Thank you, Mr. Villegas.  I appreciate the opportunity to be here with all of you today and join the distinguished list of speakers on your agenda.  I have only been in your country for a short time, but it is long enough to recognize that there are ample opportunities for enhanced cooperation between the United States and Colombia in all areas – but especially on energy.

The U.S. has long stood as a proud ally of your country—from the early days of Colombia’s independence, which President Bush and other U.S. and Colombian officials commemorated at the White House in Washington just a few weeks ago.

And over the past decade, the U.S. has strongly supported Colombia’s ambitious efforts to secure your economic and democratic development.

President Uribe’s hard decisions during an often-times difficult period have been rewarded with success.  We applaud your many accomplishments, and in particular, your President’s strong commitment to winning the fight against domestic terrorism, protecting human rights, advancing democracy and promoting economic opportunity.

And we know that the strong partnership between our two countries will continue well into the future.  That is why President Bush and President Uribe have together negotiated the United States-Colombia Trade Promotion Agreement.  This agreement is important for both countries because it promotes sustained economic growth—and vital national security—which after all, really go hand in hand.  I want you to know that the President and all of us in his Administration continue to urge the U.S. Congress to act on this agreement as soon as possible.

The significance of the agreement, I’m sure, is not lost on this audience.  ANDI is one of the key institutions supporting free enterprise in this region.  As I understand it, a fundamental tenet of your mission is to encourage the participation of Colombia’s public and private sectors in the international community.  In our ever-expanding world, this is a critical role.

And nowhere more so than in the energy sector.  Improving the world’s energy security is a global problem that requires global solutions—and one that carries significant consequences for our economic health, our security, and our environmental sustainability.

We face a daunting set of challenges.  Since 2003, global energy demand has increased significantly.  World oil consumption growth has averaged 1.8 percent per year, with the largest share of that increase coming from non-OECD countries, especially China, India, and those in the Middle East.

This increase in global energy demand, coupled with little to no growth in supply, has led to high energy prices that are threatening economic growth and development around the world.

Addressing this challenge in a timely way will require literally billions of dollars annually over many years.  The International Energy Agency estimates that $22 trillion of investment will be needed between now and 2030 to meet expected demand.  And we know that this investment must occur around the world at all stages of the energy cycle.

At the same time, we all must recognize the realities of global climate change and look for ways to develop clean sources of energy that at the very least do not worsen—and can hopefully improve—the health of our earth’s environment.

Meeting these challenges will require responsible and sustained action by all nations—actions to expand the energy alternatives available to the world and to move to sources and methods of production and delivery that are more efficient, cleaner, and secure.   Doing so successfully will continue to require intensive cooperation among nations—a truly global strategy.

For conventional fuels, the principal challenges facing us include: making the necessary, massive investments to bring sufficient hydrocarbons to market—promoting investment climates around the world that are conducive to inviting such capital flows—and adequately investing in ways to produce fossil energy more cleanly and efficiently.

I would also add that as we consider ways to develop a more stable and diverse global energy supply, we must look beyond conventional oil and gas—and consider how to accelerate the development of nontraditional fossil fuels—like oil shale and oil sands—and also to grow and maintain an adequate liquefied natural gas (LNG) infrastructure globally.

But, while the world will remain dependent on hydrocarbons for years to come, we also know that we absolutely require new energy options in the form of alternative fuels and clean energy technologies—such as next-generation biofuels; advanced vehicle technologies; hydrogen fuel cells; solar energy; high-efficiency wind power; and clean-coal technologies.

And, on this last point, there is a real opportunity for U.S.-Colombian collaboration.  The United States has offered to host a visit of Colombian scientists to the Department of Energy’s National Energy Technologies Laboratory (NETL) for discussions on carbon capture and storage.  These technologies would be beneficial to Colombia’s refining and extractive industries—carbon capture provides a way to reduce CO2 emissions, but also provides a source for carbon injection into declining oil fields for enhanced oil recovery.

I also believe that improvements in energy efficiency can be achieved—in relatively short order—on a global scale in our industrial and power-generating sectors, our government agencies, our homes, our offices, and our transportation sector.  Collectively, these measures will not only take some pressure off of global demand, but also improve the health of our shared environment.

Of course none of this is news to you—or to the leaders of Colombia’s government, who recognize that diversifying this nation’s energy resources will benefit its economy for the long term and will be critical to sustaining its development.

In particular, your forward-leaning approach to the development and promotion of biofuels is to be commended.  We would encourage you to continue to aggressively pursue these alternative energy sources and enhanced efficiency measures.   The U.S. certainly stands ready to assist in whatever way possible as our governments—together–as partners—pursue these vital goals.

In all these areas—from conventional hydrocarbon development to alternative energy to improved efficiency—the underlying factor that will ultimately determine our success is our ability to come together and achieve massive and sustained investment in energy production and delivery.  After all, the record high oil prices we’re experiencing are not just indicative of rapidly increasing demand--although that’s certainly a major factor—but also of the lack of adequate investment in new supply over many years.

And in order to ensure the scale of investment we need for reliable and secure global energy production into the future–on this, I don’t think anyone here will argue with me—open market principles are essential.

Colombia certainly has an important regional leadership role to play in this regard.  Your country has made great strides to limit investment barriers and provide a welcoming climate to foreign direct investment.  And this provides a model to your neighbors in the region.  It’s not only the market-based policies you have implemented—like the successful sliding-scale royalty rate on oil projects.  It’s also the initiatives your government has undertaken to enhance security and thereby increase the attractiveness of foreign investment.

The numbers bear this out.  In 2007, new foreign direct investment totaled $9 billion.  And forty percent of that investment was directed to the oil industry.

In fact, U.S. companies have invested approximately $2 billion in the Colombian energy sector.  These companies have shown that they can provide cutting edge management, technology and capital to Colombia’s energy development projects.  The success of these partnerships is one of the reasons that the United States’ commercial ties with Colombia have been strong and growing substantially.

I’m confident that this relationship will prove durable and long-standing, and that Colombia will continue to expand its role as a reliable, market-based energy producer.  The United States certainly relies on our Colombian ally as a key supplier of oil, natural gas and coal.  And others in the region do as well.

Sustaining this partnership will require continued vigilance and strong commitments on the part of both our nations—and we will continue to need policy and regulatory environments that not only support—but actively encourage—the level of investment, and sustained collaborations with academia and the private sector that we need.

In the United States, we are attempting to do this in a number of ways.  Under President Bush’s leadership, we are aggressively funding programs—for both basic science and applied R&D—to hasten the type of transformational discoveries that truly change the nature of our thinking and fundamentally alter how we produce, deliver and use energy.

At the same time, we’re actively pursing new approaches to getting beneficial technologies out into the marketplace quickly by employing a range of collaborative models, including cost-sharing partnerships and loan guarantees, as well as establishing innovative programs to bring venture capital-sponsored entrepreneurs into our National Laboratories to help commercialize new technologies.

What we’re trying to do is look at this challenge in a new way –to try to incentivize the collaboration that is necessary between government and the private sector.

This is because we recognize that the key to unlocking our energy future is ensuring that the innovation cycle continues at a rapid pace across the spectrum—in our government laboratories, at our universities, and especially in the private sector.

The bottom line, really, is this: we need more investment to achieve the diversity of supply—and suppliers—that we must have to bring about a cleaner, more affordable and sustainable global energy future.  To do that, we must: increase government financing of R&D around the world; enhance international cooperation; eliminate regulatory barriers; modernize and protect our energy infrastructure; and provide an open, transparent global business environment that encourages sustained investment in all forms of energy and efficiency technologies.

This is a tall order, but as we forge ahead together, the stakes for a continued—and strengthened –relationship between the United States and Colombia could not be higher.  I am here today to highlight our continued commitment to the government and to the people of Colombia.  We applaud your many successes, we thank you for your friendship over the past two centuries, and we look forward to standing together to face the challenges of this new era.

Thank you very much.

Media contact(s):
Bethany Shively, (202) 586-4940