Having long endured the stigma of being associated with one of the world’s worst man-made disasters, the March 24, 1989, oil spill during which its recovery ship, the Exxon Valdez, emptied almost eleven million gallons of crude oil into Alaska’s Prince William Sound, it has taken years for ExxonMobil, one of the world’s unquestioned oil exploration and recovery powerhouses to work its way back to some measure of global respectability as far as its global safety reputation is concerned; and while, even now, the jury is still out in some quarters on the environmental bona fides of the company, the reality is that the global significance of oil coupled with ExxonMobil’s credentials in what is arguably one of the world’s most critical economic sectors, means that whatever the purist perspective of the hard-core environmentalists, the company’s strategic importance to the overall well-being of the global oil and gas industry cannot be wished away.
Not so, at least, for Guyana, where the company’s fourteen significant oil finds in just over four years has firmly anchored it to the country’s economy and where, these days, policy makers would appear to have little option but to be persuaded that Exxon’s deliberate and costly image-building efforts to work its way back into the ‘good books’ of the environmental ‘diehards’ will eventually succeed.
To some extent it has made a measure of progress, having a year ago, joined the prestigious Oil and Gas Climate Initiative (OGCI), a high-powered ‘Club’ of mostly Chief Executive Officers (CEO’s) assigned to lead the oil industry’s response to climate change. Launched at the UN Secretary General’s Climate Summit in New York in September 2014, OGCI then comprised ten oil and gas companies “that pool expert knowledge and collaborate on action to reduce greenhouse gas emissions.” With no resource-related constraints, OGCI’s Climate Investments has set up a billion-dollar fund which has been dedicated to “technologies and business models that have the potential to significantly reduce greenhouse gas emissions,” though even that has failed to still the voices of the cynics who question the extent to which the OGCI’s paychecks impact positively on climate change.
The rhetoric associated with the mission of OGCI is arguably as impressive as the US$100 million cheques which its members write annually. It asserts a commitment to the directives set out in the Paris Agreement on Climate Change. Literature on the organisation says that it “aims to increase the ambition, speed and scale of the initiatives we undertake as individual companies to reduce the greenhouse gas footprint of our core oil and gas business – and to explore new businesses and technologies.” It goes on: “OGCI is keen to work with our partners, customers and policy makers, acting as a catalyst for wider investment. We aim to achieve this by collaborating with partners and by sharing knowledge and collective resources to accelerate the use of innovative solutions. OGCI Climate Investments will develop and accelerate the commercial deployment of innovative low emissions technologies. These have the potential to reduce greenhouse gas emissions on a significant scale during the next decade.”
Specifically, the organisation collaborates and invests with other stakeholders in four main pursuits, namely, carbon capture, utilisation and storage, reducing methane emissions, improving energy efficiency in industry and reducing transport emissions.
As has already been mentioned the OCGI, for all its noble motives, is as good an imitation as any of a ‘rich man’s club,’ their respective US$100 million contributions going into technologies associated with pursuits like carbon capture, utilisation and storage, reducing methane leaks from their operations, improving energy efficiency and cutting emissions from transport.
ExxonMobil itself has been taking sober environmental initiatives on its own. Just recently it concluded agreements with the Indian Institute of Technology at campuses in Madras and Bombay that will expand an already extensive portfolio of research collaboration with universities in India. The preoccupation of the recent agreements is with research into biofuels and bio products, gas transport and conversion, climate and environment, and low-emissions technologies for the power and industrial sectors. These initiatives add to existing ones in lower-emissions research programmes with more than 80 universities, five energy centres and multiple private sector partners. Since 2000 ExxonMobil has reportedly spent US$10 billion developing and deploying lower-emissions energy solutions.
ExxonMobil has also reportedly been involved recently in a joint study with the Indian Institute of Technology in Bombay and the Council for Energy, Environment and Water, an Indian think-tank that examines India’s projected electricity demand growth over the next 20 to 30 years and compared emissions associated with power generated by domestic coal and imported liquefied natural gas (LNG). It found that, on average, life cycle greenhouse gas emissions from LNG imported into India are approximately 54 per cent lower than those associated with Indian coal.
Now a 13-member group, the OGCI at a recent meeting which reportedly attracted the CEO’s and representatives of its member companies; BP, Chev-ron, China National Petro-leum Corporation (CNPC), Eni, Equinor, ExxonMobil, Occidental, Pemex, Petro-bras, Repsol, Royal Dutch Shell, Saudi Aramco and Total,
is said to have reported progress in curbing methane leakage, promising further support for investment in carbon capture, storage & use projects and pledging to set a common emissions intensity target in the year ahead. What is probably equally significant about the meeting is the extreme rarity of having that many industry leaders gathered in the same place at the same time. It signals, observers believe, the willingness of the movers and shakers in the oil and gas industry to engage on the issue of climate change. Going forward, the industry leaders are expected to be guided by a “carbon benchmarking tool” that provides what has been described as “a forward-looking, asset-level view of emissions and related policy and financial risks for 25 of the largest oil and gas companies.”
The group’s members have set a collective target to cut methane leakage to 0.25% of their production by 2025. According to the OGCI’s own calculations, they are on track to meet that target. However, they will need to maintain progress with new technologies and management systems, and extend their emissions mitigation efforts beyond methane, if they are to deliver fully on their pledges to align themselves with the ambitions of the Paris Agreement.
