe Carbon Capture and Storage will play a critical role in a lower carbon world.

Experts agree with us. The International Energy Agency says reaching net zero will be virtually impossible without CCS[2].

CCS is a technology that is reducing carbon emissions today, as we’ve already shown that we can capture and safely store CO2 at a globally significant scale.

It’s happening at Gorgon, where we operate the world’s largest CCS system dedicated to carbon abatement.

That project has injected more than 10 million tonnes of greenhouse gas since starting up in 2019.

Along with Gorgon, Chevron is backing new CCS projects to continue to lower the carbon intensity of our operations.

As we look to the future, many solutions are needed to achieve the balance of economic prosperity, energy security and environmental protection.

Being in a room full of technical professionals, there is cause for great optimism.

I believe you and your colleagues are the key that will unlock the technologies we need to successfully navigate the energy transition.

To create a future of energy that works for everyone– and I’m confident we’ll get there.

Thank you.

 

[1] IEA, Global Gas Security Review 2024, p6, Available: Natural gas demand growth picks up in 2024 amid uncertainties over supply - News - IEA
[2]Energy Technology Perspectives 2020, Special Report on Carbon Capture Utilisation and Storage p13 “Reaching net zero will be virtually impossible without CCUS”