Tuesday, November 22, 2016

Oil and Gas Companies in North America Less Green than Those in EU

Pressure on companies is likely to abate further in the US in the next few years under the Trump presidency. (Photograph Credit: Mark Ralston/AFP/Getty Images) Click to Enlarge.
Oil and gas companies in North America are lagging behind their European counterparts in cleaning up their operations, new research has found, with higher greenhouse gas emissions and less investment in clean alternatives.

ExxonMobil and Chevron of the US, alongside Canada’s Suncor, ranked lowest in a review conducted by the Carbon Disclosure Project (CDP) of 11 of the world’s biggest oil and gas companies.  At the top of the table came Statoil of Norway, Italy’s Eni and the French company Total.

Companies were rated on criteria including their greenhouse gas emissions and their asset mix, which is determined by the hydrocarbons they extract, and the methods used; their climate-related goals, such as investments in renewables and other forms of low-carbon energy, if any; whether they make efforts to capture and use methane, or flare it; their use of water, and whether they are likely to be affected by water shortages; and the efficiency of their operations.

The North American companies ranked so low in part because of their exposure to tar sands, particularly in Canada, and their lack of investment in conventional gas.  This is in part explained by the history and geography of the different companies involved:  Suncor, for instance, from its headquarters in Montreal, set up the first commercial operation to exploit the Canadian oil sands in the 1960s; while Statoil, with its history of exploration in the North Sea, has had a longer focus on conventional gas.

However, factors such as investment in alternatives to fossil fuels, and efforts to reduce emissions from their operations, are matters that are within each company’s control.  European companies also face more pressure from governments and activists to become cleaner and reduce emissions, while such pressure is likely to abate further in the US in the next few years under the presidency of Donald Trump and a Republican-dominated Congress.

Three major companies – Saudi Aramco, Russia’s Rosneft and PetroChina – were unranked in the CDP report, entitled In the Pipeline and published on Tuesday, because they refused to respond to the organisation’s questions.

The Bank of England is also pursuing greater disclosure on climate change issues from the oil and gas sector, with a view to assisting investors.  Mark Carney, the governor, has asked a taskforce on climate-related financial disclosure to report to him in December, giving information that would be useful for investors to judge the climate strategies of fossil fuel companies.

Read more at Oil and Gas Companies in North America Less Green than Those in EU

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