What future for oil companies: Total, ENI, BP, Shell, Exxon, Chevron?

In La Tribune 01/10/2020

What will oil companies be when in less than a century they will have seen their traditional activity, the production of oil and gas, considerably reduced or even disappear, not because of the peak of oil production, but probably because of the peak of its demand?

Although unlike their counterparts across the Atlantic, European oil companies are anticipating this collapse by projecting themselves into the production, distribution and storage of electricity, this question asked by a customer has no satisfactory answer.

In this future, their historic core business, hydrocarbon geology, no longer has a future. They therefore have the choice of abandoning it, or, before this expertise disappears from their collective memory, to reinvest these immense skills and knowledge in an industrial synergy on a scale intimately linked to the energy transition.

As we all know, the ecological transition shift our dependence on hydrocarbons to depende on metals, without metals there is no energy transition. This is why the oil of tomorrow is copper, the natural gas of tomorrow is lithium or iron.

Fortunately, history shows that both the mining and oil sectors are permeable: BHP, Glencore and other mining companies are in oil and gas energy; conversely, geologists from oil companies have discovered deposits of metals. Looking for oil is closer to finding copper, nickel or zinc than to driving photovoltaic power plants, managing marine wind farms or innovating in battery thermodynamics.

This geological bridge between oil and mines would allow oil companies that have become electric utilities to invest in the production of metals that are essential for their own energy transitions, to their new electrical activities. Indeed, metaphorically, it will be just as complementary to produce oil upstream to develop one’s own petrochemicals downstream, as it will be to develop a spodumene or copper mine to supply one’s own electricity. This is, moreover, the model of Chinese industrialists who take shares in nickel or lithium mines while they are battery manufacturers.

However, this vision is difficult to implement

The oil industry is rich of globalized oil services companies that know almost everything about oil: geology, exploration, infrastructure construction, oil exploitation, rehabilitation, etc. But the mining sector is poor in global mining services or “para-mining” companies. Without their support, it is possible that oil companies will remain timid to go ahead.

How to build this missing para-mining link? The mining suppliers in geology, exploration and exploitation of open-pit or underground mines, in services and maintenance of machines, in drilling, explosives, rehabilitation of mining sites, are often isolated and specialized, or drowned in large groups of public works, water management, recycling…

Our country has these many skills and the creation of our “paramining” would be a European first and a step ahead to serve the transformation of the oil companies of the old continent and assert a mining sovereignty.