By: HE Mohammad Sanusi Barkindo, Secretary General of OPEC
As government leaders, hydrocarbon experts, analysts and decision makers descend on Abu Dhabi to attend ADIPEC 2017, all of us involved with the oil and gas industry are afforded the opportunity to take stock of developments that have transpired over the last 12 months and discuss what the future has in store.
Undoubtedly, the previous year has not been without its share of challenges; however, it has also been notable for milestone achievements and several new courses chartered. For these reasons, the theme of this year’s ADIPEC, ‘Forging ties, driving growth,’ is particularly pertinent, not only in characterising the year that has just passed but also offering a framework for how we can confront, together as an industry, the challenges that we will inevitably face over the coming months and years.
‘Forging ties’ and enhancing cooperation with a broad range of stakeholders have been themes resonating across OPEC’s work over the last year. OPEC was, and remains, extremely cognisant of the fact that overcoming the challenging market conditions created by an oversupplied market that led to high levels of stocks requires a collective and concerted effort across the industry. No single player acting alone can achieve the stability in the market or restore the much needed confidence that we all seek.
In the second half of 2016, OPEC embarked on far-reaching consultations among OPEC Member Countries and between OPEC and non-OPEC producing nations, as well as with consumers and the broader international community, about the urgency of restoring sustainable oil market stability in a collective manner. These extensive consultations, both formal and informal, across various global capitals, were unparalleled in scope and scale in the history of OPEC.
At last year’s ADIPEC, there was a great deal of interest in the landmark decision taken at the 170th (Extraordinary) Meeting of the OPEC Conference in Algiers, on September 28, 2016. Subsequently, this has been complemented by the decision of the 171st Ministerial Conference in Vienna on November 30, 2016 and the Declaration of Cooperation between OPEC and non-OPEC producers of December 10, 2016. These decisions meant that, for the first time in the history of the industry, 13 OPEC nations and 11 non-OPEC participating countries came together as strategic stakeholders, to seek to stabilise the global oil industry.
The Declaration of Cooperation extended the hand of unity to participating non-OPEC oil producing nations to broaden the platform of voluntary production adjustments. In May of this year, the signatories of the Declaration agreed to extend the production adjustments for a further nine months from July 1, 2017.
The success of the Declaration of Cooperation is paving the way towards a new framework for the permanent and longstanding forging of ties among oil producing countries in the interests of both producers and consumers, including the regular practice of joint research activities. Such a framework of sustained cooperation between all participating nations is vital given the industry’s growing complexity and inter-connected nature.
While the Declaration of Cooperation has been the most concrete manifestation of OPEC’s desire to collaborate with other global energy stakeholders, this has long been an integral aspiration of the organisation. The most recent version of our LongTerm Strategy states, “OPEC will continue to expand and strengthen its dialogue with all producing and consuming countries, as well as regional groups, UN institutions and other energy-related international organisations.”
The value of such cooperation has been seen in the regular, successful Energy Dialogues which OPEC has with key partners. These aim to encourage an exchange of views on energy issues between oil producers and consumers. Energy Dialogues have been established between OPEC and the EU, China, Russia and India. Such dialogues are an important highlight in OPEC’s annual calendar of activities.
Therefore, for OPEC, ADIPEC 2017’s theme of ‘forging ties, driving growth’ is not a hollow concept but rather a practical means of achieving our common goals. We all share the same, clear objective: market stability. We now have the framework and guide for working together: the Declaration of Cooperation. This, combined with the spirit of collective unity which I have encountered across the industry over the last year, fills me with confidence and optimism about what 2018 has in store. I would like to conclude by recalling the words of Henry Ford: “If everyone is moving forward together, then success takes care of itself.”
HE Mohammad Sanusi Barkindo of Nigeria began his tenure as Secretary General of the OPEC on 1 August 2016. He has previously been Nigeria’s National Representative, as well as its Governor to OPEC, and in 2006, he was Acting OPEC Secretary General. From 2009 to 2010, he was Group Managing Director and CEO of the Nigerian National Petroleum Corporation (NNPC). Earlier in his career, he was Special Assistant to former Minister of Petroleum Resources and OPEC Secretary General, HE Dr Rilwanu Lukman KBE. Barkindo has also been leader of Nigeria’s technical delegation to the UN climate change negotiations since 1991. He served as Chair of the Group of 77 and China at the UNFCCC and he was elected to serve three terms as Vice President of the Conference of the Parties.