The energy industry faces several challenges as it tries to shape its future. Amongst them are:
- A prolonged period of lower oil prices
- Pressure to improve profitability through greater cost and capital efficiency, whilst maintaining dividends
- Increased shareholder and stakeholder activism focused on the potential threat that the investments in fossil fuel may end up as stranded assets
- Uncertainty of long term oil demand as a result of the COP 21 agreement
- The fast pace of technology developments
- The strategic dilemma of the rapid increase in clean energy solutions
Staying abreast of these challenges is necessary to drive meaningful long-term strategic decisions. There is a new imperative to provide clean, secure and affordable energy. We are entering “new energy era” with an expected transition over the long term from fossil fuels to renewables.
In view of the uncertainty of the future energy mix, the industry is exploring two related strategic paths, integration and diversification. Integration, firstly down the energy value chain to capture maximum added value, and secondly taking an integrated approach towards how it stimulates innovation, develops technological solutions and enhances capabilities. At the same time diversification is becoming important. To mitigate the risk of uncertainty about the long term, the industry is considering not only diversification within the oil, gas and petrochemical chain, but also beyond, into renewables, and other sources of energy.
The Panelists will explain how their organisations are enhancing their capabilities to anticipate the many challenges of the sector and transform themselves for the future by integration and diversification.