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$2 trillion investment could convert coal power to natural gas and reduce carbon emissions by 15%

Energy and climate are two sides of the same coin, Crescent Petroleum CEO stresses

Natural gas has a critical role to play in ensuring energy supplies and tackling climate change, and investment of $2 trillion could convert the world’s coal power to gas, and thereby cut global total carbon emissions by 15 per cent, Majid Jafar, CEO of Crescent Petroleum, the Middle East’s oldest and largest private oil & gas company, told energy executives in London.

Supporting a switch to natural gas, particularly in the developing world, will allow the world time to make the transition to even lower carbon energy sources, enabling a more equitable transition in the developing world, and ensuring balance in the energy trilemma of availability, affordability and sustainability, Jafar said in a keynote speech at the opening of the annual World Energy Capital Assembly, the annual global gathering of energy industry and finance professionals.

“Energy and climate are in fact two sides of the same coin – if we focus only on one and neglect the other, we will fail. And the key role for natural gas as a transition fuel was recognised by the final declaration at COP28 in the UAE last year. Yet while the wealthy nations of the OECD consume half of the world’s natural gas, many developing nations are left far behind and if they cannot access natural gas to support economic growth, they are forced to rely on more dirty fuels, such as coal, to the detriment of the climate at the same time as there is more energy poverty,” said Majid Jafar, who is also Board Managing Director of Dana Gas PJSC, the leading publicly-listed natural gas company in the GCC, and Vice-Chairman of the Crescent Group of companies, headquartered in the UAE.

Jafar pointed out that today, more than 7 billion people in the Global South are demanding the same right to stable energy and prosperity that the 1 billion people in the OECD wealthy nations take for granted. And with eight hundred million people globally still without electricity, and another three billion still using wood for cooking which is harmful to health and for climate change, the need for urgent action is therefore clear, he said.

But he observed that western financial markets have in recent years been less supportive of the natural gas industry, leading to underinvestment and energy poverty in developing countries, which is harming global development and forcing countries in Asia and Africa to burn more coal and produce more emissions. The current annual global investment of $250 billion in the sector is half of the $500 billion per annum needed to maintain steady growth in production of natural gas supply in line with energy demand.

“Crescent Petroleum has long championed the role of natural gas in reducing emissions and improving energy access. Over the past 15 years, our gas production in the Middle East has helped avoid over 50 million tonnes of CO₂ by replacing diesel with natural gas for electricity generation, while enabling affordable electricity for millions and enabling tens of billions of dollars of GDP and fuel cost savings for the host government,” Jafar told the audience. “And to this end, we are also proud to be a founding signatory to the Oil & Gas Decarbonisation Charter, a global industry effort launched at COP28 in the UAE last year to accelerate the reduction of methane emissions,” he added.

Jafar made his comments before hundreds of oil and gas industry executives, leading energy bankers and consultants in a keynote address marking the opening of the Assembly on Monday. The Assembly is the flagship event of the Energy Council, the world’s leading network of more than 100,000 senior energy executives and professionals from around the globe with the primary mission of connecting energy executives to the finance and investment communities needed to finance the global energy industry.

Crescent Petroleum has been carbon-neutral across operations since 2021 by making significant reductions in carbon intensity and working actively to further decarbonize its operations. The company’s carbon intensity has today fallen to 5.8 kgCO2e/BoE, which is one third of the global industry average.

“By embracing natural gas as a critical transition fuel, we can reduce emissions, improve air quality, and provide reliable energy to all, while enabling the addition of renewable sources. And so create a more resilient and equitable global energy future, one that balances economic growth, energy security, and environmental sustainability,” Jafar added.