ADIPEC closes with AI debate, calls for methane mitigation finance

(Abu Dhabi) — As ADIPEC closed its doors to more than 200’000 visitors in the United Arab Emirates (UAE) on Thursday evening, sentiment was divided as to the outlook on balancing future energy demand with climate commitments.

On the methane front, speakers were optimistic about the ability of countries and companies to fix emissions, though that was tempered by the acknowledgment that better financing is still needed.

Bjørn Otto Sverdrup, Chair Executive Committee of the Oil and Gas Climate Initiative (OGCI) and Head of Oil and Gas Decarbonization Charter (OGDC), said that progress in mitigating methane emissions has been strong, though hard-won.

Until recently there was very little technology on both detecting methane emissions and also how to fix it, he said. “So compare that to today — the industry is fundamentally recognising this challenge, there is ownership to fix it…taking the same approach that we take on safety, on spills — these incidents can be avoided,” he said.

“And thirdly, we have the technology to fix it — so we are at a very different place to where we used to be, but this has been a journey,” he added.

Studies show that methane accounts for approximately one third of the global rise in temperatures. The lifespan of methane is relatively short — only around a dozen years — but in this short time, methane absorbs vastly more heat than greenhouse gases.

Yet methane leaks from every part of the gas supply chain – including from drilling sites, long-distance transmission lines, compressor stations and even from gas stoves in people’s home. The latter poses a serious health risk. Children living in homes with gas stoves are at a 20 percent increased risk of suffering from respiratory illnesses, according to The World Health Organization.

Zubin Bamji, Manager of the Energy and Extractives Global Department of the the World Bank, urged that financing plays a critical role in addressing methane emissions reduction.

“Finance is one of the key missing elements in this ecosystem of methane and flaring decarbonisation, and the World Bank would like to play a role in that gap. The idea was to provide catalytic funding that is needed in many developing countries or emerging economies for them to recognise that there is actually an opportunity here.”

Khalid Bin Hadi, Managing Director in the UAE of Siemens Energy, said that in order to advance decarbonisation there needs to be investment in innovation: “For me, innovation is about solving problems. We need to apply innovation, we need to scale innovations, and that will require three elements: investments, industry partnerships, and true partnership.”

Toby Z. Rice, President and CEO of EQT Corporation, one of the largest gas producers in the U.S., said that methane emissions reductions are “achievable,” and outlined the journey his company has taken to lowering emissions. He pointed out that the challenge now is to improve transparency and data reporting in methane mitigation efforts, so that the general public believes a company when it says it has reduced its methane emissions.

AI and data centre demand

Yet much of the debate at ADIPEC this week centred upon the energy that will be needed to power the growing AI and data centre sector.

Demand for energy, including new grids and data centres, will require up to $4 trillion in investment annually, the UAE’s Minister of Industry and Advanced Technology Sultan al-Jaber said earlier in the week.

“We need massive capital investment. We are talking about more than $4 trillion annually to cover grids, data centres and all sources of energy supply,” Al Jaber said, adding that “gas provides more than a quarter of the base-load power required by data centres.”

Electricity demand will keep surging through 2040 as power for data centres grows fourfold, said Al-Jaber, who is also CEO of the Abu Dhabi National Oil Company (ADNOC).

Doug Burgum, 55th Secretary of the Interior of the United States, concurred, saying: “The free world cannot lose the AI arms race…for that we need power (…) Let’s get the capital flowing,” he said.

On Sunday, the day before ADIPEC opened, ADNOC and Microsoft signed a deal to develop AI agents, which enable automation of processes such as production, maintenance, monitoring and data analysis. AI agents automate routine and complex tasks on their own, lowering the risk of human error.

Dr. Sara Vakhshouri, founder and president of SVB Energy International, a strategic energy consulting firm, cautioned about the link between AI, data centres and energy poverty.

“With AI and data centres and the need for electricity, it expands data poverty and to be honest with you, myself sitting in Washington D.C. I am worried that I might get into the domain of being in energy poverty, of not having access.”

“Why? Because the state just next to us — North Virginia — holds the most energy data centres in the U.S., and now in that state even a small restaurant, like a small chicken fillet restaurant, cannot get a permit to open because there is no electricity to allocate,” she said.

She went on: “If electricity producers and distributors come and sign a deal with whoever pays higher which is naturally data centres, tech companies…would the residential [sector], which is normal people, have enough electricity?”

Regulation and foresight is therefore very much needed to mitigate these risks, she concluded.

“Energy addition”

Al-Jaber also introduced the idea this week of an “energy addition,” by which he meant developing new technologies, including renewables, in parallel with existing fossil fuels. Energy transition, by contrast, typically refers to the transfer from one energy source to another.

“This all adds up to way more than a single path energy transition; what we are talking about here is reinforcement not replacement, in fact what we are really talking about here is energy addition,” the minister stated, in what many would view as a reverse step for decarbonisation efforts.   

Climate scientists have repeatedly warned that a substantial and urgent reduction in fossil fuel is needed to curb global heating, with the burning of coal, oil and gas recognised as the chief drivers of the climate crisis.

(Writing by Sophie Davies)