2005 Conference Presentation

FUELLING FUTURE GROWTH

Will Davie, Managing Director and Chief Economist of Simmons & Company International, will be delivering a keynote address in the opening plenary session

"The last few years have seen energy making headline news around the world: geopolitical instability in the world's greatest oil province - the Arabian Gulf; brownouts and blackouts in California, the US Northeast, Norway and Italy. And the thirst for oil really manifested itself with spiraling oil consumption in China as the economy boomed and rising demand in the huge US market. Energy security: ensuring a reliable, sustainable supply and meeting global demand is now a major issue and one which requires urgent attention.

Demand will never slow. 80% of the world's population currently accounts for just a tiny percentage of our energy consumption, but that is changing as more people seek a better quality of life and the developing world catches up with the developed world.

Our current energy mix is primarily oil, natural gas, coal and nuclear. But it is clear that we need to explore every kind of energy and this must include alternative energies, not only to ensure security of supply, but for environmental motives. Projections show that if there is no change in energy policies, CO2 emissions will grow by 1.7 % per year over 2002-2030 with nearly 70% of the increase coming from developing countries (IEA), and the energy import dependency of consuming countries will rise to dauntingly high levels.

We must also accept that the days of cheap, reliable energy sources are behind us. We can no longer take supply for granted and future energy costs have to be high if we are to invest in our energy supply. And we need an energy strategy which supports energy source diversification."

Will Davie, Managing Director and Chief Economist of Simmons & Company