US supermajor Chevron has accelerated its efforts in the energy transition with the launch of a new business focused on scalable, low carbon business opportunities, but this will not include large scale wind or solar projects.
On 1 August Jeff Gustavson was named president of Chevron New Energies, which centres on commercialising hydrogen, carbon capture and storage (CCS), and offsets, as well as supporting growth in biofuels.
“Chevron New Energies reflects our higher returns, lower carbon strategy,” said Michael Wirth, Chevron chief executive.
One thing we're not doing in lower-carbon is large scale wind and solar
Chevron chief financial officer Pierre Breber
“We believe the dedication of resources in a new organisation will accelerate growth in multiple business lines that we expect to be part of a lower carbon energy system.”
Additional information about the new organisation will be provided on a 14 September investor presentation, although the company discussed its energy transition efforts during its earnings call on Friday.
Chief financial officer Pierre Breber said there are two parts to Chevron’s lower-carbon activities, the first being to lower the carbon intensity of its operations, the second being to advance lower-carbon businesses, as seen with Chevron New Energies.
He said the new organisation is primarily focused on hydrogen and CCS at the moment, but Chevron has also worked with renewable fuels like renewable natural gas and renewable diesel.
“What we are trying to do around lower-carbon really is connected to our assets, capabilities, and customers. So one thing we're not doing in lower-carbon is large scale wind and solar,” Breber said. “That's a decision that we're making because we don't feel like we have the competitive advantage.”
“But when we get to renewable fuels, like renewable natural gas, renewable diesel, sustainable jet, hydrogen, carbon capture, these are areas that are adjacent to our business where, again, we have capability, we have customers, and we have assets that we can leverage.”
ExxonMobil gives CCS update
ExxonMobil, which launched its own Low Carbon Solutions business in February, spoke on its progress in the energy transition during its earnings call on Friday as well.
Chief executive officer Darren Woods said the company is making steady progress in developing opportunities, specifically in CCS.
Woods said its massive CCS hub concept in the Houston Ship Channel and other Gulf Coast opportunities are gaining industry and third-party support.
He also highlighted several recently announced CCS projects, including the decarbonisation of an industrial basin in the Normandy region of France, a collaboration with an Acorn CCS project in Scotland.
It is also planning to take a final investment decision next year at its LaBarge facility in Wyoming, as well as a new carbon capture technology pilot associated with the Porthos project in Rotterdam.
The Porthos project will see about 2.5 million tonnes per annum of carbon dioxide from industry in the Port of Rotterdam stored in depleted reservoirs at a gas field in the North Sea.