10 Oil & Gas Bosses Seek to Improve Image Before Climate Change Summit

By and Bate Felix | October 16, 2015

Oil and gas industry bosses called for an “effective” agreement at the United Nations climate change summit in December, recognizing that current greenhouse gas emissions were inconsistent with the goal of limiting global warming.

The leaders of 10 companies said on Friday they would collaborate to limit gas flaring from refineries but stopped short of outlining clear goals to limit emissions, which climate scientists have called for to meet a goal of limiting global warming to 2 degrees Celsius over pre-industrial times.

In an unprecedented show of unity, the bosses of Europe’s top oil companies will be joined later on Friday at a news conference by the heads of the national oil companies of Saudi Arabia and Mexico, who will lend their support to the initiative.

For many of the companies, this is a fight for the future of the oil and gas sector in the public debate as a rising number of organizations and politicians call for minimizing the use of fossil fuels in favor of renewable energy such as wind and solar power.

“Sometimes in all these discussions you have the impression that all fossil fuels are the bad guys. But the bad guys are part of the solution,” Total’s CEO Patrick Pouyanne told a gas and electricity summit in Paris on Thursday.

“Whatever people think, we still need fossil fuels. We need to make advocacy for gas. We need to explain to our policy makers that gas has to be encouraged,” Pouyanne said.

“Policy makers are not convinced in many countries that gas is part of the solution for climate change, we in the industry need to speak up.”

The joint stance at a time when all companies are struggling with a sharp drop in oil prices also highlights a deep rift with U.S. oil companies such as Exxon Mobil and Chevron, who stayed away from the initiative.

The chief executives of Total, Britain’s BP and BG Group, Italy’s Eni, Norway’s Statoil, Spain’s Repsol, Saudi Aramco and Pemex will again call for a global pricing system on carbon, which they say will give an economic incentive for the private sector to use cleaner sources of energy and to develop new technologies such as carbon capture and storage (CCS).

They will again urge governments to ditch coal in favor of less polluting natural gas in power plants and heavy industry.

Climate Pledges

Diplomats gather in Bonn from Monday for the last formal session ahead of the Paris climate talks in December, where negotiators from almost 200 nations will meet to try to forge a global climate change agreement, designed to curb rising greenhouse gas emissions.

National pledges to cut emissions, even if fully implemented, would cap global warming at 3 degrees Celsius, the European Commission said on Monday, rather than the 2 degrees which international climate scientists say is the target to avoid dangerous consequences, such as more frequent and severe droughts, floods, heatwaves and rising sea levels.

The International Energy Agency forecasts oil will remain the largest energy source by 2040, although its share will decline while renewable sources of energy will grow.

All major emitting countries have now submitted plans to the United Nations detailing how much they plan to curb their emissions.

Many members of the Organization of the Petroleum Exporting Countries (OPEC), including leader Saudi Arabia, have yet to submit their plans.

For oil executives, pledges by key oil consuming countries including China and India to cut fossil fuel consumption have crystallized their need to act.

The World Bank estimates around 300 million tonnes of carbon dioxide (CO2) is emitted from gas flaring each year, equivalent to around 77 million cars.

Total, Statoil, Shell, Eni and BG are signed up to a U.N. initiative to stop routine gas flaring by 2030.

Critics say however that without clear goals to cut their emissions, oil companies’ efforts would have little impact.

Charlie Kronick of environmental campaign group Greenpeace said: “Their latest intervention contains nothing meaningful that will significantly aid the decarbonisation of the global economy.”

(Additional reporting by Susanna Twidale in London, Ana Martinez in Mexico; editing by Janet Lawrence)

Topics Energy Oil Gas Climate Change

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