Friday, June 22, 2007

OPEC could curtail oil investment if biofuel boom materialises:


Wednesday, 20th June 2007, 14:05
VIENNA (Thomson Financial) - OPEC has warned it could curtail investment
in oil production because of a forecast long-term boom for biofuel but
cautioned that an oil shortage could emerge if biofuels ran into problems.

'We are not worried about introducing another source of energy,
especially if it helps fight climate change,' Abdullah al-Badri,
secretary general of the Orgaisation of Petroleum Exporting Countries,
told AFP in an interview.

But he added that 'some data show a very high quantity of biofuels in
the long run, by 2030,' which could mean that 'our demand will be lower
than we are forecasting.'

The European Union and the United States hope to reduce their oil
consumption by 20 percent beteween now and 2030 through increased
reliance on alternative energy.

'We are investing at this time 130 bln usd (97 bln eur) on 140 projects
by 2012 to increase production by 6 mln barrels a day,' Badri said,
adding that OPEC at present pumps about 30 million barrels a day.

The 12-member cartel also plans to invest 230 bln to 500 bln usd between
2012 and 2020 with a goal of boosting output by nine million barrels a day.

'If we receive information that oil demand will be reduced, it is our
right to reinvest our investment,' he argued.

'We can spend money in education and housing.'

But he warned that if in 10 years, the expected surge in biofuel
reliance does not materialise, 'there will be a shortage.'

Badri suggested that production of biofuels could be hampered by
increased competition for land and water, pitting those who want to use
such resources for food production against those want to apply them to
making biofuels.

Check for earlier Pacific Biofuel posts:

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