Saudi, US initiative for net zero oil producer arouses skepticism

Five countries responsible for 40% of oil and gas production have launched an unprecedented climate alliance – but leaving fuel in the ground is not on the agenda

Five major oil and gas producing countries have created a “Net Zero Producers Forum”, as part of a new climate alliance covering North America and the Persian Gulf.

At Joe Biden’s climate summit on Friday, the United States, Canada, Norway, Saudi Arabia and Qatar – together responsible for 40% of global oil and gas production – put in place a forum “which will develop pragmatic strategies for net zero emissions”.

According to joint statement.

There was no mention of leaving oil in the ground, an omission that climate advocates were quick to criticize.

Tzeporah Berman, Chair of the Fossil Fuel Non-Proliferation Treaty Campaign, said in a statement: “[This] is worrisome because all of these countries continue to increase fossil fuel production and spend billions of dollars on technologies to reduce emissions “per barrel” rather than to manage a fair decline in overall emissions and production. If your house is on fire, you don’t add more fuel.

US climate strategist Tamara Toles O’Laughlin agreed: “There is no such thing as a net zero oil producer. This belies the concept. We have to achieve zero emissions to survive, which means we literally have to keep fossil fuels in the ground. This forum will only be useful if it leads to a transparent, fair and accelerated phase-out of fossil fuel production. “

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Chatham House energy analyst Glada Lahn told Climate Home News that the United States, Saudi Arabia and Qatar are not politically ready to talk about a controlled decline in the oil sector.

But Canada and Norway “could go much further,” she said, “given their more sophisticated capacities for economic diversification.” Planning for a just transition away from fossil fuels takes a long time, she said, so it’s best to start early.

Denmark is the largest oil-producing country – 39 in the world – to have announced an exit plan, with the last barrel due to be mined before 2050. California Governor Gavin Newsom on Friday directed his administration take steps to phase out oil and gas production by 2045.

While the long-term vision may be lacking, the forum could make quick wins by tackling emissions of methane, a more potent warming gas than carbon dioxide.

Methane emissions from the oil and gas sector. (Graphic: The International Energy Agency)

Oil and gas producers vent or burn methane when it is not profitable or impractical to sell it. Methane can also enter the atmosphere during extraction, refining and transportation processes. Before the pandemic, methane emissions from the oil and gas sector around the world were increasing.

Jonathan Banks is the director of methane at the Clean Air Task Force. He told Climate Home News: “Reducing oil and gas methane is by far the easiest and most important thing we can do over the next few years to dramatically reduce global warming. It is not rocket science. We don’t need to create fancy new technology. It’s basically plumbing.

Technologies such as vapor recovery units, gas purges and infrared cameras can detect and repair methane leaks. According to the IEA, many of these technologies pay for themselves quickly because they reduce gas wastage.

The banks said Norway’s main motivation was its desire to signal to the EU that its energy is clean. the The EU obtains 7% of its oil and 18% of its gas from Norway.

U.S. gas companies also view Europe as a market for their gas, Banks said. “In the United States, we have tons of essentially free gas – which is just flared and vented and even piped into pipelines at zero cost.”

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Saudi Arabia and Qatar have been trying to diversify their economies away from oil for several years. “They know where things are going,” Lahn said.

According to the World Bank, between 2012 and 2018, the hydrocarbon sector has grown from 45% of GDP to 42% in Saudi Arabia and from 58% to 47% in Qatar.

The joint statement uses the phrase “circular carbon economy” (ECC), suggesting Saudi influence on the text.

CCE is a concept promoted by the Saudi government in international forums like the G20. It emphasizes the use of technologies such as carbon utilization and storage (CCUS) and hydrogen.

CCUS involves capturing carbon dioxide emissions from power plants or industrial processes and pumping them into underground storage – often helping to extract more oil from reservoirs in the process. Its supporters say it is a practical way to cut emissions, while critics say it is expensive and allows continued production of oil and gas.

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