Energy policy should be the concern of all - Blaskovich

Mr Frank Blaskovich, the Vice President of Blaskovich Services in Northern California, US, has noted that energy policy has a serious impact on everyone in the society.

He, therefore, called on stakeholders whoever cared about the society, the energy business, energy jobs or his or own job to be focused on the policy.

Mr Blaskovich made the observation when he spoke on: “Energy Policy- Is it Effective? Is it Fair in Accra, as a SPE “Distinguished Lecturer” in Accra.

Mr Blaskovich focused on energy policy and its importance to stakeholders including energy producers, governments and societies as a system problem.

His primary spotlight was on measuring policy effectiveness and fairness.

The Lecturer said a policy model had a number of drivers that could affect system behaviour.

“Even though policy models and physical models are different in many ways, analysis techniques are similar.

“However, because of deep uncertainties about the future, we use regret analysis to develop policies that minimise losses when bad behaviour occurs.

“We test our policies by re-running the model with resulting policies to see how well they perform. Modifications can be made until policies work better than previous policies. This is a never-ending process because uncertainty about the future will always be with us,” he said.

Mr Blaskovich said: “Our goal is to find policy choices that tend to minimise regret over a wide range of possible, but unknowable futures. This shows typical results from a Regret Analysis and the boundaries of the Policy Envelope created from model runs.

“Every combination of policy drivers and objectives represents a possible future. For each future, a specific policy generates the best objective result – Minimum State Regret for the State and Minimum Producer Regret for the Producer.

He said there was much more variability in the Fair case production taxes than in the other policies.

“A logical question is whether or not the Fair policy is correct? This is a non-intuitive result that often can occur in complex systems. No one, other than a system ‘savant’, could guess the Fair policy without running the model. Complex model results always need constant scrutiny.”

He said it was impossible for one to choose the best policy in a complex system problem the only alternative was to try the best ones.

Mr Blaskovich said policy making was a never-ending process of development, testing and refinement to meet the needs of all of the actors, who were ultimately all members of the society.

He described the energy policy problem as a wicked, complex system problem that affected all every day and could only be managed using a system model approach.

“We can only hope for the best, but always plan for the worst,” he said. Mr Blaskovich asked stakeholders to think more carefully about how energy policy was determined while it was very important and difficult to develop effective and fair policies.

“The more people understand this, the better our chances of getting policies that will benefit all of us.

“I have always thought that the best way to understand a problem is to look at it from another person’s perspective.

“What policy would you recommend if you are an Energy Producer? If you are a Society member? If you were a State Policy Maker? I suspect that the choice is not the same depending on your perspective. This reinforces the idea that policy making is difficult,” he said.

The programme was organised by the Society of Petroleum Engineers (SPE), Ghana Section, and funded by the SPE Foundation through member donations and a contribution from Offshore Europe.

The SPE is the largest individual-member organisation serving managers, engineers, scientists and other professionals worldwide in the upstream segment of the oil and gas industry.

There are two types of membership: Professional and Student.

Membership is not restricted to Petroleum Engineers. Other professionals, regardless of experience or course of study, including other engineering professions, lawyers, journalists and accountants.

Student membership has its own benefits and include: Opportunity to apply for SPE scholarships; Discounts on textbooks and reference books; Compete in paper contests; Receive career advice from a mentor; Participate in SPE programmes like eMentor and Petrobowl; access to technical papers on onepetro etc.

Each year, SPE selects a group of professionals, nominated by their peers, to share their knowledge and expertise with SPE members through visits to local sections.

Distinguished Lecturers are nominated by their peers, and selected by the SPE's Distinguished Lecturer Committee for quality, timeliness and relevance of presentations. The committee solicits nominations from each region of the world to cover all disciplines.

The SPE Ghana Section was established on 19, September 19, 2010 and given approval by the SPE International Board during the Annual Technical Conference held in Florence on September 20 – September 22, 2010.