A recent report reveals that the majority of state-owned oil companies globally are not adequately incorporating the energy transition into their practices and strategies. These firms, pivotal players in the global energy industry, continue to focus on fossil fuel exploitation, despite mounting warnings about the adverse effects of climate change and the necessity to cut greenhouse gas emissions.
The Upcoming Climate Debate
The forthcoming United Nations Climate Change Conference COP28 is likely to ignite heated debate on whether to phase down or phase out fossil fuels. UN Secretary General Antonio Guterres stresses the need for a clear and credible commitment to phase out fossil fuels, but many countries are more inclined to language suggesting a reduction rather than elimination of fossil fuels. The European Union's official negotiating position for COP28 underlines the transition towards a climate-neutral economy, necessitating the global phase-out of unabated fossil fuels. This distinction between phasing down and phasing out is a key point of contention at the summit.
Carbon Capture Controversy
There's a notable ambiguity around the term 'unabated' and the challenges associated with carbon capture and storage technology. The report highlights the urgent need for state oil firms to abandon the illusion that implausibly vast amounts of carbon capture is the solution to the global climate crisis.
The Role of State Oil Companies
OPEC issued a staunch defense of the oil-and-gas industry, lambasting the International Energy Agency for 'unjustly vilifying' the industry over its role in the climate crisis. The report underscores the chasm between international environmental commitments and the actions of state oil companies, which wield considerable resources and significantly impact energy markets. The summit president, Sultan Al Jaber, also heads the OPEC producer's state oil company, making this one of the most contentious climate summits to date.
In a parallel development, NDP MP Charlie Angus plans to summon the CEO of Suncor to explain the company's shift away from a clean energy focus. Suncor's CEO, Rich Kruger, stated the company needed to revise its direction towards immediate financial opportunities in the oilsands. This move has drawn criticism from various MPs and government officials regarding Suncor's stance on clean energy investments. The government intends to publish draft regulations setting a cap on greenhouse-gas emissions from the oil and gas industry, further underscoring the tension between environmental commitments and corporate strategies.