New Energy World™
New Energy World™ embraces the whole energy industry as it connects and converges to address the decarbonisation challenge. It covers progress being made across the industry, from the dynamics under way to reduce emissions in oil and gas, through improvements to the efficiency of energy conversion and use, to cutting-edge initiatives in renewable and low-carbon technologies.
Decarbonising oil and gas operations is a must if the world is to maintain its steady course towards net zero carbon emissions, writes Nnamdi Anyadike.
The International Energy Agency (IEA’s) World Energy Outlook estimates that, based on Scope 1 (direct emissions) and Scope 2 (purchased energy), oil and gas operations today account for around 15% of total energy-related emissions globally. This is the equivalent of 5.1bn tonnes of greenhouse gas (GHG) emissions. Essentially there are only two ways in which the oil and gas industry can meaningfully cut its GHG emissions: reduce fossil fuel production; and reduce emissions at the source of production. Doing both alongside reductions in oil and gas consumption, would, according to the Agency’s Net Zero Emissions by 2050 Scenario, result in a 60% reduction in emissions from oil and gas operations to 2030.
Achieving these targets, however, is fraught with difficulty, particularly because that relies on oil and gas companies setting, and then adhering to, emissions targets. As Imperial College London’s Professor Jim Skea, Chair of the Intergovernmental Panel on Climate Change (IPCC) and a former Energy Institute (EI) President, remarked at International Energy Week in February 2024: ‘Without the energy sector, we cannot have successful action on climate change. A carbon budget will allow us to know how much cumulative CO2 is put into the atmosphere. But the emissions from the oil and gas sector from the current infrastructure, if conventionally run, would more than exhaust the carbon budget for a 1.5°C increase in global temperature above the pre-industrial average.’
Yet despite the urgency there are clear signs that some players in the oil and gas sector are not only dragging heels but in some cases rowing back from earlier production commitments. Oil major BP stands accused of muddling its targets, on the one hand by pledging in 2020 to cut emissions by 40% by 2030, but then only last year announcing a reversal. In February 2023, the company promised shareholders it would invest heavily into oil and gas projects and ‘recalibrate’ its oil and gas reduction goal from 40% to 25% by the end of the decade. According to the Financial Times, this decision ‘will increase investment in the production of fossil fuels for the rest of the decade by about $1bn per year, beyond previous plans’.