Offshore energy industry transition to meet the UK’s 2050 net-zero target

Were you there when the offshore industry was told it was at risk of losing its social license, with its very survival at stake? Shockwaves reverberated through the audience in Aberdeen when the Oil and Gas Authority (OGA) Chair Tim Eggar warned there was no scope for a second chance, “the debate (over climate change) is over” and it must embrace energy transition.

The big warning delivered, OGA has now published a report which pivots from the doom and projects optimism instead. Through the integration of integrating offshore energy systems including oil and gas, renewables, hydrogen, and carbon capture and storage, it says 30% of the UK’s total carbon reduction target for 2050 net-zero would be delivered.

And that’s not including all the potential of offshore renewables. Including this – the green energy from wind, wave, and tidal –  you could add an extra 30% – so a total of 60% of what we need to meet our 2050 net-zero target. Now, that’s a phenomenal piece of news, and honestly – who doesn’t need something outstanding right now?

“Net-zero fever” is now a thing in the O&G world. The first company in this sector to pledge to be net-zero themselves was Repsol, in December last year. At the same time, it set itself a decarbonisation plan with targets for 2020 – 2040. It’s banking on being able to deliver 70% of the ambition through ‘technology that can currently be foreseen’ underlying the importance of new developments to get it across the line.

Eni, Shell, Total and BP have all now made similar pronouncements but it’s important that publicly stated ambitions deliver more than a few good headlines – because people are watching. Transition Pathway Initiative, an investor initiative backed by over $19trn of global capital, said none of these companies are aligned with the 1.5C pathway of the Paris Agreement or the net-zero movement.

Acknowledging the huge shift in attitude to get to this point, Adam Matthews, co-chair and Director of Ethics and Engagement for the Church of England Pensions Board highlighted that three years ago no company had any targets to reduce the carbon intensity of the energy they supplied. However, he added: “TPI’s analysis underlines that these commitments are not all equal in ambition or in scope and deeper decarbonisation is needed to align with a 1.5°C or even a 2°C scenario. Shell and Eni are leaders and Shell has introduced a new concept of not selling energy to customers that are not also aligned to net-zero pathways in key sectors such as aviation, shipping, and freight.  This warrants further analysis to quantify the emissions reductions of such an approach.”

Other approaches outlined by the OGA include:

• Electrification of O&G platforms – which could reduce emissions by 40% by 2030
• O&G capabilities can potentially support an offshore renewable expansion
• Support carbon capture by reusing oil and gas reservoirs and infrastructure

OGA CE Andy Samuel commented: “By closely co-ordinating our energy systems a secure energy supply can continue to be delivered from a diverse mix of production while unlocking more and more of the green energy and carbon capture needed to help take the UK to net-zero”.