ENERGY + INDUSTRY – Delivering business outcomes in a sector facing many economic, social and political challenges.
Unquestionably, energy production, distribution and consumption rank among the most pressing issues in the global economy.
The International Energy Agency (IEA) estimates that by 2030, energy demand will have grown by 40 percent and that the investment needed to meet growing global energy needs will be $38 trillion by 2035.
Yet, in the face of this staggering demand, the energy sector is confronting many challenges to its “license to operate” — including those in the economic, social and political arenas. Managing these challenges requires a strategic partner and counselor that understands the industry and the volatile public landscape.
We help energy companies make wise investments in their reputations and connect with the public audiences who are impacted by their business strategies. This commitment allows them to earn a “license to operate” on three critical levels:
• Political: Broad political support is critical for sustaining energy industries, stable regulatory environments and predictable growth.
• Social: Broad social acceptance is important, particularly in open societies, local communities and countries where environmental issues, such as climate change, are major issues.
• Economic: Acceptance of economic benefits is important to provide economic rationale and validity at a time of weakened economic wellbeing.
This is not simply a public relations or issues management exercise: it’s about the business imperative. It’s knowing and understanding the desires and expectations of stakeholders – engaging with those who can help you or prevent you from achieving your business objectives.
With senior counselors around the world, our global energy team has experience across the industry. We’ve worked in mature markets and developing countries and have experience with Fortune 750 companies, trade associations, government agencies, start-ups and investors across all sectors (including oil and gas, coal, nuclear, utilities, pipelines, transmission, transportation, mining, renewables, clean tech and energy services).
The energy industry is comprised of all activities involved in extracting, processing, and distributing natural resources to create energy. While it includes alternative energy sources, it is dominated by the production of petroleum and natural gas. The petroleum sector has always been unstable as disturbances in the supplier regions may greatly affect the supply, which in turn affects prices. Though bad for the consumer, the rise in the price per barrel of crude oil is good news for oil companies.
Energy is the backbone of any economic system. The energy industry includes the discovery, production, distribution, and sale of energy for multiple power needs including heat, light, propulsion, and whatever else energy may be needed for . There are two primary sources of energy: renewable alternative fuels and fossil fuels. Alternative fuels include energy sources such as wind, water, solar, geothermal, bio-diesel, or nuclear power. Fossil fuels account for nearly 80% of the world’s energy consumption and include oil, gas, and coal.
The petroleum and natural gas industry is divided into three processes: upstream, midstream, and downstream. Upstream is the exploration of resources, and includes production and extraction companies. Midstream is transporting the product to factories and the refining process. Downstream mainly involves distribution and sales. Gas distribution utilities, service stations, and other oil product wholesalers are all involved in the downstream process.
The upstream segment is listed under the Mining/Minerals/Metals industry, as discovering and extracting resources for energy would be defined as mining.
The industry, despite being very profitable for a sustained period of time, has many problems. One of the major issues facing the industry is its environmental impact. Nearly all energy sources impact the environment in a negative way. The most common effects discussed are global warming and the disappearance of the ozone layer. In order to combat this global problem, leaders from 120 countries met in February 2010 to discuss possible solutions. Nothing was established then, but the framework for future regulations was laid. Carbon cap trading is a very realistic possibility, where producers can a set amount of carbon they can produce and are able to sell or buy excess amounts of these carbon caps.
The other big issue with petroleum as the principal source of energy that it is today is the fact that it is a nonrenewable resource. All resources are finite, petroleum is no exception. Petroleum takes millions of years to be created and is being used at a much faster rate then that. These factors are leading a push towards the alternative fuel division of the industry.
Company Clients and Industry Leaders
Royal Dutch Shell (Netherlands), Exxon Mobil (United States), Sinopec-China Petroleum (China), BP (United Kingdom), PetroChina (China)
Let us put that know-how to work for you. Contact us to find out more.