Renewables important, but oil, gas strongest

There is no doubt there is a huge push for renewable energy cascading across the globe. Germany is pushing wind energy, and parts of the U.S. want solar energy to prevail, but if you listen to attendees at the Offshore Technical Conference (OTC) in Houston, while renewable energy is important and will continue to grow, oil and gas will be around for quite a while.

“There is no silver bullet,” said Karen Harbert, president and chief executive, U.S. Chamber of Commerce’s Institute for 21st Century Energy. “There is only silver buckshot.”

“Yes, we need wind and solar, but they will not be the only answer.”

Harbert said when it comes to alternatives, public education is important. “When it comes to energy, we can’t demonize energy entities. Oil will be and will remain the backbone of our economy for quite some time.”

“The renewable and alternative energy agenda is not going away,” said Gary Luquette, president Chevron North America Exploration and Production Co. “We need to engage the unfriendlies to find common ground.”

Renewable sources like wind, solar, and biofuels need to be developed, but they are not the only answer,” said Tim Cejka, president Exxon Mobil Exploration Co. “The world is not running out of energy resources.”

“Wind energy is popular, but not the answer. Natural gas and oil will remain effective,” said Larry Nichols, chairman and chief executive at Devon Energy.

Renewables are a part of the solution, said John Oyen, manager of business development for North America Oil and Gas at ABB. “You look at wind, solar, biomass, gasification; they will all play a part, but the free market will determine what is used.”

Everyone talks about renewable and they seem to think the technology will allow for a conversion right now.

There are “a lot of interesting things that will happen, but it will take longer than anyone thinks it will take,” Oyen said. “You have to keep everything moving along.

Even the ethanol market is growing in some parts of the world.”

“Brazil is in very good shape regarding ethanol,” said Nelson Narciso, director at ANP, the National Agency of Petroleum, Natural Gas and Biofuels. “We have been producing it since 1973. What I can tell you is the country is keeping its policy with ethanol, not only because of the price, but because of the environment. We are consuming more ethanol than gasoline.”

This discussion comes on the heels of President Obama unveiling steps to further his Administration’s commitment to advance biofuels research and commercialization. He signed a Presidential Directive establishing a Biofuels Interagency Working Group, announced additional Recovery Act funds for renewable fuel projects, and also announced his Administration’s notice of a Proposed Rulemaking on the Renewable Fuel Standard.

Meanwhile, a new survey released today finds oil and gas executives say mass production of renewable energy isn't likely before at least the middle of the next decade.

The survey by KPMG LLP comes amid President Obama's push for clean energy technology and millions in new investments in renewable energy.

Fifty-two percent of 382 petroleum industry executives surveyed said large-scale production of alternative energy sources won't be viable in the short term, at least not by 2015. Of those who believe such production is possible, 17% said the likely source is wind, 10% biodiesel, and 7% solar.

Participants included executives for major oil companies, independent exploration and production outfits, and other energy companies.

There's been a significant shift in perception over the front-runner in alternative energy. In a survey two years ago, 18% of executives said ethanol was the most likely renewable energy source for potential large-scale production, but it fell to 6% in the latest query.

– Gregory Hale