Meeting the Emissions Challenge - or NOT?
Greetings!
Oil & gas companies of all sizes – but especially the integrated oil majors - are coming under increasing pressure to confront the emissions challenge.
A quick reminder: emissions attract 3 different labels: Scope 1 are those coming directly from oil & gas operations; Scope 2 arise indirectly in operations e.g. from the electricity generated elsewhere to run operational equipment; Scope 3 are defined as ‘upstream’ e.g the emissions associated with flights to overseas operations, and ‘downstream’, the emissions generated by use of the products i.e oil and gas.
For a typical major integrated oil company, Scope 3 ‘downstream’ will represent 90-95% of the emissions that arise along its complete value chain.
Looking at what the Oil & Gas Climate Initiative group (9 Majors and mini-Majors and 4 NOCs) say, they have in hand an ambitious program to address emissions – focusing on carbon capture and storage; reducing ‘fugitive’ methane emissions and flaring; fuel efficiency (cars first, then trucks); planting trees. You can read some more
here
or
listen
; sounds homogeneous!
However, when analysts dig into what individual OGCI member companies (majors) are doing, there are big variations in quality of reporting, transparency of actions, between Europe and the USA – you can read a lot more about it
here
if you wish. But
this comment
– is a good summary: Equinor’s actions relate only to their Scope 1 and 2, in Norway!
I reproduce the address here in full as I have never seen the words mis-leading and promising in the same sentence before -:
Stepping down in size, and also in any sort of coherent response from companies as a whole, I have been looking at European E&Ps through their websites, Capital Market Days and most recent Annual Reports and I have to say that if they feel a challenge, it is not being met. Scope 1 and 2 reporting is required by regulators but is quite spotty,
Scope 3 ‘downstream’ isn’t mentioned or reported; it is very hard to understand what mitigations are in place or planned; and there seems to be no linkage between executives’ performance contracts and emissions mitigation. There is, however, a limited amount of ‘virtue signalling’ about gas and its crucial role in the Energy Transition!
As we come to the AGM ‘season’, my guess is that we will see a couple of companies really taken to task on this issue, a hanging or two ‘pour encourager les autres’ if you will.
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The report from our December 6 "Responsible Investing in Oil and Gas" is available for download
here
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The big challenge - which the event addressed - was whether it is possible to connect the trillions of dollars of investment funds earmarked for "Environmental, Social, Governance" (ESG) with E&P companies with a performance much higher than the minimum on ESG issues.
It is a fascinating question, worthy of much consideration, and the answer is not clear. It may be obstructed by a belief that ESG investments should offer better returns on normal investments once ESG issues are fully considered, and a belief that the oil and gas industry can never be environmental.
- Can we define responsible investing?
- McKinsey - how oil and gas operators are responding
- OGCI - providing oil industry leadership on climate
- Chris Wheaton - an investor’s perspective on E&P ESG
- ESG issues with operations in Africa
- CCS from an investor perspective
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Upcoming events
Maintain production and explore new technology
London, 23 Mar 2020
London, 27 Apr 2020
£50
Advances in seismic technolgy that enable us to become entirely predictive about fractures!
London, 05 May 2020
Free
The hotspots across Southern Africa - offshore South Africa, Mocambique, Namibia and Angola
Special event at South Africa High Commission in Trafalgar Square
Where are the opportunities for investors and E&Ps in the Middle East?
London, 11 Jun 2020
Greece, Italy, Cyprus, Lebanon, Turkey?
London, 25 Sep 2020
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COMMENT
Is it time we took more of a project management approach to digital technology projects for our organisations?
REPORTS FROM OFFSHORE EUROPE IN ABERDEEN
- BP, Cognite and Equinor on how to move forward with digitalisation
- The carbon and digital energy transition
- Total’s CEO Patrick Pouyanné on carbon
- How EY and DNV GL see the future of energy
- Benefits from digital transformation “thin on the ground”
OPERATIONS DIGITAL TECHNOLOGY
- Schneider Electric - Integrating power and process systems
- ABB – reduce offshore fuel consumption and improve operations
- OT cyber security needs more attention in many companies - ABB
- Claroty – how the OT threat landscape is changing
- Emerson – how automation can help improve operations
- Fieldbit – platform for field service visualisation
- Closer supplier relationships to reduce subsea development costs - Baker Hughes GE
- Eigen – integrating drilling and equipment data
- Restrata – using data to track offshore people
- Visavi – helping AkerBP with operational planning
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Are you interested in speaking / sponsoring one of our 2020 events?
We have events planned on NW Europe, new geophysical approaches, Sub Saharan Africa, Middle East, Eastern Mediterranean, digitalising exploration, and carbon capture and storage / ESG.
See our 2020 event calendar
here
Download our 2020 marketing guide for delegates and marketers
here
Contact Karl Jeffery, event producer, on +44 208 150 5292,
jeffery@d-e-j.com, to discuss sponsorship options
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PETROMALL INSIGHTS
FINDING PETROLEUM EVENT REPORTS
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