Oil and gas companies invest in their (green) future

The past year was a perfect storm for offshore oil and gas companies. Market conditions fluctuated, with reduced demand for crude oil and a sharp decline in oil prices. Financial institutions are actively and visibly shying away from investing in carbon-heavy projects, pushed by new legislation^[1]. Social expectations continued to change, with over two-thirds of the global population considering climate change a global emergency^[2] and demanding action from companies.

This confluence of factors set the stage for offshore oil and gas companies to rethink their long-term business strategies. For many, this has meant developing their renewable energy activities, investing heavily in the sector and leading the charge towards developing the low-carbon barrel.

What European oil majors are promising

Several major offshore oil and gas companies have made substantial investments in renewable energies, and are targeting net zero emissions within the next few decades.

• Total has pledged to increase its annual investment in renewable energies to $3 billion USD by 2030, and is aiming to become net zero by 2050^[3]
• BP plans to increase its investment in low-carbon energy to $5 billion USD by 2030, and is aiming to achieve net zero by 2050^[4]
• Shell plans to spend $3 billion USD per year on its renewable energies division^[5] until 2025, and is aiming to become net zero by 2050^[6]
• Equinor expects to invest $10 billion USD in renewables by 2025^[7], and has pledged to achieve net zero emissions by 2050^[8]

More than just investments

The vast sums being invested in renewables are laying the groundwork for the development of company-wide strategies for making the transition from “oil major” to “energy provider.” While oil will remain part of the energy mix, offshore companies will need to shift to green production methods, while simultaneously increasing alternative energy output.

To do this, oil and gas companies must begin to assess the full scope of their activities, both internally and across the supply chain. By having a thorough and well-documented understanding of their environmental impact, offshore oil and gas companies can target areas for improvement and diversify their energy portfolio.

To support offshore producers and service companies up and down the supply chain in making this transition, Bureau Veritas Marine & Offshore is working closely with our colleagues across BV sectors. By collaborating with Bureau Veritas Certification, Bureau Veritas Industry & Facilities and BV Solutions M&O, we can achieve best practice across industries and take a holistic approach.

We draw on experience from across all sectors within the Group, with a core of expertise for offshore and onshore oil and gas complemented by a range of other services. These include energy and carbon management, technical solutions for complying with GHG protocols, ESG criteria and regulatory auditing, assurance and reporting, and minimizing CAPEX and OPEX.

Like our clients, Bureau Veritas takes an end-to-end approach to the energy transition, providing services for the full supply chain and creating a complete ecosystem for managing and minimizing environmental impact.

^[1] https://ec.europa.eu/info/sites/info/files/business_economy_euro/banking_and_finance/documents/200309-sustainable-finance-teg-final-report-taxonomy_en.pdf
^[2] https://news.un.org/en/story/2021/01/1083062
^[3] https://www.edie.net
^[4] https://www.nytimes.com/2020/08/04/business/energy-environment/bp-renewable-investment.html
^[5] https://www.theguardian.com/business/2020/jan/03/royal-dutch-shell-may-fail-to-reach-green-energy-targets
^[6] https://www.reuters.com/article/shell-emissions/update-3-shell-sets-emission-ambition-of-net-zero-by-2050-with-customer-help-idUKL5N2C417D
^[7] https://energynow.tt/blog/equinor-leads-investment-in-renewables
^[8] https://www.equinor.com/en/news/20201102-emissions.html