COP28 team lines up oil and gas industry alliance ahead of climate summit

A new oil and gas sector alliance has been organized by the COP28 team behind the United Nations climate summit in the UAE, but early outlines of its goals aimed at tackling global warming fail to include most emissions from the use of fossil fuels.

Billed like a flagship COP28 initiative, the Global Decarbonization Alliance, tentatively called the Global Decarbonization Alliance, will set a goal of achieving net-zero emissions by 2050 from direct emissions and emissions derived from the energy companies buy, known as scopes 1 and 2, says a letter startup seen by the Financial Times.

However, the framework outlined in the letter does not include a target for so-called Scope 3 emissions, which are indirect emissions that make up by far the largest share of industry pollution.

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

He told the rally that the oil and gas industry “has the capacity and resources to help everyone tackle Scope 3 emissions.” The sector “needs to step 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 fractionof which they were ambitious enough, according to the International Energy Agency.

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

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

A private seminar will be held in the UAE next week where the alliance and the interim framework will be discussed.

COP28 said it would not comment on the leaked documents.

The recent letter outlining the goals was addressed to COP industry partners and sent by Samir Elshihabi, head of COP28 energy transition, who worked at Occidental Petroleum in Abu Dhabi. “We aim to achieve net zero emissions (Scope 1 and 2) under our control and work with partners to achieve the same in unmanaged operations, by 2050 or earlier,” he said.

While it doesn’t include reference to a quantifiable goal for Scope 3 emissions, it does say supporters of the planned alliance will be asked to support “ambition” to work with customers, partners and other energy-intensive industries to reduce emissions of greenhouse gases.

Sets rolling targets for methane in upstream production. Methane is the main component of gas and a powerful contributor to global warming that can escape during production and distribution. It is estimated to account for about 30% of the global temperature increase since the Industrial Revolution, with the energy industry accounting for about a third of human-induced methane.

The letter proposed the goal of ending all routine flaring, in which gas produced during oil production is burned rather than collected.

“We aim for routine zero flaring and nearly zero methane emissions by 2030 in our upstream operations,” he said, making no reference to methane in midstream or pipeline operations.

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

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

The petrostat has consistently said it wants to put fossil fuel producers at the center of efforts to tackle climate change.

At the Petersberg climate talks in Germany last week, attended by more than 40 country representatives, Jaber said fossil fuels “will continue to play a role for the foreseeable future” and highlighted the use of capture and carbon storage to harvest emissions from highly polluting industries, a technology yet to be tested on a large scale.

An official summary of the Berlin talks said there was “a lot of debate” among representatives about the extent to which carbon capture and storage should be used in the energy sector. Some have expressed “caution” about “the cost, unclear timing, potential to delay transition, and environmental impacts” of CCS’s association with fossil fuels, he said.

In discussions about scaling up renewable energy, “some” countries have stressed the need to “replace” fossil fuels with clean energy sources, the summary notes.