2023-05-13 14:55:00
(Ecofin Agency) – According to the International Energy Agency, solutions exist to drastically reduce CO emissions2 in the hydrocarbon sector by 2030. Their implementation would cost no more than 2 dollars per barrel. The companies that have implemented them pollute 4 times less than those that have not yet done anything to clean up their operations.
The COP28 Climate Change Conference, to be held in Dubai this year, represents a unique opportunity for the oil and gas industry to demonstrate its commitment to tackling climate change. The International Energy Agency (IEA), through its Executive Director, Fathi Birol, has proposed several solutions to help this industry reduce its emissions.
First, the IEA recommends tackling methane emissions and ending the practice of non-emergency flaring. This practice involves burning the gas produced, releasing significant amounts of emissions into the atmosphere. Technologies and measures exist to reduce these emissions by three quarters in a short time. In addition, most of the expenses necessary to implement these measures can be covered by the sale of the captured gas, making this solution profitable.
Next, the electrification of upstream operations is another key lever identified by the IEA. Currently, producers often rely on highly polluting diesel or natural gas generators to power their facilities. They could connect to power grids or use renewable energy, such as solar photovoltaic or wind coupled with back-up storage systems, to meet this need today.
In addition, the IEA encourages the development of low-emission hydrogen as well as carbon capture, use and storage. The oil and gas industry is already at the forefront of these technologies and should use them more in its own operations. It would also help reduce costs and provide potential benefits for other industries, such as steel, cement and fertilizers.
The IEA also stresses the importance of monitoring, reporting and verifying emissions. Industry should strive to measure all of its emissions robustly as soon as possible to build public confidence.
The agency reiterates that reducing emissions is no excuse for not tackling emissions caused by the use of the fuels themselves in transport, heating, electricity generation and other activities . Instead, industry must work collaboratively with governments and other sectors to accelerate the transition to clean energy.
Thus, the IEA offers a clear and achievable plan for the oil and gas industry to reduce its emissions by 60% by 2030. This is an opportunity for the industry to show its commitment to the fight against the climate change at COP28 in the United Arab Emirates, and to demonstrate that it can contribute positively to this cause.
In this perspective, the IEA plans to publish a special report ahead of COP28, which will help chart the course for oil and gas producers in the transition to carbon neutrality. This report will highlight the existing technologies, the financial resources available and the know-how needed to achieve this significant reduction in emissions.
Finally, the IEA stresses the importance of increased responsibility for the entire oil and gas industry. It is essential that the whole industry raises its level of performance to approach that of today’s best standards. Reducing emissions would, on average, add less than $2 to the cost of a barrel of oil at facilities implementing these measures, which is a small price to pay for a more sustainable future.
There is currently a huge variation between different oil and gas producers in terms of the emissions from their operations: the worst emit four times as much as the best. If the oil and gas industry wants to be taken seriously in climate discussions, it must adopt these solutions and clean up its practices, concludes Fathi Birol.
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