Oil Giants Pledge $1 Billion to Lower Emissions

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Some of the world's leading oil and gas producing companies have pledged to spend $1 billion over the coming decade to develop and deploy commercial-scale low emissions technologies.

The Oil and Gas Climate Initiative (OGCI), which was formed in 2015 by 10 of the biggest players, said it will focus its work on two areas to begin with: carbon capture and storage (CCS) and the reduction of methane emissions from the global Oil & Gas industry. The group said that these areas were "where the oil and gas industry has meaningful influence and where its collaborative work can have the greatest impact." The group has no plans to collaborate on renewable energy research and development.

The group includes companies like BP plc (NYSE:BP) (London, England), Eni SpA (Rome, Italy), Royal Dutch Shell (NYSE:RDS.A) (The Hague, Netherlands) and Statoil ASA (NYSE:STO) (Stavangar, Norway). For additional information, see October 21, 2015, article--Big Oil Companies Promise Climate Change Action.

"The creation of OGCI Climate Investments shows our collective determination to deliver technology on a large scale that will create a step change to help tackle the climate challenge," said the the OGCI in a joint statement. "We are personally committed to ensuring that by working with others our companies play a key role in reducing the emissions of greenhouse gases, while still providing the energy the world needs."

The new OGCI Climate Investments (OGCI CI) arm said it will also work to "cut the energy intensity of both transport and industry."

Despite marking the largest collective investment made by the Oil & Gas Industry toward reducing emissions in its own sector, individual members of the OGCI are investing much larger amounts in renewable energy programs. In recent weeks, OGCI member Total S.A. (NYSE:TOT) (Paris, France) announced it plans to spend about $500 million a year on renewable energy projects, while Italian energy giant ENI has committed to investing 1 billion euros ($1.1 billion) over the next three years on solar projects. In May, Shell announced a separate New Energies division to invest in renewable and low-carbon energy with an initial capital investment of $1.7 billion. For additional information, see May 23, 2016, article--Shell to Launch Renewable Energy Division.

At the start of this year Norwegian oil and gas company Statoil ASA (OSE:STL) (Stavangar) announced a $200 million renewables investment fund, which will be used to finance projects in Europe and the U.S. In May, the company bought its way into the German offshore wind sector by purchasing a 50% stake in the Arkona offshore windfarm for 1.2 billion euros ($1.4 billion). For additional information, see February 24, 2016, article--Statoil Launches $200 Million Renewable Energy Fund and May 11, 2016, article--Statoil Enters German Offshore Wind Market.

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