International Energy Forum Secretary General: 'The energy transition won't happen overnight'
We are here at the Milken Institute Global Conference in Beverly Hills, CA, where a couple of thousand the world’s big thinkers and heavy hitters join to talk about anything from politics to the economy to healthcare and yes, even energy. Which brings us to our next guest that is Joseph Mcmonagle. He is the Secretary General for the International Energy Forum. Lives primarily in Riyadh, Saudi Arabia, where I heard there’s some some energy discussion. There’s some energy. Yeah. Thanks for joining us. Great to be here. You know obviously you guys at IEF do a lot of great work across the transition as well, but you’re also heavily fossil fuel focused as well. You live in Saudi Arabia. What what are investors, what are our listeners and viewers maybe misunderstanding about the energy transition and oil and gases role in it? Well, look, energy security is now back in vogue at conferences like this, it would be whispered. Even at energy conferences a couple years ago, you would whisper about energy security. Now it’s a theme. It’s a big topic. Countries care about it. My member countries care about it. You know, the US is one of my member countries. They’re very concerned about energy security. I think there’s now a realization over the last three or four years mainly because of the energy crisis that started way before the war in Ukraine that that that we we need oil and gas. You know that that high prices and volatility are were created because we haven’t been investing enough in oil and gas. And so now there’s a realization, you know, yeah, the transition is not going to happen overnight. It’s going to be a lot more difficult than we’ve been. It’s going to take longer. I mean, right. I mean some of the smartest people in the world that are here, Joseph and five or six years ago I had somebody ask a question in a panel. I was moderating that oh, in five years when we’re off fossil fuels and I’m thinking Oh my God, these are, these are Harvard Duke educated people who believed that we were going to be off. There is no data point or the most bearish scenario is the IEAI think. And even their scenarios show growth for years or decades to come, do they not? That’s right. I mean, look, when, when in Europe, which is the greenest of the regions of the world, you know, when, when they ran into an energy crisis and the chips were down, they didn’t turn to renewables, they didn’t leap fraud to renewables, They went to natural gas, they signed big contracts with Qatar and a lot of USLNG was going to Europe. And and that’s I think going to continue to be the case as they try to replace Russian gas. But you know, but that’s a perfect example. I mean, there’s a lot of, there’s a lot of narratives out there at energy and climate conferences at natural gas. We don’t need natural gas. Natural gas is going to be a pivotal, not just a bridge fuel, a pivotal fuel for energy security going forward here. And and it’s not just pulling gas out of the ground, it’s pulling things like copper out of the ground. That’s right. We know, our audience knows the demand for copper is going up, but you guys have some new data that is really, to me, shocking. Yeah. We’re going to need to, what, more than double our copper production to meet some of these goals. Yeah. So the report that we’re coming out with next week is focused on copper and EVs. And so we look at it from that prism. You know, the, the typical EV uses 60kg of copper. Your internal combustion engine uses about 24 kilograms. OK. So it’s a lot more copper. It’s a little more than double. It’s a lot more copper if if we just take a business as usual case, this means no, no, no dramatic increase in the E VS just for industrial purposes, transmission, economic development reasons that you need copper forts. It’s important for economic growth in the world. By 2050 you’ll need 115% more copper. That’s more copper than has ever been mined in human history. If you add 100% E DS by 2035, which is a goal now of many countries, I think California has a goal like this. You have countries saying ban ICE vehicles. OK. If you add 100% E DS by 2035, you need 55% more copper mines than exists today. It takes 23 years to build a copper mine. So this idea that we have peak oil in 20-30, which another organization has predicted based on big advances in EVs, it doesn’t happen unless government start incentivizing and supporting and speeding up the timeline for new copper mines. If you don’t have new copper mines, you don’t have EVs. And therefore, this idea that there’s peak oil demand anytime soon is, is is really fantasy. Well, I I think the headline then could be, Joseph, that the energy transition is going to require taking a lot of stuff out of the ground. Yeah, with big heavy machinery. And we’re not talking about oil and gas either. Joseph Mcmonagle, the IEF, really appreciate it. A straight talk, not a lot of people maybe want to hear, but facts are facts. So, Joseph, thank you very much. Great to be here.