COP28 team marshals oil and gas industry alliance ahead of climate summit

A new alliance of the oil and gas sector is being marshalled by the COP28 team behind the UN climate summit in the United Arab Emirates, but early outlines of its goals aimed at tackling global warming do not include the bulk of emissions that arise from the use of fossil fuels.

Billed as a flagship COP28 initiative, the provisionally named Global Decarbonization Alliance will set a goal of reaching net zero emissions by 2050 from direct emissions and emissions derived from the energy the companies purchase, known as scope 1 and 2, an initiating letter seen by the Financial Times says.

However, the framework as it is outlined in the letter does not include a target for so-called scope 3 emissions, or the indirect emissions that make up by far the biggest proportion of the sector’s pollution.

The central question of these emissions was addressed by Sultan al-Jaber, president-designate of COP28 and head of the state-owned Abu Dhabi National Oil Company, in a speech to the CERAWeek energy conference in March.

He told the gathering that the oil and gas industry “has the capacity and the resources to help everyone address scope 3 emissions”. The sector “needs to up its game, do more and do it faster”.

Companies responsible for just under half of global oil and gas production have individually announced plans or targets to reduce scope 1 and 2 emissions, “only a fraction” of which were sufficiently ambitious, according to the International Energy Agency.

“It’s hard to see much decarbonisation in the Global Decarbonization Alliance,” said Thomas Hale, director of the independent research group Net Zero Tracker, adding that any “credible” oil and gas COP initiative must address scope 3 emissions.

“The UAE as an oil and gas producer has a major opportunity to be the transformative force to bring together the whole industry to take this challenge seriously.”

A private workshop is expected to take place next week in the UAE where the alliance and provisional framework will be discussed.

COP28 said it would not comment on leaked documents.

The recent letter outlining the goals was addressed to COP industry partners and sent by Samir Elshihabi, COP28 energy transition lead, who has worked at Occidental Petroleum in Abu Dhabi. “We aim to reach net zero emissions (Scope 1 and 2) under our control, and work with partners to achieve the same in non-operated assets, by or before 2050,” it said.

While it does not include reference to a quantifiable target for scope 3 emissions, it says that supporters of the planned alliance will be asked to back an “ambition” to work with customers, partners and other energy intensive industries to reduce greenhouse gas emissions.

It does set out progressive targets for methane in upstream production. Methane is the main component of gas and a potent contributor to global warming that can leak during production and distribution. It is estimated to account for about 30 per cent of the global temperature rise since the industrial revolution, with the energy industry making up about a third of human-induced methane.

The letter proposed a goal to end all routine flaring, where gas produced during oil production is burnt off rather than collected.

“We aim for zero routine flaring and near-zero methane emissions by 2030 on our upstream operations,” it said, without making reference to methane in midstream or pipeline operations.

The Oil and Gas Climate Initiative, launched in 2014, which is backed by Saudi Aramco, BP, ExxonMobil and other big oil and gas companies, already has a similar stated target of zero methane emissions.

The UAE-backed initiative includes the proposal that oil and gas companies in the alliance should aim to measure, verify and report their progress on cutting emissions and investment plans on how to do so, initially focused on 2030.

The petrostate has consistently said it wants to bring fossil fuel producers into the heart of efforts to tackle climate change.

At the Petersberg climate talks in Germany in the past week, attended by more than 40 country representatives, Jaber said fossil fuels would “continue to play a role in the foreseeable future”, and emphasised the use of carbon capture and storage to collect emissions from highly polluting industries, a technology yet to be proven at scale.

An official summary of the talks from Berlin said there had been “much debate” among the representatives about the extent to which carbon capture and storage should be deployed in the energy sector. “Caution” was voiced by some about “the cost, unclear timescales, potential to delay the transition, and environmental impacts” of pairing CCS with fossil fuels, it said.

In discussions about increasing renewable energy, “some” countries had stressed the need to “substitute” fossil fuels for clean sources of power, the summary noted.