UK Upstream Follows Its Net-Zero Carbon Agenda
Upstream industry group Oil & Gas UK (OGUK) has reaffirmed its commitment to a net-zero carbon future, set out in its 2019 document, Roadmap 2035. It issued a statement January 25, following the parliamentary Environmental Audit Committee (EAC)’s comments urging the Bank of England to rethink its financial backing of oil and gas companies.
The sector outlined in 2019 its ambition for a net-zero future, highlighting its commitment to decarbonising production while supporting jobs, providing affordable energy and unlocking critical low carbon solutions, all of which will need the backing of the financial community.
OGUK sustainability director, Mike Tholen, said the sector was "investing in the energy transition using our skills ands expertise to deliver a net-zero future, responsible access to finance will be critical to deliver change at the required pace."
Identifying carbon capture and storage (CCS) as well as hydrogen as "critical low carbon solutions," he said the UK could have a fair transition but rapid action was needed. "We can lead the way in showing how oil and gas producing countries can successfully and fairly transition towards a lower carbon future in a way that brings everyone together on this journey,” he said.
The EAC had written to the bank's governor, urging him to ensure any firms receiving bank finance should disclose their climate-related activities. According to the BBC, the MPs focused on two areas of investment: Covid emergency funding and long-term corporate bonds. The EAC says about 230 large companies are said to have been granted financial help to weather the Covid crisis.
UK upstream regulator Oil & Gas Authority wants to achieve two goals: maximising the economic recovery of oil and gas; and meeting the national net zero carbon goal of 2050. A number of companies are working with government on creating a value chain for CCS, as well as branching out into offshore wind and other zero carbon ways to generate power for rigs instead of using diesel or gas.
An alternative, pursued by companies like Zennor, is to buy carbon offsets to cover the carbon emissions from offshore installations, although its owner, Kerogen, says this is a short-term solution only. The UK offshore accounts for a very small percentage of the country's total carbon emissions.