12:00 - 1:45 PM

Luncheon and Special Address

• Robert D. Hormats, Under Secretary of State for Economics, Energy, and Agricultural Affairs

4:00 - 5:00 PM

A Dive into the Role of Climate, Renewables and Sustainability in Shaping the Redesign

• Bob Fryklund, Vice President, IHS CERA (Chair)
• Keith Hays, Senior Director, IHS Emerging Energy Research
• Scott Lockhart, VP Environmental Solutions, IHS
• James Burkhard, Managing Director, IHS CERA
• Rob Barnett, Associate Director, IHS CERA

7:30 - 8:45 AM

Africa at a Pivot Point?

• Wolfgang Moehler, Associate Director, IHS CERA
• Bob Fryklund, Vice President, IHS CERA (Chair)
• Tewodros Ashenafi, Chairman and Chief Executive Officer, Southwest Energy (HK) Ltd.
• Tiziana Luzzi, Area Coordinator, IHS

Eurasian Transport

Discussion on implications of recent developments in oil and gas transportation in Eurasia

• Matthew Sagers, Senior Director, IHS CERA (Chair)
• Nikolai Kolesnikov, Executive Vice President, Chief Strategy & Financial Officer, Sovcomflot
• John C. Webb, Director, Russian and Caspian Energy, IHS CERA

International Security and Country Risk

What are the key drivers shaping future international security environments?
How might these forces, actors, and phenomena interact to create new and novel threats and challenges to state stability, global security, and energy security?
Specifically, to what extent does al-Qaeda's strategic thinking focus on energy and shipping targets?
Is there alignment between their strategic intentions and tactical / operational capabilities?
How might competitions for resources - energy and non-energy - complicate or intensify existing security threats and challenges, as well as regional strategic competitions?
How might proliferation of advanced military technologies and a changed nuclear weapons landscape shape future calculations of political and security risk for the global energy industry?

• Tate Nurkin, Director, IHS Jane's
• Tim Pippard, Consultant, Security and Military Intelligence, IHS Jane's
• Juli MacDonald-Wimbush, Partner, Marstel-Day

Leadership Circle Breakfast: Oil Industry Challenges and Possibilities

Sponsored by Standard Chartered

• James Burkhard, Managing Director, IHS CERA (Chair)
• William Veno, Senior Director, IHS CERA
• Vera de Ladoucette, Senior Associate, IHS CERA
• Philippe Michelon, Managing Director, IHS CERA
• Peter M. Jackson, Senior Director, IHS CERA
• Paul Markwell, Senior Director, IHS CERA
• Aaron Brady, Director, IHS CERA
• Enrique Sira, Director, Latin America, IHS CERA
• Olivier Abadie, Director, IHS CERA
• Pritesh Patel, Director, IHS CERA
• Jackie Forrest, Director, IHS CERA
• Ruchir Kadakia, Director, IHS CERA
• Martin Lovegrove, Vice Chairman, Oil and Gas, Standard Chartered Bank
• Tiffany Groode, Director, IHS CERA
• Leta Smith, Director, IHS CERA
• Bhushan Bahree, Senior Director, IHS CERA
• Jeff Kelly, Director, IHS CERA
• Michael Bridden, Managing Director, Standard Chartered Bank
• Geraldine Murphy, Managing Director, Standard Chartered Bank
• Rodney Schmidt, Managing Director, Standard Chartered Bank
• Alok Sinha, Managing Director, Standard Chartered Bank
• Kevin Smith, Global Head of Oil and Gas Corporate Advisory, Standard Chartered Bank

The Emerging Arctic: Energy, Shipping, and Geopolitical Trends in the Far North

Interest in Arctic oil and gas has increased in recent years due to new estimates of the region?s resource potential and rapidly melting sea. However, complex political dynamics, technological challenges, and environmental conditions complicate hydrocarbon development in each of the Arctic sub-regions.

What is the status of Arctic hydrocarbon projects and what are the obstacles to the next wave of development?
How will ice conditions and shipping regulations impact oil and gas development in the Arctic?
How could political issues, such as ongoing territorial disputes and future subsea claims, affect hydrocarbon development?

• Matthew Clements, Russia and Eurasia Analyst, IHS Jane's
• Lawson Brigham, Professor, University of Alaska-Fairbanks
• Paul Jukes, President, MCS Kenny

The Coming E&P Revolution: Applying Predictive Technology for Operational and Strategic Transformation

What emerging technologies will help oil and gas companies predict asset behavior?
How can these solutions be applied to transform how companies operate?
What are the strategic implications for the upstream sector?

• Michael Hauser, Manager, i-field, Chevron
• Jose Jimenez, Director, Global Energy Business Intelligence Consulting Practice, Hewlett-Packard
• Paul Stone, Technology Director, BP

9:10 - 9:45 AM

Conference Opening Keynote Address

The Opening Keynote address at CERAWeek 2010 was given by Khalid Al-Falih, President and Chief Executive Officer of Saudi Aramco, who was welcomed to the conference by IHS CERA Chairman Daniel Yergin. Mr. Al-Falih described the challenges facing the world's energy industries in the context of three imperatives, which he named "The Triple-A Triangle," namely

• adequacy of energy supplies for a growing world population and world economy
• affordability of the energy required for economic prosperity
• acceptability of energy production in terms of environmental sustainability

With respect to the latter imperative, he remarked that "Stewardship is a moral duty for energy providers ... but it is also good business."

Mr. Al-Falih noted that the transformation to alternative (nonfossil) forms of energy will not be instantaneous. The growth, development, and cost of new energy technologies remain an open question. He worries that with all the emphasis on clean energy investment, a "green bubble" could be developing (analogous to the "dot-com bubble" of the 1990s, or the housing bubble of recent years) that might someday burst, with disastrous consequences. Despite this concern, he noted that Saudi Arabia is investing heavily in its "other energy resource--the sun," although the economics of solar energy are still a challenge.

Oil continues to underpin the modern economy, and underground resources of oil are plentiful, Mr. Al-Falih said. There is a danger, however, that the industry isn't making the necessary investments to prevent supply bottlenecks in future years. Fossil fuels will still satisfy 80 percent of global energy 20 years from now, and even though the percentage share of fossil fuels in the overall energy mix may decline, the absolute level of fossil fuel consumption will continue to grow as a result of population growth and rising living standards.

Mr. Al-Falih made the analogy that the world's energy should be managed in the same way that nutritionists recommend that human energy be managed--with a balanced diet, drawing on a complete range of energy sources. In this regard he recommends a "progressive and pragmatic attitude toward energy issues," recognizing the hurdles to alternative energy development; wise and timely investments in both traditional and alternative energy sources, avoiding excessive taxation and cross-subsidies; and addressing environmental issues, making oil "cleaner and greener."

With respect to Saudi Aramco's corporate goals, he discussed providing a reliable supply of energy to global markets, environmental stewardship, investments in both the upstream and downstream at home and abroad, and substantial investments also to develop human capital. Saudi Aramco now has a productive capacity of 12 million barrels per day, with a target of maintaining 1.5 million barrels per day of spare capacity. The company is investing in natural gas resources in the northern part of the kingdom, with a goal of supplying more domestic energy needs from natural gas, which would free up more oil for export. Domestic oil demand has been growing by 5 to 7 percent per year in recent years. The country would like to cut that growth in half by greater energy efficiency and by substituting natural gas for oil.

• Khalid Al-Falih, President and Chief Executive Officer, Saudi Aramco

10:15 - 11:00 AM

Global Oil Plenary

IHS CERA Chairman Daniel Yergin led Tuesday's Global Oil Plenary session, which explored the challenges of frontier exploration and production (E&P) and of maximizing output from mature fields.

Andy Inglis, Chief Executive, Exploration and Production, BP, described the challenges of frontier E&P and the relevance of international oil companies (IOCs). E&P frontiers are not only physical, but also geopolitical and environmental, he said. The challenges include overcoming complex exploration conditions, maximizing recovery, minimizing the environmental footprint, and achieving sustainability--a diverse energy mix that includes low-carbon fuels. He also cited as crucial the "X factor"--the "frontier mindset."

In frontier E&P national oil companies require IOC expertise. IOCs, governments, and businesses must form partnerships based on mutual interest, he noted. BP will continue to use leading-edge technologies to identify and unlock frontier resources and to replicate best practices around the globe.

Companies can "never afford to stand still; each frontier requires a step change in capability," he stressed. BP's latest step is into deeper water in the US Gulf of Mexico and offshore Africa. Game-changing developments in information technology, seismic imaging, and digital data are essential to this effort. Enhanced oil recovery (EOR) techniques involving low-salinity water and trials of "bright water" flooding promise to maximize recovery rates from mature fields. These technologies are being transferred to BP TNK for use in Russia's Samotlor field, where they have doubled proved reserves over the past five years. Alaska has also become a test bed for EOR, he said.

BP will turn this momentum into "sustainable delivery for the next decade," linking opportunities with the appropriate technologies to strengthen portfolios. Mr. Inglis urged companies to "make excellence the norm, prioritize the right activities, and standardize functional structure for regional businesses." BP is also developing the capabilities to use the technology fully and effectively--creating road maps for E&P professionals through its state-of-the-art learning center in Houston that transfers expertise around the world via high-definition video. Mr. Inglis concluded that the industry needs technology and strategy, but more importantly the right mindset that "wants to win, wants to lead, and won't give up."

Speaking on the importance of mature fields, Kjell Pederson, Chief Executive Officer, Petoro, said that 50 percent of oil production in 2020 will come from fields that are more than 20 years old. Assuming flat demand in 2030, a staggering 45 million barrels per day from the decline of existing fields would need to be replaced to meet global needs. Mature fields present both daunting challenges and big opportunities.

Early in Norway's oil industry, officials invited participation from international oil companies (IOCs) to benefit from the best technologies and resources available. Policymakers also made maximizing economic opportunity a primary goal. Norway has always had a strict regulatory system with a focus on safety and the environment, Mr. Pederson said. Petoro aims to maximize the financial results of its portfolio, focusing on enhanced oil recovery (EOR) in mature fields, while maintaining the highest standards of platform and equipment maintenance.

Globally there is higher production from existing fields than from new discoveries. Petoro started very early to use water and gas injection to improve recovery, establish a reservoir management plan, and continuously drill new wells and work over wells. With production facilities already in place, improved oil recovery from mature fields is good business, he said. Petoro employs intense exploration programs in the areas around big fields, "vacuum cleaning" all possible reserves in the area. The uncertainties of EOR in mature fields include applying the right technologies to drive these reserves out, such as "bright water": "If it works elsewhere, why not use it?"

Mature fields are essential in meeting world oil demand. The biggest challenge, concluded Mr. Pederson, is lack of an obvious trigger for creating a sense of urgency to invest in these fields before it is too late.

With Dr. Yergin, David Hobbs, IHS CERA Vice President and Managing Director of Global Research, led the question and answer session, which focused on the long-term need for fossil fuels, the role of technology in frontier and mature fields, and production potential in Iraq and the North Sea.

• Daniel Yergin, Chairman, IHS CERA (Chair)
• Kjell Pedersen, President & Chief Executive Officer, Petoro S.A.
• Andy Inglis, Chief Executive, Exploration and Production, BP

11:20 AM - 12:45 PM

What's Next for Biofuels? Beyond the Hype

What can realistically be expected from next generation biofuels, and how soon?
What are the new technologies that industry is focusing on and why?
Has the economic downturn impacted the outlook for biofuel investment and development?
How is the involvement and participation of oil companies in the biofuel industry impacting the industry?

• Aaron Brady, Director, IHS CERA (Chair)
• Tiffany Groode, Director, IHS CERA
• Thomas Eizember, Planning Division Manager of Corporate Strategic Planning, Exxon Mobil Corporation
• Jeffrey Jacobs, Vice President, Chevron Technology Ventures, Chevron Corporation
• Greg Stephanopoulos, W.H. Dow Professor of Chemical Engineering and Biotechnology, MIT

China Oil Demand - Where Is It Going?

At Tuesday's Strategic Session China's Oil Demand: Where Is It Going?, IHS CERA Senior Director Mark Hutchinson asked the panelists to address two broad questions: How fast will China's oil demand grow, and what will be the main drivers for future growth?

K. F. Yan, IHS CERA Director, said that transportation and petrochemicals will drive China's future demand. Mr. Yan cited 2009's soaring automobile sales resulting from government tax incentives, which enabled China to overtake the United States as the world's largest auto market. Auto sector growth will follow the rise in income levels rise as residents from China's inland, second-tier cities join their urban counterparts in private car ownership. The oil sector is challenged in supplying the fuel required to support this growth, and fuel substitution--including electricity, natural gas, and biofuels, among others--will be crucial. Petrochemicals will also grow significantly as demand for ethylene and other petroleum-derived chemicals increases--another direct consequence of China's anticipated continuing rise in income and in standard of living.

Britta Gross, Director of Global Energy Systems and Infrastructure Commercialization at General Motors (GM), pointed out that China's per-capita automobile ownership is still very low compared with that of developed markets; therefore the growing middle class will continue to drive robust automobiles sales. She discussed the supply challenge in fueling China's growing auto fleet and GM's aim to deploy various technologies in different parts of the world. GM's overall technology strategy focuses on efficiency, substitution, and electrification and includes improving the internal combustion engine to increase fuel economy and using alternative fuels such as ethanol, biodiesel, compressed natural gas, and liquefied petroleum gases, as well as electricity and hydrogen. Ms. Gross foresees a near-term transition period when multiple vehicle technologies will coexist, necessitating companies like GM to maintain a broad portfolio. She concluded by highlighting the need for governments, the energy and auto industries, and the public to collaborate to improve mobility sustainably.

Jörg Wuttke, Chief China Representative of BASF, said that "China sets the pace." He presented BASF's view on Asian economic growth, noting that China will lead the way. He expects Chinese demand for petrochemicals to account for a fifth of the world's total by 2020, and he highlighted the opportunities for sector players. Mr. Wuttke cited urbanization as the most significant driver of petrochemicals growth. By 2025 there will be more than 220 Chinese cities with more than a million inhabitants, meaning that China's urban population will constitute 15 percent of mankind. The urbanization trend will also drive demand for infrastructure and all goods and services. Mr. Wuttke discussed BASF's 130-year history in China and its major projects in the country. In conclusion he highlighted BASF's strategy to move inland to capture the vast potential of emerging provinces and emphasized BASF's intention to stay and grow in China.

Mao Jiaxiang, Vice President, Economics & Development Research Institute, Sinopec, noted China's contribution to the global manufacturing market with its low-cost labor and energy as well as low cost of capital. China's rapid manufacturing growth has driven tremendous demand for petroleum products. Its soaring economic growth and the associated expansion of the ethylene derivatives market have supported the rapid development of its ethylene industry. Owing to the growing auto population, the ethylene sector has also started to produce more diesel. Mr. Mao mentioned the rapid growth of China's para-xylene industry, which expanded on average by 27.3 percent annually in the past five years. Sinopec expects ethylene capacity to increase significantly in China to meet growing demand, with 7.5 million metric tons (mt) per year in capacity additions from 2010 to 2015 and another 4.9 mt per year in additions from 2015 to 2020. However, even that expansion will not prevent a shortfall in supply.

The panelists answered questions from the audience on the drivers of China's future oil demand and infrastructure for the growing vehicle fleet.

• Mark Hutchinson, Senior Director, IHS CERA (Chair)
• Britta Gross, Director, Global Energy Systems & Infrastructure Commercialization, General Motors
• Ke Feng Yan, Senior Director, IHS CERA
• Jörg Wuttke, Chief Representative China, BASF (China) Company Ltd.
• Jiaxiang Mao, Vice President, Sinopec Economics & Development Research

Global Upstream M&A: Post-Recession Strategies for Success

As the energy industry emerges from recession, what is the potential for consolidation? Leading energy finance experts will provide an overview of the energy investment landscape in 2010 and beyond to discern winning strategies and opportunities.
Will Chinese NOCs change strategies as they face increasing resource protectionism by host countries?
Balancing the current commodity price environment with a longer-term outlook, what upstream plays (Deepwater, Unconventional North American gas, Canada oil sands, Australian Coalbed Methane/Asia-Pacific LNG) and global regions will increasingly be the focus of M&A or command premium deal pricing?
What blend should acquirers seek between focusing organic and M&A efforts on mature proven assets versus identifying and differentiating exploration-focused horizon resource takeover targets that can prospectively move the needle on growth?

• Clay Seigle, Director, CERAView Institutional Investor Service, IHS CERA (Chair)
• Christopher Sheehan, Director of M&A Research, IHS Herold, Inc.
• Sara Akbar, Chief Executive Officer, Kuwait Energy Company
• Adrian Goodisman, Co-Head, U.S. and Managing Director, Scotia Waterous
• J. Robert Maguire, Partner, Perella Weinberg Partners UK

US Energy Policy and Global Markets

• James Burkhard, Managing Director, IHS CERA (Chair)
• Ernest Moniz, Cecil and Ida Green Professor of Physics and Engineering Systems, MIT
• Karen Harbert, President and CEO, Institute for 21st Century Energy, U.S. Chamber of Commerce
• Mark Finley, General Manager, Global Energy Markets, BP
• David Goldwyn, President, Goldwyn Global Strategies LLC & Former Special Envoy for International Energy Affairs, US Department of State

The Intersection of Oil Sands and GHG Policy: Balancing Act

How could current climate change policy impact future development of oil sands productive capacity?
What are the short and long term costs?
How much reduction in CO2 could come from energy efficiency projects?
How much CO2 reduction could come from the development of less energy intense production methods?
How much reduction could come from CCS?
What are the other constraints to production growth?

• Jackie Forrest, Director, IHS CERA (Chair)
• Robert LaCount, Senior Director, IHS CERA
• Marlo Raynolds, Executive Director, The Pembina Institution
• Jean-Michel Gires, President and Chief Executive Officer, TOTAL Canada
• Wishart Robson, Advisor to the Chief Executive Officer, Nexen

Russian Oil Outlook: Industry Responses to Rapidly Changing Conditions

How have the Russian oil companies fared during 2009 under rapidly changing conditions?
Have the various tax holidays and other adjustments in the tax regime improved incentives for oil investment?
What is your outlook for Russian oil production in the medium and long term, given the balance between new field development and accelerating decline in legacy fields?

• Thane Gustafson, Senior Director, IHS CERA (Chair)
• Matthew Sagers, Senior Director, IHS CERA
• Alexander Pankratov, Head of Business Development, E&P, Gazprom Neft

Strategic Challenges Facing Upstream and Downstream Construction: From Shortages to Surplus

• Pritesh Patel, Director, IHS CERA (Chair)
• Cesar Palagi, Asset Manager, Petrobras
• Motaz Al-Mashouk, Manager, Project Support and Controls Department, Saudi Aramco
• Troy Thompson, Market Intelligence Manager, Chevron Corporation
• Joseph Owusu, Market Intelligence Manger, Hess

1:30 - 2:30 PM

Luncheon and Keynote

At Tuesday's luncheon, Daniel Yergin, IHS CERA Chairman, welcomed keynote speaker James J. Mulva, Chairman, President, and CEO of ConocoPhillips, to CERAWeek 2010. Mr. Mulva opened with a reference to Dr. Yergin's Pulitzer Prize-winning book, The Prize, stating that it illuminated the fundamental truth that oil is a precious commodity fueling the global economy. He went on to say that if oil is "The Prize," then natural gas is "The Gift" because it has emerged as an abundant source of energy that will become an integral part of the national and global energy future. Mr. Mulva characterized the comparative advantages of natural gas as its cleanliness, abundance, and reasonable cost and noted that gas is the critical reserve fuel that enables renewable, intermittent energy sources like wind and solar to be viable.

Mr. Mulva cited two major obstacles to gas's taking its rightful place as a fuel of choice in the global energy economy. First, gas must overcome the opposition of "hydrocarbon deniers," whom Mr. Mulva described as well-intentioned people who "support renewables at any cost and oppose hydrocarbons at any consequence." Mr. Mulva commented that their specific grievances over economic reliance on hydrocarbons--price volatility, environment impact, and greenhouse gas emissions--may sound compelling at first, but he encouraged the audience to think critically about the obstacles to successfully deploying renewable energy sources and reconsider the benefits of gas.

Second, Mr. Mulva emphasized that the US government must establish coordinated energy policies that engender certainty throughout the years, regardless of changes to the balance of political power. As an example he explained that the current US government policy strongly supports renewable energy but also proposes higher taxes on natural gas--the very fuel that has the potential to become an essential hydrocarbon backstop for renewables. Mr. Mulva also pointed out that although the US government holds 2.4 billion acres of mineral estate, it has leased only 3 percent for energy development. He encouraged the audience to consider the implications of that fact given that the revolution in unconventional gas development that has become a game changer for the US gas market in recent years occurred primarily on state- and privately owned territory.

After Mr. Mulva's speech, Dr. Yergin asked him about the role of the oil and gas industry in the US economy. Mr. Mulva explained that millions of jobs in the United States are related to oil and gas and that further development of natural gas could create even more jobs at a time when the United States is grappling with high unemployment. Dr. Yergin then asked Mr. Mulva about how ConocoPhillips values oil and gas: "Do you see Conoco as an oil and gas company or a gas and oil company?" Mr. Mulva replied that ConocoPhillips is focused on upstream exploration. When the company drills wells, it hopes to discover large reserves, either oil or gas.

• James J. Mulva, Chairman, President and CEO, ConocoPhillips

4:35 - 6:00 PM

What is the Future of Oil Demand and Markets: Rough Landing or Taking Off?

IHS CERA Managing Director James Burkhard opened Tuesday afternoon's Strategic Session on the future of oil demand and markets by noting the several tumultuous years of exceptional oil price volatility and a global recession. These events have drastically affected demand and the structure of global markets. Future oil demand is difficult to project, since demand is subject to the volatility of economic growth, government policy, and technological innovations--all topics in this session.

Edgar H. Habib, Chief Economist, Chevron, set the stage for his fellow panelists with an overview of the global economy and oil demand, both past and future. He quoted the earlier address by Hon. Steven Chu, US Secretary of Energy, who said that "the train has left the station" regarding energy and climate change policy; but   Mr. Habib noted it could take as long as ten years to see the total impact. Instead, he suggested analyzing the historical correlation between oil demand and economic growth, and applying it to the context of both where we are right now and future economic growth. He subscribes to the triple "L-U-V" economic recovery path, which calls for a flat recovery in the euro zone, moderate recovery in the United States, and a sharp recovery in China. In the current environment he considers debt and credit as the biggest issues in the near term. Debt levels affect capital expenditure trends and employment levels, while on the other side "no credit leads to no growth" and a lack of confidence in the economy. Ultimately, the $2.4 trillion in foreign reserves that China holds and the emergence of the middle class in Asia will lead to a "rebalancing of world demand tilting to Asia." In addition, commodities have gone global and are in a bull market structure which has also led to a tilt toward Asia. To conclude he discussed the future of the US dollar by stating, "There is no alternative to the dollar."

Marianne Kah, Chief Economist, ConocoPhillips, approached the discussion by talking about what economic growth means to the future of oil demand in the OECD and non-OECD. Two areas of concern in the OECD include long-term economic growth and what happens if debt levels get too high; regarding debt some countermeasures could create higher taxes and excessive regulation that choke off growth. In the non-OECD China's ability to move away from an export economy will have an impact on energy demand growth patterns. The shift in economic consequence from advanced to developing nations, in particular China, has lead to a loss in the OECD of roughly 4 mbd since 2007. A combination of benign economic growth, new policy legislation, and demographics has led to a peak in oil demand in the OECD. On the product side, demand in the OECD equals the end of "destocking," with industrial production in a recovery, which spurs diesel demand. Regarding gasoline demand she commented that price has been elastic, comparing the growth of vehicles miles traveled, economy, and price. In addition hydrocarbon gasoline demand is not expected to grow and will "hit a blend wall" as it will be difficult for ethanol blending mandates to be met. Electric vehicle interest and sales will depend on a combination of battery cost and consumer preference; she compared studies in which electric vehicle sales ranged between 2 percent to over 50 percent by 2030. In the non-OECD population and income growth will be the main drivers of demand for personal passenger vehicle ownership as "China and India can expect exponential passenger vehicle growth." Rising urbanization will also play a role in increasing non-OECD oil and energy consumption.

Edward Morse, Head of Global Commodity Research, Credit Suisse, took a macro perspective by asking what historical trends tell us about oil demand and what this means for the future. The global recovery currently under way will lead to higher oil demand, but doesn't necessarily mean higher prices. He said that in the historical relationship between gross domestic product (GDP) and oil demand growth over the past two decades, you could take the GDP growth rate and subtract 2.3 to get a proxy for oil demand growth. Global oil consumption has fallen after every price spike; in Europe and Japan after 1973, Korea in 1998, and now it appears in the United States also. Looking to the future three critical markets affecting oil demand will be the Middle East, China, and the United States. Post-2003, the Middle East was a pillar of demand growth as regional product demand grew by 40 percent during 2000-08, propelled by high GDP, demographic growth, and price subsidies. Fuel oil was a significant driver as power demand for the construction of large development projects increased; however, he did not expect a similar increase in regional power demand in the future. In China the latest data show no growth in middle distillate demand in the past year as the country focuses on doing away with subsidies for energy-intensive production. The main driver in Chinese demand has been the agreement between government and companies to lock in a permanent surplus in refining capacity and margins, which will ultimately lead to higher crude imports and product exports. He agreed with Ms. Kah's comments on the United States.

Olivier Abadie, Director IHS CERA, concluded the panel by discussing the oil and gas price relationship, and the impact this could have on future demand. In fact, natural gas matters more to oil demand than biofuels, which have only reduced oil demand by slightly more than 1 mbd over the past decade compared with the 4 mbd that were replaced by natural gas. The high oil-to-gas price ratio could eventually support strong natural gas vehicle sales as a component of transportation sector. In terms of fuel availability, because natural gas can be considered a cleaner fuel compared to gasoline, emissions policies come into play to support greater use.

The panel answered questions on the downside risks in the return of global economic growth, the past and future oil price path, downstream rationalization, spot prices, two-speed demand growth, and possible defaults in Europe, among other topics.

• James Burkhard, Managing Director, IHS CERA (Chair)
• Olivier Abadie, Director, IHS CERA
• Edgard Habib, Chief Economist, Chevron
• Marianne Kah, Chief Economist, ConocoPhillips
• Edward Morse, Managing Director & Head of Commodities Research, Citi Group (Effective May 2011)

Ensuring Capacity in the Supply Chain: What's Different This Time for the Service Industry?

Why have oilfield equipment and services costs not dropped as much as anticipated?
What strategies are open to suppliers to reduce costs or lower prices?
What limits their ability to lower costs?
What actions have oilfield equipment and service companies taken in response to the downturn?
What are the consequences when demand returns and companies need to ramp up again?
How have the labor and engineering personnel been affected by the recent downturn?
Will labor shortages be seen again in the near future?
Will new technology advances suffer in light of the current climate?
Who will invest in developing the new technologies required for deepwater and shale gas?
As activity levels increase again how are companies positioning to meet the increase in demand?
Is this current downturn an opportunity for SE Asia suppliers to enter the market place?

• Candida Scott, Senior Director, IHS CERA (Chair)
• Maroun Semaan, Group Chief Operating Officer, Petrofac
• Timothy Probert, President, Global Business Lines and Corp. Development, Halliburton Company
• Louis Raspino, Chief Executive Officer, Pride International
• Brad Dickson, VP and Chief Marketing Officer, Dresser-Rand

Reassessing the Politics and Economics of the Middle East

How will the economic recovery unfold in the Middle East?
What is the potential for the security situation in Iraq to become unstable?
What is the future of Iranian influence in the region?

• Bhushan Bahree, Senior Director, IHS CERA (Chair)
• Vera de Ladoucette, Senior Associate, IHS CERA
• James Placke, Senior Associate, IHS CERA
• Brad Bourland, Chief Economist, Jadwa Investment
• Douglas Hengel, Assistant Secretary for Energy, Sanctions, and Commodities, United States State Department

The Implications of GHG Regulations for the Oil Industry

A myriad of GHG-related regulations have been proposed that would affect the oil industry: fuel economy standards, ethanol and biofuel mandates, low carbon fuel standards (LCFS), cap-and-trade, and carbon taxes.

What mix of regulation is likely to unfold as governments finalize policies that address GHG emissions?
What are the major risks and opportunities that GHG regulations pose for different parts of the oil value chain?
Given policy uncertainty, how are oil companies managing these policy risks today?

• Rob Barnett, Associate Director, IHS CERA (Chair)
• Aaron Brady, Director, IHS CERA
• Antonio Pietri, Executive Vice President, Field Operations, Aspen Technology, Inc.
• William Koetzle, Manager of Legislative and Regulatory Affairs, Chevron Corporation
• Sabrina Watkins, Manager, Sustainable Development, ConocoPhillips

Unlocking Value in Latin American Oil Reserves

In recent years many of the largest discoveries worldwide have taken place in Latin America. Despite its large hydrocarbon potential, Latin America continues to find numerous challenges when it comes to developing its hydrocarbon resources. Departure from market oriented regulations in traditional oil exporting countries coupled with an unprecedented global economic crisis places a question mark on the region?s ability to attract much needed investment funds, technological resources and know-how.

Key Questions. What will be the future role of state sponsored investors in the region?
Are the skills, know how and financial backing they will bring into the region a good match?
What will be the likely level of government intervention going forward and how will it impact future developments in the region?
What is the key to value creation in frontier provinces like presalt in Brazil?
What are the challenges?
What main changes are needed in order to attract and secure needed capital and technological resources needed by the region?
Who will be the winners in the capital allocation race and how will the balance of power shift with the emergence of new producers in the region?

• Enrique Sira, Director, Latin America, IHS CERA (Chair)
• Alireza Moshiri, President, Africa and Latin America E&P, Chevron
• Bob Fryklund, Vice President, IHS CERA
• Javier Gutierrez, President, Ecopetrol S.A.
• Luis Giusti, Chief Executive Officer, Alange Energy

7:00 - 9:00 PM

Dinner and Keynote

<>At Tuesday's dinner IHS CERA Chairman Daniel Yergin,thanked the CERAWeek Strategic Sponsors Eni and Chevron Corporation and welcomed keynote speaker Paolo Scaroni, Chief Executive Officer, Eni. Mr. Scaroni began his address by stating that "the big issue today is no longer volatility in oil, but volatility in the natural gas market". He noted that natural gas is an increasingly important part of the world's energy future and is central to Eni's business strategy. Mr. Scaroni said that "the gas market has undergone something of a revolution," indicating on one hand the emergence of shale gas and on the other the global demand collapse caused by the economic recession. These two factors have provided the gas market with plentiful supply and also sparked a collapse in gas prices to about one third of their peak level. Mr. Scaroni stated, however, that concerns about security of supply remain extremely important, explaining that low gas prices coupled with the global economic recovery are expected to stimulate a bounce back in gas demand. He also believes that greater use of natural gas is the best way to combine economic development and environmental preservation, saying that "gas is by far the cleanest fossil fuel, emitting 50 percent less carbon dioxide than coal and 30 percent less than oil when used to generate one kilowatt-hour" of electricity. Mr. Scaroni also said that gas can also complement renewable energy by providing "swing capacity."

Mr. Scaroni warned that the world needs to prepare for a tight gas market, higher prices, and concerns about security. He said that this will particularly affect the European and Asian markets, but not the North American market, thanks to shale gas.

Regarding the European market Mr. Scaroni said that "establishing interconnections, developing complementary supply sources, and strengthening existing and new supply corridors are all necessary measures to ensure that Europe has ample, affordable, and secure gas supplies." He noted that diversification will remain an important objective for EU security of supply strategy and can be achieved by developing complementary supply sources and diversifying gas transit routes. He advocated liquefied natural gas as a third pillar of Europe's diversification strategy and an important channel for Asia but underscored the need for substantial investment, noting that "the average liquefaction plant costs somewhere in the region of $1 billion per billion cubic meters."

In response to questions from Dr. Yergin, Mr. Scaroni said that until renewable energy sources gain greater market share, greater energy efficiency--particularly in the United States--is paramount. Regarding the transportation sector Mr. Scaroni expressed optimism about market penetration of hybrid vehicles but doubt about plug-in electric vehicles, citing lingering issues with energy storage. On the evolution of resource nationalism, he pointed out Eni's distinctive approach of working with host governments to invest in countries where Eni operates. He particularly highlighted Eni's leadership in electricity production in oil-producing countries. Regarding Iran Mr. Scaroni said that Eni will not be signing any contracts with Iran going forward; the last contract was in 2001. He is optimistic regarding Iraq's prospects of effectively rejoining the energy market and mentioned Eni's recent engagement in two Iraqi fields: Nassriya and Zubair.

• Paolo Scaroni, Chief Executive Officer, Eni

7:30 - 8:45 AM

Global Gas Surplus: Will It Drive Structural Changes? How Partnering, Joint Ventures and Alliances Provide a Competitive Advantage

Sponsored by Vinson & Elkins LLP

• Matthew Sagers, Senior Director, IHS CERA (Chair)
• John B. Connally IV, Partner, Vinson & Elkins LLP
• Robert Ineson, Senior Director, IHS CERA
• John Harris, Director, IHS CERA
• Shankari Srinivasan, Managing Director, IHS CERA

Leadership Circle Breakfast: Gales, Blizzards, and Economic Cycles - What is the Outlook for Russian-European Gas Relations?

• Thane Gustafson, Senior Director, IHS CERA (Chair)

China's Gas Gap: IHS CERA Insights

• Wolfgang Moehler, Associate Director, IHS CERA
• Mark Hutchinson, Senior Director, IHS CERA (Chair)
• Xizhou Zhou, Associate Director, IHS CERA
• Leta Smith, Director, IHS CERA
• Katherine Hardin, Senior Director, IHS CERA
• Ke Feng Yan, Senior Director, IHS CERA

The Future of Natural Gas in Latin America: The Strategic Imperative

As Latin America economic recovery consolidates and major world economies enter into a more stable growth trend, the strategic imperative of developing new reserves and LNG infrastructure in the region gains force. Recent investment trends and the surge of state oriented regulations, however, suggest that the region seems ill prepared to face this challenge despite hosting one of the largest reserve bases in the world and many of the largest gas discoveries that have taken place in the last years.

Is the region ready for the economic rebound in terms of the development of new sources of supply, and the timing for bringing this supply online?
What are the main factors that drive demand growth in the region and how are they likely to evolve in coming years?
Will LNG flexibility continue to be favored over pipeline regional integration efforts?
What are the main challenges when it comes to developing new sources of supply in the region?
What nations will be favored when it comes to attracting capital to develop underground resources?
How will the balance between state oriented and market oriented reforms going forward?
Who will be the main gas producers in the region by 2020?

• Daniel G. Gerold, Senior Associate, IHS CERA
• Lisa Pearl, Director, IHS CERA (Chair)
• Luis Augusto Yepes, Senior Associate, IHS CERA
• Mickey Peters, Senior Associate, IHS CERA
• Carla Cohen, Associate, IHS CERA
• Verónica Vázquez Hurtado, Associate Director, IHS CERA

Thirsty Energy: The Looming Urgency Over Water Resources and What it Means for Energy

Water is critical to nearly all forms of energy. Water cools electric power plants, irrigates crops used to produce biofuels, and is pumped underground to open rock formations for natural gas production. The energy industry's share of water is likely to be squeezed in the future, as growing populations and demand from other industries strain the world's water resources.

The panel will discuss the following questions:
How will the energy sectors share of water use change in the future?
What metrics on water use make sense for the industry, given the local nature of water resources and its differing value from place to place?
How can the energy industry engage with other stakeholders to shape water policy?
How can the energy industry become better integrated with other water users to optimize water use and re-use?

• Samantha Gross, Director, IHS CERA (Chair)
• Peter Gleick, President, Pacific Institute
• Arnold Smith, Vice President of Technology, Fluor Corporation
• Scott A. Weaver, Manager, Strategic Policy Analysis, American Electric Power Company

Energy Innovation Pioneers: Reshaping the Energy Future - Sponsored by The Wall Street Journal

Showcasing new companies in biofuels, efficiency and E&P technology.

• James Rosenfield, Senior Vice President, IHS; Co-Founder, IHS CERA (Chair)
• Gordon Sharp, Founder and Chairman, Aircuity
• Mitch Tyson, CEO, Advanced Electron Beams
• Peter Duncan, President and CEO, MicroSeismic
• John Scott, CEO, Petroalgae
• Corban Tillemann, President & CTO, Iris Engine
• Daniel Monticello, Chief Technology Officer, GlycosBio
• Paul Deutch, Chief Operating Officer, Foro
• Timothy Vail, President & CEO, Accelergy
• John R. Grizz Deal, CEO, Hyperion Power Generation

IHS Global Scenarios Overview: Global Redesign, Metamorphosis, and Vortex (only available to IHS Scenarios clients)

This session is only available to IHS Scenarios clients. If interested, please contact Dalton Perras at dalton.perras@ihscera.com or +1 617 866 5101

• James Burkhard, Managing Director, IHS CERA (Chair)
• Nariman Behravesh, Chief Economist, IHS (Chair)

11:15 AM - 12:45 PM

Caspian Gas Reaches New Export Markets

2009 was a year of change for the Caspian gas industry: Azerbaijan emerged as a gas exporter to Russia and the first gas pipeline connection between Central Asia and China was inaugurated. In addition, gas from Northern Iraq has emerged as a contender for exports west, along with Azeri and Central Asian gas. This session will discuss the likely long-term implications of these new trading dynamics.

What will be the long-term effect of increased exports of Central Asian gas east instead of north?
How will Iraqi and Azeri gas reach Europe, and when?
How much gas will China need from Central Asia, and can the region avoid forming a new dependence on a single market?

• Katherine Hardin, Senior Director, IHS CERA (Chair)
• John Harris, Director, IHS CERA
• Xeufeng Jiang, Deputy Chief Engineer, CNPC Research Institute of Economics & Technology
• Tuncay Babali, Fellow, Harvard Weatherhead Center for International Affairs
• Oktay Sen, General Manager, OMV G&P Turkey

LNG in a More Competitive Gas Market

As the global gas market struggles to manage burgeoning supplies, how will the LNG industry adapt?

• Robert Ineson, Senior Director, IHS CERA (Chair)
• Rafael McDonald, Associate Director, IHS CERA
• Daniel Muthmann, Vice-President Global LNG Supply, E.ON Ruhrgas AG
• Rosemary Boulton, President, Kitimat LNG
• Benjamin Palomo Sanz, Executive Director of LNG Business, Repsol YPF S.A.

The Midstream in the New World: Investment Risks and Opportunities

What are the opportunities and risks to the midstream sector flowing from the Shale Revolution? What other opportunities and risks are there in the midstream sector? How has the financial crisis of 2008-09 affected investment decisions in the midstream, in both the short term and long term? What are likely to be the key drivers for midstream valuations?

• Kenneth Yeasting, Senior Director, IHS CERA (Chair)
• Thomas Lane, Partner, Energy Capital Partners
• Bruce Bilger, Senior Advisor, Lazard
• Gregory Harper, Senior Vice-President and Group President, CenterPoint Energy
• Stu Porter, Founder, Chairman, and CEO, Denham Capital Management
• Nathan Ticatch, Vice Chairman, PetroLogistics LLC

The North American Shale Gale: The Future of Unconventional Gas

In the Strategic Session "The North American Shale Gale: The Future of Unconventional Gas," Pete Stark, Vice President, IHS CERA (Chair); Jonathan Parry, Director Global Gas Supply, IHS CERA; Bill Scoggins, President of the Colorado School of Mines; Sam Langford, Vice President Corporate Development, Newfield Exploration; and Richard Stoneburner, President and Chief Operating Officer, Petrohawk Energy Corporation, spoke about the prospects and challenges ahead. The "shale gale" has developed into a true game changer in North America, with strong global implications. The panelists agreed that shale gas is both abundant and economic. Its growth over the past three years has transformed and revolutionized the location of gas supplies and production techniques in North America.

Sam Langford provided background on Newfield Exploration. A global company and top 20 gas producer and top 15 rig operator in both conventional and unconventional areas, Newfield Exploration (Newfield) was an early mover into shale gas development. Beginning in 2005 in the Woodford Shale in Oklahoma, Newfield has driven extreme growth in US shale gas production using far fewer rigs than previous producers.

Despite a collapse in active rigs in 2008 and into 2009, supply has remained resilient, thanks to the highly effective horizontal rigs which account for 60 percent of the current active fleet. Going forward, Mr. Langford said, Newfield aims to harvest cash flow from its conventional assets while focusing on investment in prospective shale plays. The company expects that shales will reach their full potential, with unconventional production accounting for the majority of Newfield's capital budget and production volumes, in 2010.

With a focus on the five-year time horizon, Newfield believes that the sustained widening of the oil-to-gas price ratio caused by the collapse in gas prices will driving future shale activity. To take advantage of the current price environment there is a focus on adding oil-rich areas to the portfolio, including the Williston Basin, the Bakken, the Maverick Basin (Eagle Ford Shale), Southern Alberta, and the Marcellus. Through organic growth, very active hedging, and living within cash flow, Newfield expects production to maintain its path for future growth.

Jonathan Parry explained the results of two IHS CERA detailed studies, Cream of the Crop and Fueling North Americas Future, on unconventional gas in North America. Growth in production over the past few years was led by the major shale plays, and this resource shift is expected to lead future North American supply. In the short term the increase in rig count since mid-2009 will lead to strong supply throughout 2010 and into 2011 until supply growth is constrained by demand. Shales with breakeven costs in the $3-$4 per MMBtu range are expected to disappoint because they are too large, Mr. Parry said. With currently an insufficient market to absorb the abundant shale resources, shale's full potential is not expected to be met. IHS CERA estimates a weighted average cost of supply in 2010 of $4.80 per MMBtu, with shale gas to the low side.

When matched to current and expected demand, the enormous potential of the shale gas resources are limited. The impact is expected to cause a shakeout in the industry, with increased focus on the sweet spots or core areas of the plays along with reductions in drilling, predominantly in higher cost areas such as the Rockies and the Permian Basin, he said. Strong gas-on-gas competition is expected to lead this dynamic across North America, reshaping traditional pipeline routes and gas flows to match competing supply to demand centers.

Bill Scoggins described how technology has enabled the rapid development of the industry and the soaring growth in supplies. Three years ago, the Haynesville and Marcellus, two of the largest shale plays, were not even on the unconventional gas map and until recently; resource estimates did not even break out a shale gas category. The Colorado School of Mines (CSM) continues to monitor the technological development of the successful pairing of horizontal drilling in multistage fracturing. Mr. Scoggins said that the elements to geologic success are thickness, organic richness, maturation, gas-in-place, permeability, pore pressure, brittleness, and mineralogy. Despite a deep and growing understanding of shale gas, challenges to development remain. Producers cannot simply extrapolate conventional development techniques to unconventional reservoirs. Reservoir management, reservoir engineering, and stimulation and completion are areas for optimization. "A shale is not a shale," said Mr. Scoggins, as there is considerable variation among and within plays. Top research priorities for the CSM and the shale gas community are reservoir characterizations, stimulation, environmental impacts/effects (optimizing water use and developing recycling techniques), access, monitoring (seismic/micro seismic), simulation and modeling (fluid and flow mechanics), and public outreach and education. Shale gas has significant potential for growth, Mr. Scoggins said, and technological strategies will enhance its profitability and future potential.

Richard Stoneburner said that just a few months after completing its first well in the Fayetteville in February 2007, Petrohawk Energy Corporation (Petrohawk) made the strategic shift from conventional producer to shale company. Having sold its nonshale assets, Petrohawk has concentrated on four main areas: the Haynesville in North Louisiana, the Bossier which overlies the Haynesville, the Fayetteville in Arkansas, and the Eagle Ford in South Texas.

High initial production volumes from the plays have significantly increased production levels, and drilling to protect leaseholds in 2010 and 2011 will continue to spur production, Mr. Stoneburner said. First mover advantage has allowed Petrohawk to secure hundreds of thousands of acres in the leading shale plays.

• Pete Stark, Vice President Industry Relations, IHS CERA (Chair)
• Jonathan Parry, Director, IHS CERA
• Richard Stoneburner, President and Chief Operating Officer, Petrohawk Energy
• Bill Scoggins, President, Colorado School of Mines
• Samuel Langford, Vice President, Corporate Development, Newfield Exploration Company

Middle East: Meeting the Energy Needs

What is the position of natural gas in the future fuel mix in MENA?
How are MENA countries facing tradeoffs between local gas monetization (with macro-economic drivers) and gas exports?
Is there space for regional gas trade, not necessarily by pipeline?
If $1 gas is a matter of the past, is there a new benchmark for domestic gas pricing in the region?

• Andy Barrett, Senior Associate, IHS CERA
• Leila Benali, Director, IHS CERA (Chair)
• Ahmed Al-Khulaifi, COO Commercial & Shipping, QatarGas Operating Co. Ltd.
• Ahmad Sharaf, Chairman of the Board, Dubai Mercantile Exchange
• Khalil Al Shafei, Interim President, King Abdullah Petroleum Studies and Research Center (KAPSARC)

Sustainability: To What Extent Will it Drive Future Energy Strategy?

What are the key principles of sustainability?
How are these principles integrated into energy-related businesses?
What are the implications for current business models if sustainability has sticking power?

• Susan Ruth, Senior Director, IHS CERA (Chair)
• Samantha Gross, Director, IHS CERA
• Steve Fludder, Vice President, Ecomagination, General Electric Corporation
• Jean (Pogo) Davis, Principal, JDK Consulting LLC
• Mitch Jackson, Staff Director, Environmental Affairs, Sustainability, FedEx
• Rob Bernard, Chief Environmental Strategist, Microsoft

Future of Automotive Transportation: The Roadmap to Sustainable Mobility

What does the roadmap to sustainable mobility look like? What is the role of government in facilitating a transition to alternative fuels and fuels? How does consumer choice play into which technologies will win or lose?

• Tiffany Groode, Director, IHS CERA (Chair)
• John Viera, Director, Sustainability & Environmental Policy, Ford Motor Company
• Britta Gross, Director, Global Energy Systems & Infrastructure Commercialization, General Motors
• Minoru Shinohara, Senior Vice President, Technology Development Division, Nissan
• Lee Schipper, Precourt Energy Efficiency Center, Stanford University

Tanker Market Turmoil: Challenges and Strategies for Rough Seas

The world (oil) tanker industry has been struggling to stay afloat under the weight of a sharp downturn in shipping activity caused by the sagging global economy and weak oil demand. Vessel fixtures have fallen sharply and rates have fallen correspondingly for all vessel sizes as a result of the current weak market fundamentals. Notwithstanding the few signs of economic recovery that have been reported, the tanker industry is facing some formidable challenges in the years ahead. The spike in oil prices in 2008-2009 ? that helped precipitate the abrupt drop in global oil demand and intensified support for the development of more efficient vehicles, tighter limits on CO2, and behavioral changes by consumers ? may have altered the intensity of oil demand so that, even after the global economy has recovered, the demand for oil does not rebound and resume its pre-recession level or pace of growth. In this event, the ?tide that lifts all boats? (and would otherwise have helped set the tanker market back on its feet) may be a decidedly lower ?tide? than the industry needs to fully recover. Further down the road, but yet in sight, are regulations affecting the allowable sulfur in vessel bunker fuels ? that could spell significant increases in shipping costs, affecting tanker companies, the rest of the oil industry value chain and consumers alike. In this session, speakers from within the tanker industry representing a broad range of perspectives on the tanker market will share their views on the challenges ahead, the approaches that are being taken, and how the industry may evolve over the next 10-15 years.

• William Veno, Senior Director, IHS CERA (Chair)
• Christopher Pålsson, Director, IHS Fairplay
• Erik Hånell, Vice President & Head of Stena Bulk USA, Stena Bulk AB
• Colin Cridland, Managing Director, Clarksons PLC
• John Hatley, Americas VP Ship Power, Wartsila North America, Inc.

2:00 - 2:50 PM

IHS CERA Insights: The Landscape Ahead for Energy and the Economy

Opening Wednesday's IHS CERA Insights: The Landscape Ahead for Energy and the Economy, moderator David Hobbs, IHS CERA Head of Research, challenged nine top IHS CERA experts to pack as much insight into three minutes as they possibly could. In the rapid-fire tour of the world by fuel and region the hour-long session provided oil and gas price outlooks together with perspectives on economic recovery and global power investment, and culminated with insights about changes in Latin America and robust drivers for coal and oil demand in China, as well as hints about forthcoming Russian announcements.

These IHS experts painted a comprehensive picture of the global energy and economic landscape: Nariman Behravesh, IHS Global Insight Chief Economist; James Burkhard, IHS CERA Managing Director, Global Oil Group; Shankari Srinivasan, IHS CERA Managing Director, Global Gas Group; Lawrence J. Makovich, IHS CERA Vice President and Senior Advisor, Global Power Group; Gerard McCloskey, IHS CERA Vice President and Global Advisor, Coal; Kefeng Yan, IHS CERA Director, China Energy; Bhushan Bahree, IHS CERA Senior Director, Global Oil Group; Thane Gustafson, IHS CERA Senior Director, Russian and Caspian Energy; Enrique Sira, IHS CERA Director, Latin America Energy.

Dr. Behravesh offered three primary economic risks: potential for asset bubbles in China, sovereign default in Europe, and fiscal problems in the United States that could require legislative actions. Mr. Burkhard suggested that the current $81 per barrel oil price is linked to expectations of future demand since a strong economic recovery is beginning to unfold. Ms. Srinivasan described the triple whammy facing global gas markets: a global economy just emerging from recession, a continued surge in liquefied natural gas capacity, and the unexpected North American shale gale. Dr. Makovich put together the global power landscape projecting a 140,000 megawatts-per-year pace of development with a growing share of renewables, but with fossil fuels remaining a big part.

Mr. McCloskey instructed coal-interested listeners to keep their eyes on China, where in just one year's time an industry equal in size to the US coal sector has been built. Mr. Yan characterized China's government stimulus, which is fueling automobile sales at breakneck speed, as the primary driver for last year's 9 percent oil demand growth, which he projects will continue.

Mr. Bahree on the Middle East said that OPEC's compliance with production cuts is slipping but having little effect. Also in the region we cannot predict Iran's reactions if sanctions are tightened. Dr. Gustafson noted that after the third Russian financial crisis in 30 years, the economic mantras in Moscow of modernization and diversification are challenged by huge capital requirements, dynamic players blocking the value chain, and the potential for complacency with oil at $80 per barrel. Mr. Sira discussed the changing energy matrix in Latin America as more indigenous gas will be used and more of the region begins to manufacture its own refined products.

Mr. Hobbs facilitated a question and answer session that touched on the low probability, yet transformative potential for battery technology breakthroughs. Dr. Behravesh answered a question about what could derail economic recovery by suggesting that oil prices in the $100 to $120 range could be enough to turn positive growth in Europe back into recession.

• David Hobbs, Chief Energy Strategist, IHS CERA (Chair)
• Gerard McCloskey, Chairman, The McCloskey Group
• Bhushan Bahree, Senior Director, IHS CERA
• Nariman Behravesh, Chief Economist, IHS
• James Burkhard, Managing Director, IHS CERA
• Thane Gustafson, Senior Director, IHS CERA
• Lawrence Makovich, Vice President & Senior Advisor, IHS CERA
• Ke Feng Yan, Senior Director, IHS CERA
• Shankari Srinivasan, Managing Director, IHS CERA

4:35 - 6:00 PM

Unconventional Gas Outside North America: The Shale Gale Goes Global

Can the US model be replicated or is it unique?
What are the above ground issues that will impact the ability for the plays in Asia, Latin America, Australia and Europe to gain materiality?
Has a technology plateau been reached?

• Bob Fryklund, Vice President, IHS CERA (Chair)
• John Zumberge, Senior Vice President and Co-Founder, Geomark
• Tom Ahlbrandt, Vice President, Falcon Oil and Gas

Energy Trading and Risk Management: Coping with Volatility and Searching for Transparency

What are the stated (and unstated) goals of proposed energy trading regulations?
Will hedging become more or less expensive if position limits, cash margins, and standardized products are required?
How will the industry react? Will loopholes constitute a fatal flaw?

• Ruchir Kadakia, Director, IHS CERA (Chair)
• Samuel J. Andrus, Director, IHS CERA
• Anthony Cocker, Chief Executive Officer, E.ON Energy Trading SE
• Thomas Leaver, Chief Executive Officer, Dubai Mercantile Exchange
• Andrew Ertel, President and CEO, Evolution Markets

Managing Your "Footprint": New Perspectives On Designing, Building, and Operating in a Carbon-Constrained Future

• James Robb, SVP Enterprise Planning and Strategy, Northeast Utilities
• Bert Turner, Vice President, IHS
• Melanie A. Kenderdine, Executive Director, MIT Energy Initiative
• John Ochsendorf, Associate Professor of Civil and Environmental Engineering and Architecture, MIT
• David Cain, Senior Director, IHS

Driving E&P Operational Excellence: Enhancing Performance through New Technologies and Business Practices

Operational excellence underpins business performance through price cycles and is key to the effective exploitation of remaining oil and gas resources in challenging environments such as mature oil and gas fields, deepwater and frontier areas, and from unconventional plays. This session will examine the fine art of achieving operational excellence and address how technologies, operational practices and organizational models are evolving to drive performance to new levels. How should operational performance and best practices be measured? How can technology and business processes enable operational excellence? What barriers stand in their way? What organizational initiatives are needed to hold and continually improve performance? What does the future hold - what will the next level of operational performance look like and how will it be achieved?

• Paul Markwell, Senior Director, IHS CERA (Chair)
• Andrew Day, Senior Director, IHS CERA
• James Royal, Business Development Manager, Global Industries - Oil and Gas, Cisco Systems, Inc.
• Jeffrey Dickens, Manager, Field of the Future Programme Office, BP Exploration

European Gas Roundtable Discussion

• Shankari Srinivasan, Managing Director, IHS CERA (Chair)
• Robert Fraser, Director, IHS CERA
• Pawel Konzal, Senior Community Manager, Head of Oil and Gas Industries, World Economic Forum

Navigating Uncertainty: From Scenarios to Strategy

IHS CERA Vice President Louis Carranza opened Wednesday's Strategic Session "Navigating Uncertainty: From Scenarios to Strategy" by noting how scenarios can help companies navigate the future business environment and manage their portfolio of assets. In today's uncertain energy industry climate, scenarios have never been more important to CEOs and planners. He discussed the application of scenarios for strategic decisions and noted the need to identify the capabilities that make up a successful scenario team.

James Burkhard, Managing Director IHS CERA, kicked off the discussion by presenting a working definition of scenarios as two or more visions of the world, noting that the role of scenarios is to challenge assumptions about the future and "take you beyond a single-line analysis." Peter Evans, Director, Global Strategy and Planning, GE Energy, said that business unit leaders often want to "cherry pick the future" so that the future looks favorable to the investment decision they want senior leaders to approve. In contrast, scenarios allow you to test decisions against several possible futures. He also noted that creating a global scenario framework is critical because you "need to ground scenarios in macro environment." David Bellman, Managing Director, Strategic and Economic Analysis, American Electric Power Company Inc., added that scenarios force you to challenge yourself. "Completely bizarre events will happen." For example, when forecasting electricity demand, it is important to understand the uncertainty of consumer behavior and the decisions that society will make. Whereas Mr. Burkhard advocated at least two visions of the future, Mr. Bellman creates five scenarios arising from economics, consumer behavior, and climate change policies.

Mr. Carranza noted that scenarios are about stretching your thinking and testing boundaries. Mr. Burkhard pointed out the importance of breathing in ideas from a variety of sources because it is easy to get stuck in thinking that the future will look like the past. The scenario team may initially "stretch its thinking" behind the scenarios but will later pull in the boundaries to get broader corporate buy-in. Mr. Bellman said that he thinks in terms of probabilities and believes it is important to understand the direction and range of your decisions.

The panelists discussed how to sell the scenarios internally. Dr. Evans said that GE has a formal planning process, which enables him to link the scenarios to the planning cycle. He noted that it is also important to understand when leaders will be receptive to the idea of scenarios. Mr. Burkhard noted the importance of leading people through the scenario process in order to get buy-in. He noted the example of oil prices as a well-known assumption that can be turned upside down. Several years ago, conventional wisdom was that $40 oil would destroy the economy, and clearly that was not the case. It is important to encourage people to ask questions. For example, in the new IHS Global Scenarios Initiative, the company solicited critical questions from experts around the world. As a result, three framework questions emerged, which the IHS scenario team will use to create a story for people to respond to, testing the assumptions and creating several visions for the future. Involvement in the process leads to buy-in. It is also important to distinguish between the way the world should be and the world that will be, and is what the scenarios do.

Mr. Carranza asked the panelists how the recent financial crisis has affected their belief in scenarios. Mr. Bellman responded that scenarios allowed him to analyze the impact of three paths for economic recovery on his electric power business. Dr. Evans added that the financial crisis led business leaders to acknowledge that more than one future is possible. "Uncertainty breeds interest in scenarios," he said. In particular, scenarios can help a company respond more quickly to competition when the economic landscape changes. Mr. Bellman commented that because capital is finite, American Electric Power Inc. can stress test potential investments and projects under various scenarios. The assumptions are critical.

Dr. Evans reiterated the value of using scenarios to stress test business ideas, creating a nonconfrontational way to test potential business acquisitions or investments. Rather than hiring outside consultants to serve this function, GE uses its internal scenarios team. Mr. Bellman reported that he uses scenarios to help make build, sustain, and retirement decisions related to the company's power plants.

The panelists disagreed about the capabilities needed to frame and implement the scenario process for strategic decision making but conceded that it is important to have individuals with different backgrounds, expertise, and academic disciplines, including engineers, social scientists, strategic planners, and economists. Mr. Bellman noted that a fundamental characteristic of successful scenario developers is an open mind.

During the question and answer session, the panelists noted the importance of documenting and updating assumptions to ensure that scenarios remain robust.

• Louis Carranza, Vice President, Strategic Development, IHS CERA (Chair)
• David Bellman, Managing Director Strategic & Economic Analysis, American Electric Power Company, Inc.
• James Burkhard, Managing Director, IHS CERA
• Peter Evans, Director, Global Strategy & Planning, GE Energy

7:00 - 9:00 PM

Dinner and Keynote Discussion: The Realignment of US and Global Politics

The Wednesday night dinner opened with a toast from Philippe Joubert, Executive Vice President of Alstom, the Global Energy Partner of CERAWeek 2010. After dinner IHS CERA Chairman Daniel Yergin held a discussion with two renowned journalists and political commentators--David Gergen, a Harvard professor and former advisor to Presidents Nixon, Ford, Reagan, and Clinton; and David Ignatius, a columnist and associate editor for the Washington Post.

Dr. Yergin began the conversation by asking, "What is the tone in Washington?" His guests responded that politics is dysfunctional. There is a sense of pessimism about the future and a disconnect between the political system in Washington and the rest of the country. Mr. Gergen explained, "We're good at responding when the wolf is at the door. We're not good at responding to the termites in the basement." In other words, Americans are good at responding to emergency situations such as the 9/11 attacks or the financial crisis, but very bad at dealing with chronic problems such as education and health care.

Mr. Ignatius agreed, pointing to a long-term decline in the ability of government to solve basic problems. He cited the issue of immigration, about which President George W. Bush cared deeply but was unable to bring the two political parties together to address. The modern media are a big part of the problem. Today's media "tell you that what you think is right. It doesn't challenge your views." He referred to the Internet as an "Anger Accelerator." He observed that the American public wants more and more services from the government but is unwilling to pay for them.

Both speakers give the current Administration high marks for its handling of the Wall Street panic and financial crisis of a year ago, but fault it for not staking out firmer positions on health care, financial restructuring, and climate change. Mr. Gergen believes the Administration is trying to accomplish too much at once and creating too much uncertainty in the process.

The discussion turned to foreign affairs. Both speakers believe that the tide has turned for the better in Iraq, Pakistan, and Afghanistan. They remarked that President Barack Obama's foreign policy team is much stronger than the domestic policy team. Indeed, Mr. Gergen asserted that Defense Secretary Robert Gates is "the best Cabinet secretary of the past 50 years." Both speakers give the military high marks, but Mr. Gergen suggested that "we have a defense policy for the world rather than a foreign policy."

Dr. Yergin next asked how the situation with Iran might unfold in the next year or two. Mr. Ignatius characterized the confrontation with Iran as analogous to "the Cuban Missile Crisis in slow motion" in that we are heading slowly toward a dangerous confrontation. He told the audience that at Secretary Hilary Rodham Clinton's request, the Foreign Minister of Saudi Arabia had recently visited Beijing to tell the Chinese that an Iranian nuclear capability would jeopardize China's energy stability and that Saudi Arabia would guarantee China's oil supplies if China would take a harder line against Iran.

Mr. Gergen brought up the possibility of a "renegade action" by the Israelis, but said that among the US military there is very little appetite for a military conflict with Iran. Mr. Ignatius suggested that ultimately Iran will settle for the Japan model--with all the ingredients for a bomb, but without the bomb itself.

Returning to domestic politics, Dr. Yergin asked who would be the Republican presidential candidate in 2012. Mr. Gergen thinks Mitt Romney could be a serious contender. He believes that the Republicans could have a big success in the midterm elections but that they must develop more policy ideas, and not just oppose Democratic policies, if they are to win elections and govern successfully.

In response to Dr. Yergin's final question as to what could reverse the political dysfunction, Mr. Ignatius said that the American people are looking to Washington for governance. The populist revolt among rank-and-file Republicans conflicts with the need for the Republican Party to say, "We are prepared to govern." Mr. Gergen suggested that American ingenuity and innovation are among our greatest strengths and will be critical in developing needed solutions to many of our problems, including education and health care. He voiced great confidence in the promise of the new generation of returning military officers, the volunteers in Teach for America, and other young people motivated by the desire to serve.

• Daniel Yergin, Chairman, IHS CERA (Chair)
• David Ignatius, Columnist and Associate Editor, Washington Post; Author; Former Executive Editor of the International Herald Tribune
• David Gergen, Senior Political Analyst, CNN; Harvard University Professor; Presidential Advisor

7:30 - 8:45 AM

Leadership Circle Breakfast: Scenarios - Planning Amidst Uncertainty

Sponsored by Alstom

• Roger Goodman, Senior Consultant, IHS CERA (Chair)
• Philippe Joubert, Executive Vice President, Alstom; President, Alstom Power,

Biomass: The "Hot" New Renewable?

Contrasting developments in the US vs. Europe

• Meg McIntosh, Director, IHS CERA (Chair)
• Richard Hamilton, Chief Executive Officer, Ceres, Inc.
• Stephen J. Schaefer, Managing Director, Riverstone Holdings, LLC
• Robert Giglio, Vice President of Strategic Planning, Foster Wheeler Global Power Group

Emerging Power Systems in Asia and the Middle East: Keeping up with Demand Growth and Environmental Constraints

• Mark Hutchinson, Senior Director, IHS CERA (Chair)
• Xizhou Zhou, Associate Director, IHS CERA
• Leila Benali, Director, IHS CERA
• Loic Douillet, Vice President Market Intelligence, Alstom Power

The Future of Geothermal Power: What Role and What Scale?

• Roger Kranenburg, Director, IHS CERA (Chair)
• Yehudit Bronicki, Director, Chief Executive Officer, ORMAT Technologies Inc.
• Jim Slutz, President, Managing Director, Global Energy Strategies LLC
• Alex Klein, Research Director, IHS Emerging Energy Research

Renewable Energy: IHS CERA's New Approach to Competitive Cost Assessment and Positioning

Renewable power is becoming an increasingly important aspect of the power landscape and is expected to capture a significant share of future capital expenditures. As investors in the power sector decide where to place their investment dollars, one key question is: what is the competitive cost positioning of renewable options? Determining appropriate cost estimates is challenging given the numerous and volatile drivers. This session will present our thinking on the competitive cost positioning of renewable power options such as solar photovoltaics (PV), concentrating solar power (CSP) and wind. This will also serve as an introduction to the IHS CERA Green Spread, a new tool to track and benchmark the cost of renewable power options relative to conventional options.

• Sean Biggs, Director, IHS CERA
• Keith Hays, Senior Director, IHS Emerging Energy Research
• Reese Tisdale, Research Director, IHS Emerging Energy Research

The Shale Gale and the Electric Power Industry: What Has Really Changed?

• David Hobbs, Chief Energy Strategist, IHS CERA (Chair)

9:30 - 11:00 AM

North American Power CEO Plenary

In Thursday's North American CEO Power Plenary, Lawrence J. Makovich, IHS CERA Vice President and Senior Advisor, chaired a panel of power company executives on current developments and the outlook for the industry: Theodore F. Craver Jr., Chairman, President, and CEO, Edison International; Peter Darbee, Chairman, CEO, and President, PG&E Corporation; Michael Morris, Chairman, President, and CEO, American Electric Power Company; and David Ratcliffe, Chairman, President, and CEO, Southern Company.

Dr. Makovich started with "the big picture: the economy" and its effect on power demand. Mr. Craver said that Edison International's Southern California retail sales have declined 10 percent since 2008; he foresees stabilization this year and a start to recovery in 2012. Industrial load has declined, replaced by commercial load; residential demand remains about one third of sales. Mr. Ratcliffe said that sales, especially to industrial customers, were down about 6 percent last year, perhaps the bottom. "The temptation is to think that we don't have to plan for the future"; but "given the long-term nature of the industry, we have to keep planning ahead" to provide future capacity. Mr. Morris said that for American Electric Power Company, recent sales declines are starting to turn around. Export demand is increasing, especially to China. He urged industry analysts to recognize that "the message for 2010 is not growth, but recovery."

Dr. Makovich, moving to supply, questioned Mr. Darbee on wind and solar capacity additions. Mr. Darbee noted that distributed generation occurred first in California and first in PG&E Corporation's territory. Solar rooftops have had increasing penetration, whether an opportunity or a threat; Mr. Darbee suggested asking what the customer wants; that's solar, and regulators are open to it. PG&E wants to understand solar's impact and to be on "both sides of the market." Dr. Makovich noted that Governor Arnold Schwartzenegger, favors solar and supports a goal of 33 percent solar in the electricity mix. Mr. Morris considered this overly ambitious: solar already meets 17 percent of California's customer load (compared with 3 to 4 percent nationally); the current transmission system could not handle doubling the amount and tapping remote resources. He noted that California's decades-long promotion of energy efficiency is flattening the demand curve and fostering renewables.

On renewables Dr. Makovich asked Mr. Ratcliffe about prospects for the US Southeast. Although it is difficult to achieve scale for wind, Southern Company is "focusing on biomass and watching solar get better" but can never achieve California's goals, Mr. Ratcliffe said. On federal climate change legislation Mr. Morris said that he liked the Waxman-Markey bill but opposes a utility-only or a cap-and-dividend approach; if nothing is passed by election time, this could be a couple of cycles away. He also stressed that climate change mitigation has to be a global effort. Dr. Makovich noted that in government people with different needs and positions can't seem to function together, but the energy industry has acted differently. Mr. Darbee said energy executives have had constructive discussions for the past five years and reached a "grand compromise" on some solutions, including fair allocation of allowances in cap-and-trade; this might serve as a model for policymakers.

On the industry's goals and outlook, Mr. Ratcliffe stressed customers: make energy affordable, provide cost mitigation for end users, and make realistic timetables based on technological capabilities. Dr. Makovich asked about strategic development, considering both environmental protection and energy security. Mr. Morris said that the "confluence of policy shifts and technology development will change the industry more in the next 10 years than in the past 100 years." California's push on policy, efficiency, and renewables creates momentum in other parts of the country, affecting not just forms of generation--"it will affect the business model itself."

Dr. Makovich brought up coal's long-run viability. Given growing demand, Mr. Ratcliffe said, we don't have the option to choose one or two technologies. "We need everything--efficiency, conservation, natural gas, renewables, nuclear, and coal," with the next generation of clean coal technology as part of the solution. Mr. Morris added that carbon capture and storage is essential. "We can't do without coal," he said; "we need to do it better." He is optimistic about renewables but said coal will be with us for at least the next four decades.

On nuclear, Mr. Darbee noted that California prohibits new nuclear construction until permanent waste disposal facilities are built there but agreed that to meet the climate change challenge, we need all resources, including clean coal and nuclear. Mr. Ratcliffe said the licensing process slows nuclear construction; in Georgia two units are expected to start up in 2016 and 2017. Mr. Morris commented that beyond the financial challenge, enabling state legislation is most needed--and even then nuclear is a daunting decision.

On the smart grid, Mr. Morris suggested there are as many definitions for it as people in the room. He sees it as providing end-to-end delivery of energy, offering more efficiency and greater throughput, and helping meet environmental objectives. Getting standards in place that the energy industry can work with is critical. Work is needed now for final development, not research, and policies should support more pilot programs. On "how to fit the pieces together," Mr. Darbee said customers want to manage their bills and energy use but without reduced service quality and with minimum effort; policymakers and utilities benefit from reduced frequency and duration of outages and better overall management through the smart grid. Mr. Ratcliffe added that the emphasis has been on end use, yet the deployment of "smart" technology at the front end is vital. Mr. Morris said customers must be educated about the technology to manage their energy use. Mr. Darbee called the smart grid "the enabler of the electric car," which emits far less carbon than conventional engines; is a far more effective motor at different speeds; and eases energy security concerns by reducing dependence on foreign oil. Mr. Craver estimated that 100,000 electric or hybrid cars will be driven in Southern California by 2015 and perhaps 450,000 to 500,000 or more by 2020; but "we want to make sure that the customer experience is positive on day one."

The panelists agreed that more transmission is needed; but fixing the patchwork system becomes a "federal versus states' rights issue." Mr. Morris added that a wide-open grid would enable fewer power plants to supply more capacity, and Mr. Darbee called for expediting the transmission permitting process.

On power costs and rising prices, Mr. Morris stressed that "the value of electricity is a multiple of its cost;" Fuel prices may drop; yet the power sector must build new plants and transmission, with the carbon price added. Nor do economies of scale that formerly kept prices down work at these cost levels, Mr. Craver said. Industry must open a dialogue with state financial regulators and with customers about costs and prices. Agreeing on fostering a more transparent dialogue, Mr. Ratcliffe urged a debate on "how to strike a balance between price, reliability, and cleaner energy." Mr. Darbee agreed that "electricity is one of the best buys around; its cost has increased less than the rate of inflation." Mr. Craver said that the pace of industry changes has a huge impact on costs to customers. Getting rid of a useful asset before it has run its course adds a cost to the new technology.

On the outlook for mergers, acquisitions, and consolidation, the panelists differed. Mr. Darbee called these moves advantageous for companies looking to take on large projects, but current regulatory hang-ups discourage activity. Mr. Craver said joint ventures and partnerships more effectively diversify risk.

In conclusion Dr. Makovich asked the panelists what will be the big topic for CERAWeek 2011. Mr. Craver cited the thoughtful integration of innovation in the power system. Mr. Darbee said it would be whether the US energy infrastructure is ready to meet the needs of the future. Mr. Ratcliffe named infrastructure and climate change. Mr. Morris said the discussion would concern disappointment after the International Energy Congress in Mexico City, which might be just another "transfer of wealth."

• Lawrence Makovich, Vice President & Senior Advisor, IHS CERA (Chair)
• David Ratcliffe, Chairman, President, and Chief Executive Officer, Southern Company
• Theodore Craver Jr., Chairman, President, and Chief Executive Officer, Edison International
• Peter Darbee, Chairman, President, and Chief Executive Officer, PG&E Corporation
• Michael Morris, Chairman, President, and Chief Executive Officer, American Electric Power Company, Inc.

1:00 - 2:00 PM

Luncheon and Keynote

At Thursday's CERAWeek Power Day Lunch Daniel Yergin, IHS CERA Chairman, welcomed the audience and introduced the keynote speaker Andrew Liveris, Chairman, President, and CEO, The Dow Chemical Company. Mr. Liveris began with a rare opening for a CEO of a multinational company: "We need government." He explained that there is no substitute for strategic planning to address the long-term challenges currently facing humanity and repeated that "we need government in this arena to help markets function better." Mr. Liveris named three key needs: policies that mandate energy efficiency and conservation, government that helps companies take on risk so that it can be leveraged and taken across the market, and urgent action on climate change. Emphasizing the last point, he told the audience that we need "less talking, more doing" and that "the fact of life is that we have done next to nothing about this, and that is a disgrace."

Mr. Liveris discussed how important institutionalizing energy efficiency has been to Dow since 1990 when the company set a goal to reduce its energy intensity by 25 percent by 2005. It designed metrics, systems, feedback loops, and other internal policies to leverage best practices from within. When Dow successfully met the company goal in 2005, it set another one: to reduce energy intensity by a further 25 percent by 2015. In addition to looking within, Dow also seeks best practices from outside and has found being part of the "Save Energy Now" consortium with the US Department of Energy to be very helpful.

In discussing Dow's commitment to culture of innovation, Mr. Liveris described a new development--a solar shingle that can be installed by any normal roofing contractor and which he believes will become "solar for the masses." On biomaterials Mr. Liveris was less optimistic; in ten years they will likely be a very small part of the market, although Dow is seeking to overcome the hurdles.

Moving on to job creation and the amplifier effect of his industry, Mr. Liveris discussed plans to make investments in other parts of the world as well as to build new plants in the United States and keep jobs here. He emphasized that "the world needs people who can make stuff."

In response to James Mulva, CEO of ConocoPhillips, who called natural gas "the gift" and to Daniel Yergin, IHS CERA Chairman, referring to oil as "the prize," Mr. Liveris said his moniker for natural gas was "a treasure," but clarified that "this [US] shale gas needs to be proven...we need a little more certainty." He was, however, a little more forthcoming toward the end of his remarks: "I'm an optimist--I believe shale gas is a game changer."

Covering a variety of topics in his question and answer period with Dr. Yergin, Mr. Liveris made clear as gas is "a treasure," he is not in favor of putting the fuel "into places it should not be going." One use he cited is transportation for light duty vehicles: "I think the CNG [compressed natural gas] thing is nonsense," and said that CNG compares unfavorably with current fuels, such as diesel.

• Andrew Liveris, Chairman and Chief Executive Officer, The Dow Chemical Company

3:00 - 4:20 PM

Climate Change, the Environment, and Technology: Building a New Future

On Thursday of CERAWeek 2010 IHS CERA Chairman Daniel Yergin chaired a plenary panel on "Climate Change, The Environment, and Technology: Building a New Energy Future." Dr. Yergin and the panelists covered a range of related issues including the changing landscape for energy demand, emerging power generation technologies, and strategic business planning in an uncertain regulatory environment.

Steve Bolze, President and Chief Executive Officer, GE Power and Water, presented an overview of the challenges facing the global electricity market and the technologies required to meet growing demand and emissions targets. Mr. Bolze explained that emerging markets are the centers of demand growth in the global power industry and will grow at approximately twice the rate of power demand in industrialized economies. He pointed out that power producers are expected to develop a power generation mix that can satisfy stakeholder demands for energy independence and low emissions. To conclude his overview of the challenges facing power producers, Mr. Bolze described the water intensity of power generation and explained that 60 percent of the world's population will face water constraints by 2025. In the second section of his presentation, Mr. Bolze walked the audience through the existing and emerging technological options for power generation but tempered the description with comments on the challenges to deploying each of the technologies. In conclusion Mr. Bolze argued that pragmatic and consistent government policies are essential to the efficient development of a global power industry. He singled out the United States as an example of a country that could make significant efficiency gains, adding that only 3 to 4 percent of US electricity is generated from renewable sources.

Minoru Shinohara, Senior Vice President of Technology Development Division at Nissan, described how the company's comprehensive vehicle development strategy has the potential to reduce carbon emissions and reduce transportation congestion. Mr. Shinohara explained that Nissan is pursuing several vehicle development programs simultaneously--enhancing the energy efficiency of existing models, developing state-of-the-art hybrid vehicles, and creating a fleet of fuel cell-powered electric vehicles that produce no carbon emissions. Mr. Shinohara said that Nissan's three-layer development strategy is aimed at improving society by reducing congestion; enhancing driver experience by providing high-quality, low-fuel-cost-vehicles; and protecting the environment by dramatically increasing engine energy efficiency. He reminded the audience that electrification of vehicles provides the flexibility critical to accomplishing overall energy and environmental objectives because many different fuels and technologies can be used to produce electricity.

Moray Dewhurst, Vice Chairman and Chief of Staff of FPL Group, began his remarks by explaining the high level of regulatory uncertainty that complicates power investment decisions in the United States. When introducing him, Dr. Yergin pointed out that Mr. Dewhurst's experience as the leader of a major utility was an essential element in the panel discussion because FPL Group and its peers in the utility sector are charged with integrating the power generation solutions that Mr. Bolze described as well as Mr. Shinohara's vision for the next generation of vehicles. Mr. Dewhurst explained the uncertainty that complicates the power business and stressed that there is tremendous uncertainty about the science of climate change itself. Although many scientists and policymakers are confident about the general temperature trends, major uncertainly remains over the timing, scale, and distribution of environmental change. Uncertainty about the policy response to climate change is also great, Dewhurst commented. The level and intensity of public opinion support for climate change legislation and the technological and political solutions to associated issues such as power transmission are major unknowns, he cautioned. Mr. Dewhurst concluded by explaining the six rules that FPL Group has used to make investment decisions in a complicated power market.

IHS CERA Senior Director Robert LaCount summarized the panelists' remarks and reiterating that power will continue to be at the forefront of the carbon debate for the foreseeable future.

• Steve Bolze, President and CEO of Power and Water, General Electric Company
• Moray Dewhurst, Vice-Chairman and Chief of Staff, FPL Group, Inc.
• Robert LaCount, Senior Director, IHS CERA
• Minoru Shinohara, Senior Vice President, Technology Development Division, Nissan
• Daniel Yergin, Chairman, IHS CERA (Chair)

6:15 - 7:00 PM

General Reception

7:30 - 8:45 AM

Smart Grid Technologies: Moving at High Voltage

• Laurent Demortier, Senior Vice President, Energy Management, Alstom
• Like Wang, Vice President, China Electric Power Research Institute, State Grid Corporation of China
• Larry Cochrane, Senior Technology Strategist, Worldwide Power & Utilities, Microsoft Corporation
• Michael Dulaney, Director, Smart Grid Business Unit, Cisco Systems

The Future of Energy Storage

• Donald Sadoway, John F. Elliot Professor of Materials Chemistry, Massachusetts Institute of Technology
• Thomas G. Granville, President and CEO, Axion Power International and Axion Power Battery Manufacturing
• Frank Novachek, Director, Corporate Planning, Xcel Energy

Power Generation Capital Costs after the Recession: North America vs. Europe

What are the future trends for power generation capital costs?
What is the influence of regional demand drivers by fuel?
How will globalization trends and the economic recovery impact manufacturing and labor supply?

• Roger Kranenburg, Director, IHS CERA (Chair)
• Deborah Mann, Director, IHS CERA

Texas Power Forum

2010 marks a convergence of milestone issues in the ERCOT electric power market: $5B worth of new transmission construction is expected to be permitted; 40,000MW of wind are in the queue for interconnection agreements; smart grid technology is starting to be deployed to accommodate solar and other renewable technologies; natural gas plants are seeing a market as responsive power demand grows; the State's nuclear future could be teetering given the fragile state of prospective new nuclear units. Meanwhile, the Texas Legislature will be scrutinizing in 2010 the ERCOT ISO and the PUCT under a "sunset" process. This panel will be discussing the cauldron of activity brewing in the dynamic Texas electric power market.

• Lawrence Makovich, Vice President & Senior Advisor, IHS CERA (Chair)
• Rebecca A. Klein, Chairman, Power Across Texas
• Jim Marston, President, Environmental Defense for Texas
• Elizabeth Ames Jones, Commissioner, Railroad Commission of Texas
• Kevin Howell, Executive Vice President and Regional President, NRG
• Don Clevenger, Senior Vice President, External Affairs, Oncor Electric Delivery Company

Carbon Capture and Storage in Action: Lessions from the Mountaineer Plant

Sponsored by Alstom

• Ayaka Jones, Associate Director, IHS CERA (Chair)
• Dan Duellman, Director, New Generation & CCS Engineering, American Electric Power Company, Inc.
• Thomas Stringer, Managing Director, CO2 Group, Alstom

10:20 - 10:45 AM

Energy Innovation and Fiscal Stimulus

On Friday of CERAWeek 2010 IHS CERA Chairman Daniel Yergin opened the session "Energy Innovation and the Fiscal Stimulus: A Conversation with Matthew Rogers, Senior Advisor to the Secretary, US Department of Energy" with comments about his guest and the Department of Energy's (DOE) Recovery Act, which was enacted in February. Dr. Yergin called the Act the "largest energy program in the world" and the DOE "the closest thing we have to a Ministry of Science," funding more scientific research than any other organization in the world. The Act has allocated $36.7 billion for new research on energy innovation.

Dr. Yergin asked Secretary Rogers how the stimulus program is working and what it aims to accomplish. Mr. Rogers replied that the Recovery Act focuses on near-term job creation through tax breaks and transfer payments and on laying the foundation for a clean energy future. The Act has unleashed a "river of ideas" from applicants, from which the DOE chooses 20 percent for funding. Competition among these 20 percent produces the most promising innovation.

This program presents an operations challenge, he said. Because it uses public money, the DOE is committed to accountability and transparency in its selection and oversight processes. It seeks top-notch reviewers from major US colleges, universities, and industrial societies to ensure the highest-quality decision-making process. Projects that might seem "crazy" to some are proved viable by the underlying math and could be recognized for their excellent potential by the right reviewer.

The DOE is also committed to reducing the timeline from appropriation to selection--so far from the traditional 24-30 months to 150 days currently--as part of an overall effort to "keep the flow moving" while maintaining very high standards on selection and oversight of projects. The DOE also maintains a closer partnership with industry than previously. "To grow the economy, we have to accelerate the rate of innovation in energy," he said.

In the transportation sector the DOE aims to aid deployment of the best competitive cars possible. The competition between biofuels, natural gas, hydrogen, batteries, and the internal combustion engine can push the transportation industry to a higher performance level and lead to solutions that incorporate a combination of fuels. The Obama Administration, he said, is committed to science as a core value, with the government and private sector playing complementary roles. It emphasizes winning today while laying the foundation for the future.

The DOE now operates at five times its previous pace, he said, and will continue to improve; and managerial tools and presidential oversight have been crucial. He added that all expectations about waste, fraud, and abuse arising from the Act have not come true owing to good oversight. He added that in a decade we will see a set of inflection points that show strong improvements in fuel efficiency, the smart grid, and in technologies that many assumed were static. The key is federal partnerships with companies, laboratories, and academic institutions. He concluded that "the combination of R&D and manufacturing" (innovation and deployment) "is the nexus of long-standing job creation."

• Matthew Rogers, Special Assistant to the Secretary, Department of Energy

12:45 - 2:00 PM

IHS CERA Global Power Outlook and Insights

Philippe Joubert, Executive Vice President of Alstom, Global Energy Partner of CERAWeek 2010, opened the final session of the week by remarking on how encouraged he was to see a strong theme of fuel and technology diversity in this year's conference. He commented, "Finally the idea of a single silver technology bullet is dead."

Jone-Lin Wang, IHS CERA Managing Director, Global Power Group, was joined by other IHS CERA power team experts: Marie Fagan, Senior Director and head of IHS CERA's North American Power Advisory Service; Mark Hutchinson, Senior Director leading Asian and Middle East power research; Fabien Roques, Director of IHS CERA's European Power Advisory Service; Patricia DiOrio, Director and Generation Technology expert; and Xizhou Zhou, Associate specializing in China. Participants offered their views on the key power themes discussed at CERAWeek and their relevance in shaping IHS CERA's global and regional outlooks.

Dr. Wang led by highlighting how, in many ways, "the power sector is the integrator of both the economy and all fuels." Multispeed recovery processes around the world are translating into varied impacts on power demand growth. With regard to this year's unofficial CERAWeek theme of "unconventional gas," the power sector is exhibiting caution rather than enthusiasm, weary of past experiences with fuel price volatility.

As was highlighted in this morning's Carbon Capture and Sequestration Breakfast Panel, neither uncertainty over climate policy nor the economic downturn nor lower gas prices have prevented companies from continuing to invest in technology. To Ms. DiOrio, "Technology is progressing full steam ahead." In the United States a key silver lining of the financial crisis has been the dramatic boost in the funding that energy technologies received and are continuing to receive as part the government's stimulus package.

Next Dr. Wang turned to IHS CERA's regional power experts. According to Mr. Roques, the economic downturn will have "long-lasting effects in Europe," especially on power demand. Over the longer term he sees the center of gravity for new build opportunities shifting to southern and Eastern Europe. Renewables are expected to account for greater than 50 percent of overall new capacity additions throughout the next five to ten years. And while last year's Copenhagen conference was met largely with disappointment in Europe, climate change policies nonetheless continue to play a central role in shaping the power sector.

From Mr. Hutchinson's perspective the Great Recession was "a very different crisis" than Asia's last crisis in the 1990s. For example China is experiencing a very strong economic recovery, and that's boosting industrial demand for electricity, which historically has accounted for 70-80 percent of total demand. In China, Mr. Zhou noted, there is a growing desire to diversify the fuel mix. Hydropower and renewables are being added to the grid at a record pace. And while gas has played little role to date in the power sector, that's expected to change with tighter environmental regulations, a declining load factor, and the need to back up intermittent renewables.

In North America 2009 registered the greatest decline in power demand since the Great Depression. Though power demand in 2010 is expected to grow at a rate of 2.8 percent, it will hardly make up for all the ground lost. Specifically, Dr. Fagan noted that it will take until 2012 before we again reach the electricity consumption levels of 2007. Uncertainty surrounding the shape and timing of US federal climate policy has increased, not decreased, in the past year. Whatever shape the ultimate bill takes, IHS CERA believes that it will have to include something for everyone, including cap-and-trade, renewables mandates, and targeted policies for other clean energy technologies. As for the "shale gale," Dr. Fagan noted that the North American power sector is coming to the party, and if it is a good party, the power sector might even stick around for a while.

• Jone-Lin Wang, Managing Director, IHS CERA (Chair)
• Patricia DiOrio, Director, IHS CERA
• Marie Fagan, Senior Director, IHS CERA
• Mark Hutchinson, Senior Director, IHS CERA
• Fabien Roques, Director, IHS CERA
• Xizhou Zhou, Associate Director, IHS CERA