James McCallum: All energy producers can help one another face an age of change

THE choices we make now in the energy industry will have a significant impact on the next generation and beyond. Climate change is an imminent threat. If we don't act now, we will leave our children to deal with the consequences.

Alternative energy is a real solution and is becoming increasingly important for our economies and societies. A vital catalyst to unlocking a wider, sustainable future energy potential is the oil and gas industry.

Aspirations for renewable and clean energy combined with the challenges facing the oil and gas sector means both must consolidate their expertise for future prosperity. The oil and gas sector still has longevity but its burgeoning renewable energy counterpart also focuses high on the energy agenda.

So what is the motivation for the oil and gas industry to pursue alternative energy?

This is open for debate, but in some cases I believe oil companies have been, and still are, pursuing alternative energy purely for commercial reasons. It is also probably true to say that some see it as a Corporate Social Responsibility (CSR) project; for others, alternative energy has been a public relations exercise with many riding the news agenda focused on "saving the planet".

For me it is much more than that. We strongly believe that the oil and gas sector and the alternative energy sector can work together and coexist to provide a sustainable, balanced energy supply for the future.

If companies have been viewing alternative energy as a CSR project then this is a positive step, as they have been demonstrating concern for issues and priorities outside pure financial return. However, if the driver for companies has been purely for PR then this can be potentially damaging to their reputation.

The oil and gas industry must recognise the fundamental role it has to play in the world's future energy portfolio, working side-by-side with alternative energy.

There are mutual benefits in this joined-up approach, such as sharing skills, infrastructure and technical know-how.

For instance, there are a number of skills that are immediately transferable from the offshore oil and gas industry to the offshore wind sector.

Similarly, there is room for sharing skills and technology between onshore oil and gas and carbon capture and storage, coalbed methane and geothermal energy – areas such as geoscience, reservoir engineering and drilling.

Opportunity also brings potential challenges. There will be competition for the same equipment and people. Increasing oil and gas prices would benefit renewable energy by raising overall energy prices and making renewable energy a more economically viable solution.

However, increased demand for oil and gas also increases the demand for skilled personnel, such as drilling engineers, geophysicists, as well as equipment.

This highlights how the cost for developing resources such as geothermal can increase rapidly when oil and gas prices climb and offset the potential benefit that higher energy prices would bring to the renewables sector.

Our efforts must not be parochial. We have to operate on an international stage – Europe alone cannot effect change on the scale necessary. And, most importantly, we must ensure diversity of energy supply.

These themes need to be at the heart of every business operating in the energy sector.

Europe must be the catalyst for these changes. However, the pace needs to quicken and Europe's leaders must strive to bring the rest of the world with them on the journey that will shape the planet for future generations.

• James McCallum is chief executive of the energy services group Senergy.