A number of challenges exist as policymakers push for a transition to new energy systems, say the leaders of three of the world’s largest oil and gas companies.

The three executives — Amin Nasser, president and chief executive officer of Saudi Aramco; Hou Qijun, director and president of China National Petroleum Corporation; and Darren Woods, chair and CEO of Exxon Mobil Corporation — spoke at a plenary session on Monday at the 24th World Petroleum Congress in Calgary.

Nasser said the biggest challenge for the transition is building renewables and new energy capacity while at the same time decarbonizing existing resources.

“You cannot achieve your transition unless you make sure you have adequate supply of low-carbon conventional energy,” he said, adding that will help achieve the goal of transitioning over the longer term.

“If we don’t have adequate supply over the mid- to long-term, prices will go up, [there will be] more shifting to coal, and you’ll end up with a world with more emissions,” Nasser said.

Solutions must take into consideration the affordability and security of existing supply, he added, or some countries — based on their economic maturity — may use more carbon-intensive forms of energy.

“Unless we find a solution that is global, there is no barrier when it comes to emissions. If on one side you’re building all new renewable plants and on the other side someone is building more coal plants, the world is not getting better — we will have more emissions.”

CNPC’s Hou also touched on the need to have stable hydrocarbon supply to ensure energy security.

As an example, he cited the need to make investments to maintain a stable level of natural gas output, and even to have some production growth, as it relates to consumption by Chinese households.

A second challenge involves the amounts of required funding for the transition.

“We are investing substantially currently, and in the future new energies also require substantial investment,” Hou said.

A third challenge, he noted, is China’s plans to increase the electrification rate for end-use consumption to about 80 per cent.

On that score, a major technological challenge will involve the country’s refineries, where China would like to use “electricity-based cracking furnaces” for refining and petrochemical production.

If the country cannot meet its 80 per cent electrification threshold, though, Hou said China will “need to scale-up CCUS to achieve carbon neutrality and that also brings the issue of reducing the cost of CCS and improving the technologies concerned.”

Like Hou, ExxonMobil’s Woods said there will be large capital requirements to advance new technologies.

“I … think it’s important to recognize that we’re starting up brand new industries here that don’t exist today,” he said.

New supply chains and value chains will need to be constructed for capturing CO2, transporting it, and then providing permanent storage.

Woods said “putting that together in an environment today where you don’t have policy and regulations that recognize those value chains, is, I think, a really big challenge.”

Moreover, he said the U.S. regulatory environment is designed, today, “to stop building things, rather than start building things.

“This is going to require large-scale, new-build logistic systems and facilities which I think is going to be a real challenge in this space.”