Speech Abstract

Mr. ZHANG, Kang
Deputy Director of the Consultant Committee of the Petroleum Exploration,
Development and Research Institute of SINOPEC

Cooperation in Energy Development for Win-Win Outcome

From the macro perspective, the present oil and gas markets have achieved equilibrium of supply and demand respectively. However, considering the potential supply capacity, the supply might still outstrip the demand.  Since the start of this century, the OPEC Surplus Oil Capacity has fluctuated between 1.4-6 million barrels/day, and IEA countries have been able to keep more than three months of oil reserves. For countries like Iraq, Iran, Mexico and Venezuela, production has been held back due to human factors. There are enormous natural gas reserves waiting to be explored and exploited. It is expected that once the pipelines and liquid natural gas (LNG) infrastructures are in place, there would be a surge of supply from Russia, Iran, Saudi Arabia and Turkmenistan.  Meanwhile, it’s the unexplored offshore resources that are most captivating.  Unconventional oil and gas hold tantalizing prospects for these reserves.  Evidently, the pessimistic forecastsregarding oil peak and oil depletion proved to be unfounded. Today, it is no longer realistic to analyze the world with a Cold War mentality, nor is it helpful to exaggerate legitimate competition as confrontational.  Today, there is no longer a need by major states to “Fight for Oil”.

As the three leading energy consumers, China, Japan and the United States share common responsibilities and needs concerning energy security and environmental protection.  In energy saving, environmental protection, unconventional oil and gas exploration and energy management China has much to learn from the US and Japan. Technical cooperation guided by a genuine respect for each other’s intellectual property rights is feasible.  Technical exchanges promote mutual trust, dispel misunderstandings, and resolve conflicts; cooperation brings about mutual benefits. Cooperation among the three countries will contribute to the world’s energy and economic development.