Energy Transition

Our plan to tackle climate change through industry decarbonization

Energy Transition

Tackling climate change with IOGP Energy Transition programme

The Challenge: a low carbon future

Tackling climate change while meeting global energy demand is one of the greatest challenges of our lifetime.

Everyone – the industry, governments, and society – has a responsibility to help achieve the Paris Agreement goals.

As society moves towards a low carbon future, our industry will still be responsible for meeting the planet’s basic energy needs and creating a world where everyone has access to clean, reliable, and affordable energy.

Strategic direction and key approach

Following our 2021 Strategic Review, IOGP is working to help the oil and gas industry accelerate the implementation of low carbon projects and operations and support the need for:

  • Standardization, rapid adoption, and repeatability to quickly implement low carbon projects and practices across the whole industry
  • Transformative lower carbon technologies for new and existing assets

Leveraging our key strengths and experience

For nearly 50 years, IOGP has brought the oil and gas industry together to standardize ways of working and define performance metrics in areas such as safety, environmental management, and health.

We are uniquely placed to drive collaboration across the industry to ensure we can learn and benefit from the knowledge of those at the forefront of these efforts. IOGP is leveraging its key strengths and experience to help tackle climate change through decarbonization. Our mission is the same one it’s always been: to bring industry together.

The Energy Transition Directorate works closely with other key Directorates, such as Safety, Environment, and Engineering, to deliver performance improvements within our Membership and the wider industry.

The road to Net Zero

The International Energy Agency publishes an annual report analysing the projected state of the world’s energy production and consumption in the medium and long-term future under several potential scenarios for global energy supply and demand.  In IEA’s Energy Outlook 2021, in all scenarios, oil and gas will play an important contribution towards energy demand for decades to come.

It is therefore vital that the oil and gas industry works to reduce emissions and helps the world reach the Paris Agreement objectives.

Throughout this transition, both oil and natural gas will retain an important role as affordable, reliable, and versatile energy products for a growing global population. The challenge is to address climate change through emissions reduction while also meeting global energy demand and supporting economic development in the long term.

To reach Net Zero, our focus will be on the decarbonization of our Members’ own operations, pursuing a systematic decarbonization pathway starting with a significant reduction of Scope 1 emissions.

  • By 2025, we will target zero upstream flaring and a tangible reduction of Scope 1 emissions
  • By 2030, the focus will be Net Zero emissions for upstream, in Scope 1 and 2 emissions
  • 2040 and 2050 will see Net Zero absolute emissions for Scope 1, 2, and 3.
Total primary energy supply by fuel and scenario, data from IEA Energy Outlook 2021

Systematic decarbonization pathway

Measuring emissions

In order to manage emissions, we first need to measure them. Greenhouse gas (GHG) emissions can be categorized as Scope 1, 2, or 3.

  • Scope 1 covers direct emissions, such as those from facilities and equipment directly owned by a company
  • Scope 2 covers indirect emissions from the generation of energy purchased by the reporting company
  • Scope 3 includes all other indirect emissions that occur in a company’s value chain. These are .emissions that result from a company’s activities, such as emissions created when consumers use the company’s products

Focus on Scope 1 emissions:

Breakdown of Scope 1 greenhouse gas emissions from oil and gas facilities

50 - 70%

Stationary Combustion

15 - 30%

Flaring

5 - 20%

Venting

5 - 15%

Fugitive emissions

The Energy Transition Directorate will focus on Scope 1 greenhouse gas emissions until 2025. Our industry emissions can be broken down as follows:

  • 50 – 70% Stationary combustion
    • Stationary combustion is associated with flue gas (from power and heat gas turbines boilers and furnaces)
  • 15 – 30% flaring
  • 5 – 20% venting
  • 5 – 15% fugitive emissions

Our strategy addresses each of these areas.

The four Energy Transition topics are:

  1. Electrification
  2. Carbon Capture Transportation and Storage
  3. Minimization of all flaring and venting activities
  4. Best available technology in energy efficiency

These topics were chosen following an Opportunity Framing Workshop – a rigorous 9-month process involving the participation of over 150 subject matter experts. We will deliver recommended practices,  technologies catalogues, and technical guidance to support standardization across the oil and gas industry.

Governance

The Energy Directorate is supported by two Committees

Carbon Capture, Transportation, and Storage Committee

The Carbon Capture, Transportation, and Storage Committee will focus on accelerating the standardization of CCS to improve its cost, scheduling, and safety, thus enabling widespread implementation of CCS. It will collaborate with other associations working on climate change, as well as with international and regional regulators and standards organizations.

Low Carbon Operational Efficiency Committee

The Low Carbon Operational Efficiency Committee will focus on decreasing CO2 emissions and methane intensity in upstream operations. It will coordinate its efforts with global industry groups including the Oil and Gas Climate Initiative (OGCI), Ipieca, the American Petroleum Institute (API), the Energy Institute, the Methane Guiding Principles, and the Global Gas Flaring Reduction Partnership (GGFR).

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