Editor's Note:

Each fall the National Council on US-Arab Relations brings together a distinguished group of diplomats, government officials, business people, military officials, scholars and others to tackle the thorny issues surrounding US-Arab relations. SUSRIS has provided AUSPC speakers' remarks, which touch on the Saudi-US relationship, to you for over the last five years. In keeping with that practice we again provide for your consideration a collection of AUSPC presentations.�

Today we present the remarks of Mr. Jay Pryor, Vice President for Corporate Business Development, Chevron Corporation. Mr. Pryor addressed the challenge of long-term energy security and reflected on partnerships with Saudi Arabia to provide energy supplies to the world. He was joined on the panel by Karen Harbert, the Chair, of the U.S. Chamber of Commerce's Institute for 21st Century Energy, Ryan M. Lance of ConocoPhillips, Nabilah Al-Tunisi of Saudi-Aramco and Jim Burkhard of Cambridge Energy Research Associates. Their remarks will be provided separately and are posted on the SUSRIS web site (links below).

Additional AUSPC sessions which address U.S. and Saudi issues will be provided by SUSRIS in the coming days. For more transcripts online check the index and link below.

17th ANNUAL ARAB-U.S. POLICYMAKERS CONFERENCE
"Transitioning the White House: Challenges and Opportunities for Arab-U.S. Relations"
October 30-31, 2008 | Washington, DC

Energy: The Long View
Jay Pryor

[MS KAREN HARBERT] Jay Pryor is last but not least certainly and is with the Chevron Corporation as their Vice President for Corporate Business Development which as his title implies he�s responsible for finding, identifying, and developing the new large scale business opportunities for Chevron. He has been with Chevron his entire career, holding a succession of management positions with increasing responsibilities in Asia, the United States, Europe and the former Soviet Union. In 1992, he then joined one of their overseas subsidiaries which was Tengizchevroil in Kazakhstan.. ..Then he moved on to South Asia and finally on to Nigeria where he had a portfolio that encompassed all of Africa. He is also the co-chair of the Nigerian Business Coalition Against HIV-Aids. So take it away.

[MR. JAY R. PRYOR] Thank you very much to the Council, especially you Karen and John for inviting me to join this very distinguished panel. After next week�s elections and as plans are made for the new President and Congress in January it�s very important to take the longer view of what�s in our nation�s best interests and the partnerships that will support these interests. The conference is especially well placed to examine the long view. Both for the Middle East and with respect to this panel, energy security. The world is focused on the financial crisis presently, but energy security remains a major long-term challenge that must be addressed by all of us. Just as the financial crisis requires a global response so does the need for long term reliable supplies of energy.  My message today is this. The Middle East has been a reliable, steadfast supplier of energy to the world for many years. And the U.S. must strive tirelessly to build and strengthen its long-term partnerships with this region. The foundation for our long-term partnerships with the Middle East is already firmly in place. My company, Chevron, for example has a 75-year partnership with the region. One of our panelists gave the very beginning, 1933, the seventh well drilled in a string of wells struck oil in Saudi Arabia. Our operations span the petroleum value chain in the Middle East from exploration and production, of course, through the value chain to petrochemicals as was mentioned, through to marketing and refining.

The range of activities over the 75 years has taught us the importance of long term partnership and today that partnership is more important than ever. Why is this the case? To answer the question let�s take a step back and look at the global energy picture. Even with the increasing efforts on efficiency and alternative fuels which my company strongly supports, projections of the world's increased fossil fuel production by 50 percent by the year 2030. Let�s put this in perspective. Fifty percent more than today�s world which uses 125,000 gallons per second. That�s the only way we can meet this challenge through strong partnerships in investment, technology and people. 

The importance of the Middle East to the global energy supply cannot and must not be understated. The Middle East supplies over half the world�s oil and gas needs. They should be acknowledged for this important role. The role it plays as a reliable, steadfast part of the global energy supply chain. Middle Eastern countries such as Saudi Arabia in oil, and Qatar in gas have been and remain strong partners and responsible suppliers. 

Saudi Arabia�s production recently exceeded 9.7 million barrels per day. They are currently spending tens of billions of dollars to increase production to 12 million barrels and of course beyond that. King Abdullah reinforced the strong production record when he convened, with great leadership, an energy summit last June in Riyadh attended by leading consuming and producing countries and companies. David Riley, my chairman, attended that summit. Of course since then the oil and gas prices have lessened considerably, potentially moderating the financial crisis, but those sharp drops in prices have prompted a lot of discussion around reducing production levels. 

Let me say a few words about Saudi, a country which is special to Chevron and provides a great example of partnership in investment, technology and people. Chevron was the first to ship oil from the Kingdom in the 30s. We recently renewed our 60-year concession in the partition neutral zone between Kuwait and Saudi Arabia for 30 more years. We will be operating on behalf of the Kingdom bringing the most advanced technology to developing the resources and our workforce there, which is currently over 90 percent Saudi. 

We�re making solid progress in a series of projects to validate the feasibility of utilizing steam floods to produce heavy oil of the eocene carbonate reservoirs. If successful this will mark the first time the enhanced oil recovery technology has been employed to produce commercial quantities from the carbonate reservoirs anywhere in the world. 

As an important part of the operations in the partition neutral zone Chevron will continue to transfer technology and apply its expertise in project management, reservoir management, health, safety, environment, and of course drilling and other technologies. 

In gas, Qatar has been an outstanding partner, welcoming foreign investment and ensuring continuing supplies throughout the world. Qatar currently exports 745,000 barrels of oil a day and 18.2 billion cubic meters of natural gas per day. Our experts in the industry estimate that Qatar by 2010 will export 30 percent of the world�s LNG, liquefied natural gas. Chevron also partners both in Qatar and in Saudi Arabia in the petrochemicals business. 

Another, the UAE is a very vibrant financial and tourism sector. It�s also a very important player in energy. The Arab Petroleum Investment Corporation forecasted over the next five years $395 billion will be spent in the Middle East on projects like oil, gas and electricity. We can look then to many other energy partners in the region. From Algeria, with its natural gas capacity, to Libya, opening up its petroleum sector recently, to Iraq, with renewed help in its oil sector which we contributed to through training and support and hopefully in time through some long-term projects. 

Longer-term partnerships will also extend the dimensions of energy efficiency and expand different sources and types of energy. Deeper trade ties will also align our interests and expand economic growth and energy security. There�s a real opportunity for intra-regional cooperation in energy as highlighted by the Dolphin project and proposals for regional electricity grids. Responsible leadership in today�s world requires that we identify and work closely with reliable partners. The coordinated global response to the financial crisis provides a partnership model for achieving global energy security. The strong long-term partnerships between the U.S. and the Middle East will help secure the economic growth and energy security for the generations that follow us. 

Chevron believes the long-term strategic foreign and energy policy toward the Middle East is essential. This is policy that recognizes and strengthens partnerships with countries in the region. And a policy that makes common cause not only on energy but in our initiatives for the wider region and the world.

Thank you.
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Source: Arab-US Policymakers Conference Web Site (AUSPC 2008)
http://www.auspc.org 

Transcription Services by Ryan & Associates

About Jay R. Pryor

Mr. Pryor is Chevron Corporation Vice President for Corporate Business Development. He assumed his current position in May 2006. He is responsible for identifying and developing new, large-scale business opportunities throughout the world.

A native of Mississippi, Mr. Pryor earned his Bachelor's Degree in petroleum engineering from Mississippi State University in 1979. That same year, he joined Chevron U.S.A. Production Co. as a petroleum engineer and held numerous production-related positions. He gained valuable downstream management experience in U.S. natural gas sales during the country's transition toward deregulation.

Mr. Pryor held a succession of management positions with increasing responsibilities in Asia, the United States, Europe and the former Soviet Union. In 1992, he joined Chevron's international subsidiary Chevron Overseas Petroleum Inc. as the first manager of petroleum engineering in the newly established Tengizchevroil joint venture in Kazakhstan. In 1996, he transferred to San Ramon, Calif., as sponsor in charge of career development for operations personnel. He also served as general manager of Human Resources for Chevron's worldwide operations.

In 1999, Mr. Pryor became managing director of the Asia South business unit and managing director of Chevron Offshore (Thailand) Ltd. In 2002, he was named managing director of Chevron Nigeria Ltd., one of Nigeria's leading petroleum exploration and production companies. In that position, he was responsible for directing Chevron's oil and gas operations in West Africa, including Nigeria, S�o Tom�, Chad and in Equatorial Guinea.

Mr. Pryor also is co-chairman of the Nigerian Business Coalition Against HIV/AIDS, a body inaugurated by Nigeria's President Olusegun Obasanjo to spearhead efforts by the country's private sector to combat the spread of the deadly disease. In addition, he is a member of the Society of Petroleum Engineers and founded the society's first branch in Kazakhstan.

For more information: www.chevron.com 

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