Oil giants gambling on emissions mitigation technologies

12th May 2022


The climate targets of oil and gas majors rely heavily on emissions mitigation technologies (EMTs) that are expensive and unproven at scale, analysis by Carbon Tracker has uncovered.

In a report published today, the think tank claims that only four of the world's 15 largest publicly traded oil and gas companies plan absolute cuts in emissions from production and use of products.

Instead, these firms have turned to EMTs, selling assets and buying offsets to cut emissions while justifying continued investment in production.

For example, Eni plans to build plants in the North West of Britain and Ravenna, Italy, which will each capture and store 10 million tonnes (10Mt) of CO2 a year by 2030. However, this only covers industrial processes, and will not reduce emissions from its own products.

Meanwhile, Total lists a 13,500 square kilometre forest in Peru among its offsetting projects, claiming it will help “prevent” more than 15Mt of CO2 over 10 years, but it is not planting any new trees.

The report warns that companies could face litigation, regulatory sanctions, and reputational damage if EMT projects fail to capture or offset the intended amount of carbon.

“Oil and gas companies are gambling on emissions mitigation technologies that pose a huge risk to both investors and the climate,” said Maeve O’Connor, Carbon Tracker analyst and report author.

“Most of these technologies are still at an early stage of development, with few large projects working at anything like the scale required by company goals, while solutions that involve tree planting require huge areas of land.

“While limiting global temperature rise to 1.5°C will likely require some level of EMTs, they should be used to reduce or offset emissions for sectors like aviation or chemicals, where few low-carbon alternatives currently exist, rather than to justify new fossil production.”

The report highlights how Chevron, Shell and ExxonMobil have been obliged to buy AU$184m of carbon offsets because their jointly owned Gorgon carbon capture plant in Australia failed to meet targets agreed with the government.

Looking beyond offsets and EMTs, the researchers also explain how selling assets to cut emissions can also lack credibility, because this just shifts emissions from one owner to another who could increase production or operate under less stringent environmental standards.

The analysis shows that Eni is the company with the strongest climate policy, having pledged a 35% cut in absolute emissions by 2030. ExxonMobil has the weakest policy, with its net-zero target excluding 95% of lifecycle emissions from the products it sells.

Mike Coffin, Carbon Tracker's head of oil, gas and mining, said: “Financial institutions must scrutinise companies’ emissions targets and whether their plans to achieve them are practical and credible in order to assess alignment with global climate goals.

“This is particularly so for companies which seek to 'create space' for further fossil investment. The best way for companies to reduce both their climate impact and transition risk exposure for investors is to allow their existing production to decline without investing in new assets.”

Image credit: iStock


Transform articles

UK not on track to deliver net zero, CCC warns

The UK's strategy for decarbonising the economy will not deliver net-zero emissions by 2050 if progress continues on its current trajectory, the Climate Change Committee (CCC) has warned today.

29th June 2022

Read more

The UK Infrastructure Bank has today published a £22bn plan to tackle climate change and boost regional growth, making clean energy the largest area of investment.

23rd June 2022

Read more

Europe can achieve a clean, reliable and expanded power system by 2035 with a similar overall cost to current plans for a smaller and more polluting supply, new modelling has found.

22nd June 2022

Read more

Climate-related floods and droughts are set to impact millions more people and cost the world’s major cities $194bn (£158bn) every year by 2050, new forecasts suggest.

22nd June 2022

Read more

The Association of British Insurers (ABI) has revealed that the vast majority of its members in the pensions and long-term savings industry are now part of the UN's Race to Net Zero campaign.

9th June 2022

Read more

Three-quarters of UK pension schemes have plans to align their investments with net-zero emissions, or will do within the next two years, a recent survey has found.

26th May 2022

Read more

Tom Pashby talks about why the new Natural History GCSE is such an important step forward for climate and biodiversity preservation

26th May 2022

Read more

Tom Pashby gauges IEMA members’ reactions to recent IPCC reports

26th May 2022

Read more

Financial constraints are the biggest challenge for seven out of 10 councils when looking to achieve net-zero emissions, a survey of decision-makers at 50 UK local authorities has uncovered.

20th May 2022

Read more

Media enquires

Looking for an expert to speak at an event or comment on an item in the news?

Find an expert