The oil and gas sector must reduce their planet-warming operations

The oil and gas sector must reduce their planet-warming operations

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In the recently published IEA article on a special report, it is put simply that to save the climate, the oil and gas sector must reduce their planet-warming operations. 

 

 

 

 

Oil and gas producers face pivotal choices about their role in the global energy system amid a worsening climate crisis fuelled in large part by their core products, according to a major new special report from the IEA that shows how the industry can take a more responsible approach and contribute positively to the new energy economy.

The Oil and Gas Industry in Net Zero Transitions analyses the implications and opportunities for the industry that would arise from stronger international efforts to reach energy and climate targets. Released ahead of the COP28 climate summit in Dubai, the special report sets out what the global oil and gas sector would need to do to align its operations with the goals of the Paris Agreement.

Even under today’s policy settings, global demand for both oil and gas is set to peak by 2030, according to the latest IEA projections. Stronger action to tackle climate change would mean clear declines in demand for both fuels. If governments deliver in full on their national energy and climate pledges, demand would fall 45% below today’s level by 2050. In a pathway to reaching net zero emissions by mid-century, which is necessary to keep the goal of limiting global warming to 1.5 °C within reach, oil and gas use would decline by more than 75% by 2050.

Yet the oil and gas sector – which provides more than half of global energy supply and employs nearly 12 million workers worldwide – has been a marginal force at best in transitioning to a clean energy system, according to the report. Oil and gas companies currently account for just 1% of clean energy investment globally – and 60% of that comes from just four companies.

“The oil and gas industry is facing a moment of truth at COP28 in Dubai. With the world suffering the impacts of a worsening climate crisis, continuing with business as usual is neither socially nor environmentally responsible,” said IEA Executive Director Fatih Birol. “Oil and gas producers around the world need to make profound decisions about their future place in the global energy sector. The industry needs to commit to genuinely helping the world meet its energy needs and climate goals – which means letting go of the illusion that implausibly large amounts of carbon capture are the solution. This special report shows a fair and feasible way forward in which oil and gas companies take a real stake in the clean energy economy while helping the world avoid the most severe impacts of climate change.”

The global oil and gas industry encompasses a large and diverse range of players – from small, specialised operators to huge national oil companies. Attention often focuses on the role of the private sector majors, but they own less than 13% of global oil and gas production and reserves.

Every company’s transition strategy can and should include a plan to reduce emissions from its own operations, according to the report. The production, transport and processing of oil and gas results in nearly 15% of global energy-related greenhouse emissions – equal to all energy-related greenhouse gas emissions from the United States. As things stand, companies with targets to reduce their own emissions account for less than half of global oil and gas output.

To align with a 1.5 °C scenario, the industry’s own emissions need to decline by 60% by 2030. The emissions intensity of oil and gas producers with the highest emissions is currently five-to-ten times above those with the lowest, showing the vast potential for improvements. Furthermore, strategies to reduce emissions from methane – which accounts for half of the total emissions from oil and gas operations – are well-known and can typically be pursued at low cost.

While oil and gas production is vastly lower in transitions to net zero emissions, it will not disappear – even in a 1.5 °C scenario. Some investment in oil and gas supply is needed to ensure the security of energy supply and provide fuel for sectors in which emissions are harder to abate, according to the report. Yet not every oil and gas company will be able to maintain output – requiring consumers to send clear signals on their direction and speed of travel so that producers can make informed decisions on future spending.

The USD 800 billion currently invested in the oil and gas sector each year is double what is required in 2030 on a pathway that limits warming to 1.5 °C. In that scenario, declines in demand are sufficiently steep that no new long-lead-time conventional oil and gas projects are needed. Some existing oil and gas production would even need to be shut in.

In transitions to net zero, oil and gas is set to become a less profitable and riskier business over time. The report’s analysis finds that the current valuation of private oil and gas companies could fall by 25% from USD 6 trillion today if all national energy and climate goals are reached, and by up to 60% if the world gets on track to limit global warming to 1.5 °C.

Opportunities lie ahead despite these challenges. The report finds that the oil and gas sector is well placed to scale up some crucial technologies for clean energy transitions. In fact, some 30% of the energy consumed in 2050 in a decarbonised energy system comes from technologies that could benefit from the industry’s skills and resources – including hydrogen, carbon capture, offshore wind and liquid biofuels.

However, this would require a step-change in how the sector allocates its financial resources. The oil and gas industry invested around USD 20 billion in clean energy in 2022, or roughly 2.5% of its total capital spending. The report finds that producers looking to align with the aims of the Paris Agreement would need to put 50% of their capital expenditures towards clean energy projects by 2030, on top of the investment required to reduce emissions from their own operations.

The report also notes that carbon capture, currently the linchpin of many firms’ transition strategies, cannot be used to maintain the status quo. If oil and natural gas consumption were to evolve as projected under today’s policy settings, limiting the temperature rise to 1.5 °C would require an entirely inconceivable 32 billion tonnes of carbon captured for utilisation or storage by 2050, including 23 billion tonnes via direct air capture. The amount of electricity needed to power these technologies would be greater than the entire world’s electricity demand today.

“The fossil fuel sector must make tough decisions now, and their choices will have consequences for decades to come,” Dr Birol said. “Clean energy progress will continue with or without oil and gas producers. However, the journey to net zero emissions will be more costly, and harder to navigate, if the sector is not on board.”

 

COP 28 Agenda — Phase Down Of Fossil Fuel Inevitable & Essential

COP 28 Agenda — Phase Down Of Fossil Fuel Inevitable & Essential

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COP 28 Agenda — Phase Down Of Fossil Fuel Inevitable & Essential

COP 28 Agenda should encompass a Phase Down of Fossil Fuel that is, at this stage, an Inevitable & Essential step towards a more healthy future because, as we all know, Fossil Fuel ‘Addiction’ Is Sabotaging Every Sustainable Development Goal.

Here is how  in CleanTechnica sees it.

When COP 28 kicks off in Dubai on November 30, it may be the world’s last real chance to tackle the challenge of an overheating planet finally.

The COP 28 Climate Summit is scheduled for November 2023 in Dubai. The president of the conference is Sultan Al Jaber, who just happens to be the head of Adnoc, the national oil company of the United Arab Emirates, of which Dubai is a part.

“Wait!’” we hear you cry. “At a time when the need for urgent climate action is apparent — the heat index in the Middle East on July 18 reached 152 degrees F (67 degrees C) — the next head of a critical climate conference will be an oil executive? Is this a joke?” The answer is yes, that is exactly what is happening here, and no, it is not a joke.

 

 

The backlash against Al Jaber has been strong. The optics of this situation are just all wrong. What were the people who made this decision thinking? But before you turn away in disgust, give a listen to what Al Jaber told The Guardian recently:

“Phasing down fossil fuels is inevitable and it is essential — it’s going to happen. What I’m trying to say is you can’t unplug the world from the current energy system before you build the new energy system. It’s a transition — transitions don’t happen overnight, transition takes time.”

Al Jaber started the storm of criticism shortly after he was named to head the conference when he said the world’s emphasis should be on lowering fossil fuel emissions instead of a phaseout of fossil fuels themselves, which is a key demand of more than 80 countries.

Al Jaber told The Guardian he welcomed the scrutiny. “When we signed up to the hosting of COP 28, we knew exactly what we were signing up to. I don’t think there has ever been a country that has hosted the COP that did not get this type of pressure or heat from activists and media, so that’s part of the game. The scrutiny sometimes also makes us dig deeper into issues, understand better, analyse more to draw better conclusions. Never have I said that I have all the solutions, or I have all the answers.”

Last week, Al Jaber met with representatives from 40 nations to lay out his specific proposals for COP 28, which fell into four main topic areas.

COP 28 & The 1.5°C Goal

The Paris agreement required countries to hold global temperature rises “well below 2°C” above pre-industrial levels, while “pursuing efforts” to stay within 1.5°C. At COP 26 in 2021, world governments agreed to focus on the more stringent goal of 1.5°C. Since then, some governments have tried to refocus the discussion on 2°C, but Al Jaber has made it clear from the outset that his plan is based on the tougher goal. “This plan is guided by a single north star, and that is keeping 1.5°C within reach,” he told the assembled ministers and government officials.

Kate Hampton, chief executive of the Children’s Investment Fund Foundation, who contributed to the COP 28 plan, said,  “The commitment to 1.5°C is particularly important. The presidency has recognized it is time to accelerate the essential and inevitable end for fossil fuels. The challenge now for the presidency is to ensure delivery across a comprehensive agenda, which can only be achieved with a transformational plan for mobilizing finance.”

National Plans

At COP 28, governments will conduct for the first time a “global stocktake” that will set out the progress countries have made on the emissions reduction commitments — known as “nationally determined contributions” or NDCs — they made in Paris.

The stocktake is certain to find that the world is way off track to meet its Paris goals, but the COP presidency has decided against naming and shaming individual countries. Instead, all countries will be required to submit updated NDCs in September that are sufficiently tough to meet the 1.5°C goal. In line with that requirement, the UAE itself has submitted a revision to its NDC that contains emissions reductions of 40% compared with a business-as-usual approach.

Phase Out Or Phase Down?

Al Jaber emphasized that this effort would entail “the phase down of fossil fuels,” which he said was “inevitable and essential.” The wording is significant. He was heavily criticized two months ago for repeatedly referring to the “phase out of fossil fuel emissions,” which observers took to mean that oil and gas companies could carry on extracting fossil fuels as long as the resulting carbon dioxide was somehow captured. But scientists have warned against using carbon capture and storage technology as a “free lunch” to excuse continued extraction.

Nevertheless, the “phase down” language will disappoint the more than 80 countries that want COP 28 to pass a commitment to phasing out fossil fuels entirely.

Clean Energy

Commitments to double energy efficiency, triple renewable energy capacity to 11,000 GW globally, and double hydrogen production to 180 million tons a year by 2030 will be put to governments at COP 28, where they are expected to be agreed to.

COP 28 & Reality

Romain Ioualalen, global policy lead at Oil Change International, told The Guardian, “Recent history has shown that more renewable energy does not automatically translate into less fossil fuels. COP 28 will only be a success if its presidency sets aside the interests of the oil and gas industry and facilitates a clear outcome on the need for a decline of all fossil fuel production and use, as well as a rapid phase-in of wind and solar. The only way we’ll build a new energy system that is both clean and fair is by actively phasing out the old.”

Al Jaber wants to formulate a plan to get the world’s biggest oil and gas producers to reduce their greenhouse gas emissions in line with the 1.5°C target — this at a time when those companies are fleeing any promises made previously as they go panting after more and bigger profits from selling their climate-killing products.

 

 

To activate his plan, he intends to bring fossil fuel executives to COP 28, despite the objections of many climate advocates who well remember that there were more fossil fuel advocates in Egypt last year for COP 27 than government representatives. The Guardian says if Al Jaber can get the companies to address their duty to the environment, “it would be an astonishing step forward for climate action.”

When Al Jaber first spoke to oil and gas companies earlier this year, he focused on what they could do to make their operations less carbon intensive by improving their extraction efficiency and plugging leaks of methane. These are known as scope 1 emissions, because they are fully under a company’s control. But critics pointed out that approach ignored scope 3 emissions, which are by far the greatest impact of fossil fuels. Those are the emissions created when oil or methane is burned by customers.

Last Thursday, Al Jaber adjusted his message in response to that criticism. “Let us end the reductive discussion of scope 1 v scope 2 v scope 3. We need to attack all emissions, everywhere — one, two, and three.” That is a huge victory for climate activists.

Who Will Pay?

Talk is cheap. It is “put up or shut up” time for fossil fuel companies. Their argument is that the transition to renewables and a phaseout of fossil fuels will be too costly, but that fails to take into account the direct and indirect cost of a warming planet. By some accounts, fossil fuel interests get the benefit of nearly $7.5 trillion in direct and indirect subsidies every year. No less a personage than Elon Musk says it will cost $100 trillion to transition to a zero-carbon economy, but sticking with a business-as-usual approach will cost far more — $130 trillion.

Al Jaber called for “a comprehensive transformation” of the World Bank and other international finance institutions, and for private sector funding to be brought in. He wants to make sure that a commitment by rich countries to provide $100 billion a year to poor nations is finally fulfilled. He also repeated the demand from UN Secretary General António Guterres for a doubling of finance for developing countries to adapt to climate impacts.

The Takeaway

COP 27 last year was an unmitigated disaster where oil companies got everything they wanted. Climate advocates are right to be concerned that this year’s conclave will be another debacle. But … Al Jaber is making the right noises. He is talking the talk. Now it remains to be seen whether he can walk the walk. The world has run out of chances to get this right.

Featured image by Kyle Field | CleanTechnica

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Robots to be oil and gas industry’s growth engine

Robots to be oil and gas industry’s growth engine

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The combination of new technologies of Robots and all in the Middle East’s oil and gas industry’s growth engine is thought to help energy companies to improve efficiency and, most importantly, accelerate growth at a time of pessimism, fear, and the expectation that economic growth and the hydrocarbon markets will decline in the future.
The image above is of IGN

Robots to be oil and gas industry’s growth engine

Robots will be the industry’s growth engine, and the oil and gas sector will greatly benefit from emerging use cases.

Advances in modular and customisable robots is expected to result in growing deployment of robotics in the oil and gas industry, says GlobalData.

GlobalData’s thematic report, ‘Robotics in Oil & Gas’, notes that, while robotics has been a part of the oil and gas industry for several decades, growing digitalisation and integration with artificial intelligence (AI), cloud computing, and Internet of Things (IoT), have helped diversify robot use cases within the industry.

Anson Fernandes, Oil and Gas Analyst at GlobalData, comments: “A huge number of robots are now being deployed in oil and gas operations, including terrestrial crawlers, quadrupeds, aerial drones, autonomous underwater vehicles (AUVs), and remotely operated vehicles (ROVs).”

Robots have applications across the oil and gas industry in various tasks ranging from surveys, material handling, and construction to inspection, repair, and maintenance. They can be customised for various tasks to ease the work and improve efficiency. During the planning phases of an oil and gas project, robots can be deployed to conduct aerial surveys, or they can be employed to conduct seismic surveys during exploration. Aerial or underwater drones can be adopted depending upon the project location and work requirements.

Fernandes continues: “Robotics is a fast-growing industry. According to GlobalData forecasts, it was worth $52.9 billion in 2021 and will reach $568 billion by 2030, recording a compound annual growth rate (CAGR) of 30%. Robots will be the industry’s growth engine, and the oil and gas sector will greatly benefit from emerging use cases.”

Data analytics and robotics improve insight obtained from surveys and surveillance exercises. This symbiotic relationship between robotics and wider digitalisation technologies is expected to be further evolve through collaborations between technology providers and oil and gas industry players.

Fernandes concludes: “The volume of robotics use cases in the oil and gas industry is expected to grow rapidly, in tow with digitalisation. Industrial robots with analytical support from digital technologies is expected to become the mainstay across the oil and gas industry, especially in the upstream sector, where personnel safety and operational security concerns are heightened.”

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ITP.net

Riskiest investments and Big Oil’s greenwashing campaign

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In today’s world, the riskiest investments are in the Middle East and Africa, whilst Big Oil’s greenwashing campaign is in full swing, as described in RGnB.org.  Aren’t Big Oils and Hydrocarbon economies of the MENA in cahoots? 

The above Image is of Canva


Big Oil’s greenwashing campaign

A released new memo and documents last week showed how the fossil fuel industry engages in “greenwashing” to obscure its massive long-term investments in fossil fuels and failure to reduce emissions meaningfully, writes Dan Bacher.

The new documents are part of a Committee’s ongoing investigation into the “fossil fuel industry’s role in spreading climate disinformation and preventing action on climate change,” according to a press statement.

“Even though Big Oil CEOs admitted to my Committee that their products are causing a climate emergency, today’s documents reveal that the industry has no real plans to clean up its act and is barreling ahead with plans to pump more dirty fuels for decades to come,” said Chairwoman Maloney.

Middle East, Africa riskiest investments in the world: Report

Syria, Yemen, and Libya were on the list of the highest-risk countries in the third quarter of 2022

The Middle East and Africa (MEA) have been identified as the region with the highest risk offerings, with a score of 54 out of 100, for investors driven by “social unrest, food insecurity, rising debt, and inflation,” according to a leading data and analytics company, GlobalData.

Syria, Yemen, and Libya were on the list of the highest-risk countries in the third quarter of 2022.

The research showed that the Americas region’s risk score was 47.7 out of 100 during the third quarter, making it the second-highest area with investment risk, followed by the Asia-Pacific region at 41 and Europe at 33.4.

Rush to buy Middle East oil amid Russia supply fears in 2023

“While rising oil prices have increased the revenue of major oil producers and exporters in the MEA, high fuel costs have adversely impacted low-income nations – especially given their heavy dependence on staple food imports from Russia and Ukraine,” GlobalData economic research analyst Puja Tiwari said.

Tiwari added: “Humanitarian crisis across Lebanon, Syria, Iraq, Libya, and Yemen, along with skyrocketing poverty, is impacting the MEA region. Due to curtailment of wheat exports from two main producers in the world (especially wheat from Russia and Ukraine), many countries across the MEA are already facing a major food crisis.”

The research also showed that global risk rose from 44 and 44.9 out of 100 in the second and third quarters of 2022, respectively.

 Tiwari said the major causes of global risk include rising costs due to the onset of the Russia-Ukraine conflict and sanctions on Russia, followed by Europe’s energy crisis, China’s slowdown of growth, aggressive interest rate hikes by central banks, currency depreciation and stock market crashes.

“While governments of major economies are undertaking various fiscal measures to deal with the rising prices, this will weigh on already strained government finances. Moreover, with several economies tightening monetary policy, the increased borrowing costs will remain another challenge moving into Q4 and beyond,” Tiwari said.

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Many in Kuwait willing to pay a fee for single-use plastic bags

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Kuwait TimesShakir Reshamwala tells us that Many in Kuwait are willing to pay a fee for single-use plastic bags whilst others call for a complete ban on plastic or switch to paper bags

Many in Kuwait willing to pay a fee for single-use plastic bags

 The ecobags distributed by the Environment Public Authority to cooperative societies.

KUWAIT: Plastic bags seem to be everywhere – in parks, sewers, deserts, forests, oceans, and lately, in the news, after authorities in Dubai announced they are ending the free distribution of single-use plastic bags in a drive towards more sustainable practices. “In line with enhancing environmental sustainability and encouraging individuals to reduce the excessive use of plastics, the Executive Council of Dubai has approved the policy to limit single-use bags by imposing a tariff of 25 fils (about $0.07) on single-use bags,” the authorities said. The decision will come into force at the start of July in shops, restaurants, pharmacies and for home deliveries.

In Kuwait, there are no restrictions on single-use plastic bags, and despite attempts by supermarkets to promote reusable bags, there aren’t many takers due to their relatively high cost and the freely available plastic bags. It is common for baggers at supermarkets to place each item in separate bags, and it is not uncommon to see shoppers shamelessly grab a bunch of extra bags at checkout counters.

Nevertheless, people are waking up to the threat these plastic bags pose to the environment. In an online survey conducted by Kuwait Times whether Kuwait should also charge for single-use plastic bags, a majority of respondents voted in favor of such a move. Many however pointed out they do reuse them as garbage bags. Others called on authorities to go a step further and ban plastic bags altogether, expressing skepticism whether a token charge will deter their usage.

“There is a charge on plastic bags worldwide. Why not in Kuwait too?” one user responded. “Sell reusable canvas bags at checkouts. I’m tired of seeing a sea of plastic everywhere I go,” said another. Other respondents to the survey called for using paper bags instead, while some pointed out that waste in Kuwait needs to be segregated to make recycling easier.

Those against charging for plastic bags had their own reasons. “Ban plastic bags but use recyclable alternatives. Everything here is already expensive and overpriced. We consumers are suffering, so adding even a little more to the equation makes no sense,” commented a user. “We use those bags for the trash, so let them be free,” wrote another.

Explaining their decision, the authorities in Dubai vowed that this is the first step of a strategy planned over several stages, aimed at completely banning single-use plastic bags within two years. “With sustainability becoming a global priority, changing the behavior of the community to reduce the environmental footprint of individuals is crucial to preserve natural resources and environmental habitats,” the authorities said. In March 2020, Abu Dhabi, the capital of the United Arab Emirates, announced its “new environmental policy” aiming to eliminate single-use plastics by 2021 – but regulations have yet to be applied.

A report by wildlife group WWF last week warned plastic has infiltrated all parts of the ocean and is now found “in the smallest plankton up to the largest whale”, calling for urgent efforts to create an international treaty on plastics. According to some estimates, between 19 and 23 million tons of plastic waste is washed into the world’s waterways every year, the WWF report said. In one 2021 study, 386 fish species were found to have ingested plastic, out of 555 tested. Separate research, looking at the major commercially fished species, found up to 30 percent of cod in a sample caught in the North Sea had microplastics in their stomach.

To be fair, authorities in Kuwait are not totally oblivious to the plastic problem. In a first step, the Environment Public Authority last year distributed one million ecofriendly bags to cooperative societies in all the governorates, part of a campaign to raise public awareness about environment protection and minimize the use of plastic bags. The ecobags are made of organic materials that disintegrate in hot water without any harmful effects on the air, soil or water. Each ecobag is strong enough to carry up to 10 kg – although the weight of expectations over this move is seemingly a lot higher.

The top image is for illustration and is of Dawoodi Bohras