RIYADH?Global appetite for oil and gas will continue to grow despite intensifying efforts to curb climate change, even as renewable energy plays an increasing role in the energy mix, Saudi Arabia's powerful energy minister Khalid Al-Falih said.
Commitments undertaken as part of the COP21 accord reached in Paris last year will "turn debate into action" and lead to greater efforts world-wide to limit climate change, said Mr. Falih, who is also the chairman of Saudi Arabian Oil Co., known as Saudi Aramco. Even fast-growing energy consumers such as India and China "will play a vital role in meeting global climate change targets," he told an energy conference in Riyadh.
But without technological breakthroughs, renewable energy will not displace more cost-effective fossil fuels, he said. "We see a long future ahead in which" fossil fuels "will be part of the energy mix, with the contribution of renewables growing."
That means "the notion of stranded resources is therefore ill-advised and misleading to markets," he said.
This year, the kingdom unveiled a plan to transform its oil-dependent economy by diversifying into other sectors, with moves that include the privatization of some assets and the public listing of a small minority of Aramco.
Mr. Falih called the diversification plan a "holistic approach to problem-solving," in his speech at the conference, hosted by KAPSARC, a Saudi energy research center.
Mr. Falih said the early stages of Saudi development depended heavily on oil but they were also marked by inefficient consumption. Mr. Falih said the kingdom isn't reducing the "contributions of oil and gas" but rather increasing the contributions of other sectors to minimize the volatile effects of the commodity cycle and accelerate the growth of the Saudi economy.
The development of more sectors is necessary to ensure there are enough jobs for young Saudis, he said. He referred to a $100 billion technology investment fund launched with Japan's SoftBank as "one indication of this determination and the steps we intend to take."
Write to Elena Cherney at email@example.com and Ahmed Al Omran at Ahmed.AlOmran@wsj.com
(END) Dow Jones Newswires
November 01, 2016 06:55 ET (10:55 GMT)
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