UK Offshore Sets Decarbonisation Timeline (Update)
(Adds comment from regulator)
UK's offshore oil and gas industry has committed to halving its greenhouse gas (GHG) emissions by 2030, confirming its pathway to becoming a net zero emissions basin by 2050 in a report published by Oil & Gas UK (OGUK) June 16. This makes it one of the first industry sectors to do set out a timetable, it said at a media briefing the day before publication.
By 2040, GHG emissions are to fall by a further 40%, set against 2018's 18.3mn metric tons of CO2 equivalent of greenhouse gases; and to zero by 2050, except for flaring gas to prevent dangerous accumulations on platforms.
Nearly all the GHGs – 91% are CO2 and 8% are methane – come from offshore; 15% come from onshore terminals and 5% from logistics, such as support vessels and helicopter flights.
Electrification, operational efficiency and flaring reductions will all play a part in this, but the aim is to be achieved basin-wide, rather than by each specific asset.
However, the major building blocks that such an ambitious goal needs – such as a workable commercial framework to attract investors to carbon capture, use and storage projects, and a reframework for offshore floating wind to generate power for hubs – remain on the government's to-do list.
Replying to a question from NGW, OGUK said there would be no trade-off with the other primary objective of maximising the economic recovery of the remaining reserves, despite the extra costs likely to be involved in electrification, for example. It also said that a large portion of the decarbonisation effort – at least half and possibly two thirds – will probably come from the decommissioning of existing and old platforms later this decade. However, it said it was difficult to be precise as timings will be influenced by factors such as commodity prices.
The targets are a key part of a transformational sector deal that industry is now formally discussing with the UK government. With jobs, the supply chain and energy communities at its core, the sector deal will consider how the UK's oil and gas industry can support a green recovery.
OGUK CEO Deirdre Michie said that the industry remained "committed to addressing the challenge of climate change, as we outlined in our Roadmap 2035 published last year. Our industry will play its part by reducing its emissions and using its skills to develop the solutions that will be needed to make a significant contribution to the UK's overall targets.
"A transformational sector deal could help unlock the full potential of this industry to support a green recovery and we're delighted to confirm that we are now in formal discussions [with government] about it. With a clear pathway to becoming a net zero basin by 2050 and with support from governments and regulators, we can protect domestic energy supplies, jobs and communities whilst embracing the opportunities which will come from being at the forefront of delivering a low carbon economy."
Energy minister Kwasi Karteng said that the offshore oil and gas sector has "a vital role to play in our energy transition in the years to come. The UK government will continue to work tirelessly with all partners to deliver a dynamic Sector Deal. This will further support the industry in becoming more sustainable, as we work towards achieving net zero emissions by 2050."
Report author Louise O'Hara Murray said that there would be annual updates on the progress made, considering the
changes to operations, progressive reductions in flaring and venting and major capital investment programmes to decarbonise production operations.
"Many of the major capital investment projects which will help our sector to decarbonise, including the powering of assets with electricity instead of hydrocarbons, the development and deployment of carbon capture and storage (CCS) and hydrogen both on and offshore, will need to be developed at scale to help other industries accelerate their own efforts to reduce emissions," she said.
The upstream regulator Oil & Gas Authority welcomed the announcement June 16. It said: “In January the OGA challenged the UK oil and gas industry to commit to clear, measurable, production emission reduction targets. Industry has responded and engaged positively and we welcome this significant and ambitious commitment. It is now crucial industry keeps pace on efforts to reduce its own footprint and also puts a strong focus on achieving impactful emissions reductions in the near term. Therefore we will incorporate these targets into our data benchmarking to track and monitor performance and progress.”