Zarubezhneft CEO discusses conventional energy future

  • Oct 14, 2021
  • Zarubezhneft

The participation of the General Director of Zarubezhneft in the Russian Energy Week-2021 was continued by a session dedicated to the future of conventional energy. The session was also attended by the Deputy Prime Minister of the Russian Federation, Alexander Novak, and the Prime Minister of the Socialist Republic of Vietnam, Pham Minh Tinh, as well as representatives of the governments of China and Hungary.

Climate change has become a big challenge for the entire world community, the answer to which, according to many experts, should be the transition of global energy to carbon neutrality. To ensure such a transition by the middle of the century, in May 2021 the International Energy Agency (IEA) presented the Net Zero by 2050 roadmap. The refusal from funding exploration and development of new oil and gas fields should be one of the steps towards achievement of this goal.

The session was opened by the Prime Minister of the Republic of Vietnam, who noted that the country pays great attention to sustainable development, adaptation to climate change, reduction of carbon emissions, and efficiency of the energy industry. Russia and Vietnam have developed strong friendly relations in the fuel and energy sector and joint projects are the basis for the further development of cooperation in new areas, including renewable, green energy. A vivid example of efficient and promising cooperation between the two countries in the fuel and energy sector are Vietsovpetro in Vietnam, as well as Rusvietpetro in Russia.

Sergey Kudryashov, the General Director of Zarubezhneft: “In its activities, Zarubezhneft is guided by global trends. At the same time, we synchronize our plans with the development of those countries in which we work. Take Vietnam as an example - a country where gas, wind and solar power are the priority energy sources. By 2030, we plan that our portfolio will have 50% oil, 50% gas, today the shares are distributed as follows: 80% is oil and 20% is gas. We forecast that production volumes should more than double. We also expect that Zarubezhneft will have its own power generation in the amount of 1GW ”.

According to Sergei Ivanovich, the oil business will face high competition, and the key challenge for oil and gas companies will be to improve the efficiency of production and field development, and work with costs.

“We are planning to increase investments in the gas sector. The first steps were taken by the company in Vietnam, in line with the country's development trends, where Zarubezhneft is forming a gas cluster based on existing assets. The company entered a large pipeline consortium and acquired several blocks in Vietnam and Indonesia. The main investments in gas for geological exploration are in Vietnam and Indonesia. Similarly, in the area of renewable energy sources, it is a synergy with existing assets. We are moving in this direction together with our Vietnamese and European partners,” - said the General Director of the company.

Adhering to this strategy, having the best onshore base and construction capacities for working on the shelf, the Company is already participating in the development of a major, in terms of global scale, project for the construction of an offshore wind farm in Vietnam together with the world leader in offshore wind power, DEME.

Sergei Ivanovich also noted that the issue of capturing and storing carbon dioxide is undoubtedly important, and the company is closely monitoring the situation and technologies in this area, and already last year, pilot works were carried out at the Zarubezhneft fields in Russia.

“Geothermal energy is a new direction that we are now considering. The company has already started working on geothermal projects. We see close synergy with our long-term experience in the underground development of oil and gas fields. And we believe that this will help increase the efficiency of projects in a new direction. This, among other things, will allow us to reduce the carbon footprint of our oil producing assets,” - commented Sergei Kudryashov.