Opinion Piece - Destination Net Zero – delivering a sustainable future


Wednesday 28 August 2019

Paul de Leeuw
Professor Paul de Leeuw, Director of the RGU Energy Transition Institute, reflects on the role of the oil and gas sector in helping to deliver Scottish/UK government targets of net zero greenhouse gases by 2045/2050

Following the publication of the Committee on Climate Change (CCC) report in May 2019, the UK Parliament declared a ‘climate change emergency’. This was re-enforced by similar declarations from the Scottish and Welsh Governments and by many cities and towns across the UK.  Although there is no single definition of what a climate change emergency actually means, it has become a catalyst for demanding immediate action and policy changes across the country to mitigate the causes of climate change. Governments responded by declaring targets to deliver ‘net zero’ greenhouse gases by 2050 (2045 in Scotland).

So how can the oil and gas sector react to this climate change emergency in a credible and impactful way? Unfortunately, there are no easy answers. According to UK government statistics, the consumption of hydrocarbons for transport, aviation, heating, power generation, industrial activities and other uses currently generates over 70% of all greenhouse gas emissions in the UK.  

The CCC report highlights that the offshore oil and gas sector currently represents c. 3% of all the greenhouse gas emissions in the UK. This figure reflects the emissions associated directly with offshore-related activities, such as oil and gas production, offshore power generation and the transportation of hydrocarbons from offshore to onshore, but excludes the emissions associated with the consumption of oil and gas in the UK.

The overall greenhouse gas emissions from the UK’s offshore operations are roughly half of those from the UK’s aviation sector and substantially less than the greenhouse gas emissions associated with the UK’s farming and agriculture sector (c. 11%). The CCC report also highlights that oil and gas will remain a critical part of the UK’s energy mix to the extent that by 2050, it will still contribute c. 37% of the UK’s primary energy needs.

Delivering the net zero target for the UK will inevitably mean a radical overhaul of the way we all live and work today. It will touch every part of our society and not just the oil and gas sector. For the oil and gas industry to keep its ‘social license to operate’ and to have a sustainable future here and across the world, it will need to be a major part of the solution. It will need to become a net zero greenhouse gas offshore basin in the UK and to be a key contributor in ensuring the country meets its net zero targets over the coming decades. The industry has already made progress. The OGUK Environment Report 2019 highlights that, despite production increasing by around 20% since 2014, the CO2 emissions per unit of production continue to decline.

Even though the UK currently only represents c. 1% of global CO2 emissions, around 1% of the world’s oil and gas production and roughly 1% of the world’s population, the UK and the UK’s oil and gas industry can play a leading role in the response to the climate change emergency. Combined with offshore electrification, carbon capture utilisation and storage and a leveraging of the potential benefits associated with hydrogen generation, the industry has a real opportunity of delivering a net zero basin by 2050 or earlier. This will enable the UK to continue to be a leading and cleaner oil and gas basin, whilst balancing any residual greenhouse gas emissions through offset mechanisms.

The UK’s oil and gas sector also has the skills, assets and capabilities, along with a proven track-record of developing, implementing and managing large and complex projects, to be a critical part of the solution. This expertise and capability can be readily applied to new projects, including industrial scale carbon capture utilisation and storage and hydrogen production. The UK’s CCC report identified the requirement to store potentially up to 175 million tonnes of CO2 annually by 2050 if we are to deliver the UK net zero agenda. The oil and gas industry, in collaboration with others, is uniquely positioned to leverage its expertise and the offshore asset base to contribute to this outcome.

A number of carbon capture and storage pilot projects are currently being progressed in the UK, including the Acorn carbon capture project off the north east coast of Scotland. The Acorn project is designed to capture CO2 in the St Fergus area for subsequent transportation and injection into a depleted gas reservoir. Subject to funding and consents, the Acorn pilot project will come on stream in the early part of the next decade and over time has the potential to store up to 3 million metric tonnes of CO2 per year.

With the UK currently emitting close to 450 million metric tonnes of greenhouse gasses annually and the UK’s offshore oil and gas sector representing around 3% of these emissions, the industry would probably need the equivalent of around five Acorn-look projects to become a net zero basin. However, to deliver this outcome, it will need the support of governments, policy makers, regulators and others, to make the technologies and business models for carbon capture utilisation and storage economically viable.

Although there are increasingly loud and influential voices arguing that the best way to deliver the ‘net zero agenda’ is by shutting down the oil and gas industry with immediate effect, we must demand a more informed debate. It is becoming increasingly clear that there is a shared destination among the UK and devolved governments, policy makers, industry and many others in terms of delivering the net zero outcome.

At Offshore Europe in September 2019, OGUK will launch Roadmap 2035 together with its updated Economic Report. The roadmap will set out how the industry is and can contribute to the net zero agenda in the context of the requirement for energy security and energy sovereignty.

Roadmap 2035 will provide a constructive framework to facilitate discussion and sharing of best practices to deliver this shared destination. However, it will require the careful balancing of societal expectations with the UK’s ability to adjust to the far-reaching changes required to meet the net zero targets. Societal acceptance of the rate of this change will be key to how fast the UK and the UK’s energy sector will have to move to deliver on net zero.

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