Abu Dhabi is creating a dynamic economy that is driven by the sectors of the future, not by the sectors of the past. It is creating 13 specialised clusters that offer solutions to issues in society.
Industry leaders and economic experts came together to discuss how the energy sector can achieve long-term sustainability and resilience during one of the last Finance and Investment Executive sessions of the day.
Entitled Navigating global geopolitics while investing in a secure, low-carbon energy future, the session began with an examination of how much impact geopolitics issues really have on energy sector projects.
Massimo Falcioni, Chief Competitiveness Officer at the Abu Dhabi Investment Office (ADIO) reassured the audience by saying that geopolitical issues did not affect long-term projects, only short-term ones.
When it came to the question of how to approach risks in energy investments, he declared that “risks can be mitigated but they can never be completely removed.”
“One way to eliminate risk is to deeply analyse very the policies of the place where you are thinking of developing your project, and consider the stability of the local government. Strong governments can provide vital support in the form of financing or infrastructure.”
He also went on to explain Abu Dhabi’s vision to create a dynamic ecosystem for the renewable energy sector, and its overarching strategy of the Falcon Economy.
“Abu Dhabi wants to triple its non-oil economy,” he began. “As part of that vision, it is creating a thriving business and investment ecosystem that is driven by the sectors of the future, not by the sectors of the past. To do this we are creating 13 specialised clusters, that each offer solutions to issues in society.
“For example, we have one cluster dedicated to smart mobility and one to food security and innovative methods of food production. It’s an amazing vision, and three clusters have already been launched and are in operation.”
While Abu Dhabi offers a safe and secure environment for investors, Andrew Tait, Group Chief Financial Officer for Fertiglobe explained that another tip for locating a promising location for energy projects is simply to ‘follow the money’.
“Money Follows energy, essentially, so energy economics is the answer. You may encounter some hurdles along the way, but if you keep energy and money as your north star, you will know that you are on the right the right road,” he noted.
“Agility in the short term is also essential, while diversification and exploring different countries can be very helpful, too.”
Lydia Rainforth, Managing Director and Sector Head of Barclays of European & Middle East Energy team, then provided a financial and investor viewpoint of the impact of geopolitics on renewable energy projects.
“You should look for countries that offer good technologies, low energy prices and plentiful labour, these are the areas where you should consider building. You should also conduct thorough and proper research. Really look into places and challenge yourself and ask the hard questions before making a decision. It’s about engaging in some basic economics.”
When asked about his thoughts on the benefits of localised and nationalised policies, Dr.Wang Zhen, Senior Director-General of CNOOC, and President of CNOOC Energy Economics Institute, professor and doctoral tutor of China University of Petroleum (Beijing) said: “Localisation can be a good and a bad thing, it all depends on the situation. International cooperation is of course very important too, and it can enhance the sustainability of any project.”