OPINION: We live in a time of unprecedented change. The climate is changing and society’s attitudes and expectations towards these issues are changing rapidly.
I share the concerns voiced by Greta Thunberg, David Attenborough, Mark Carney and others — I am deeply concerned about the future of our planet. Now is the time for real leadership and action.
I welcomed the Committee on Climate Change’s (CCC) Net Zero report and of course the government’s legally binding commitment to net zero emissions by 2050.
Very high on my priority list right now is working with governments and industry on the vital role this industry must play in the UK’s energy transition — both in driving to net zero carbon across the UK continental shelf as quickly as possible, and also in progressing the opportunities that overall net zero presents.
Of course, the drive to net zero doesn’t necessarily mean we stop needing oil and gas.
On the contrary, both the CCC report and official government forecasts show that oil and gas will remain an important part of our energy mix for the foreseeable future, even as we transition to net zero.
The CCC report modelled a consumption decline of 32% by 2050.
Over the same period, domestic production is forecast to decline by around 80%, meaning the UK is expected to remain a net importer.
Managing the declining production and maximising the economic recovery from the UK continental shelf is still vital to meet those energy demands as long as they exist, and to reduce reliance on hydrocarbon imports.
Our energy systems must keep improving at pace, to become cleaner and more efficient.
The UK’s rich history of oil and gas production, infrastructure and reservoirs, coupled with a world-class supply chain which is already diversifying into renewables, make it well-placed to be a global leader in the energy transition.
While we cannot and should not simply turn off the taps of our oil and gas assets and infrastructure tomorrow, more can be done to accelerate a just transition, while ensuring we have a diverse array of skills and people for the long term.
We are very focused on vital solutions such as carbon capture and storage (CCS), including re-using existing infrastructure.
CCS will be essential to achieving net zero and the government is strongly supportive.
We awarded our first CCS carbon dioxide appraisal and storage licence at the end of last year to Pale Blue Dot Energy for the Acorn CCS project and are supporting the government’s deployment pathway.
I believe maximising economic recovery of oil and gas does not need to be in conflict with the energy transition. They can and should be fully integrated.
In some instances, CO2 can also be used as a method of enhanced oil recovery and we aim to set out our approach to CO2 EOR in the near future.
Integrating various disciplines such as these may help realise greater efficiencies and help make them a reality.
For example, I’m very excited by the work the OGA is leading on to help unlock opportunities for deeper energy integration with renewables.
Our UKCS Energy Integration Project is looking at how infrastructure could be shared for mutual benefit.
For example: gas to wire may enable gas to be converted to electricity offshore and transported using existing wind farm networks; platform electrification could help reduce emissions on oil and gas installations by using electricity generated from nearby wind farms instead of diesel; offshore energy hubs can enable hydrogen to be generated offshore using wind farms and either stored in reservoirs or transported to shore using redundant oil and gas infrastructure; and natural gas produced offshore can be converted to hydrogen using steam methane reformation, with the CO2 by-product stored in reservoirs.
The possibilities are very exciting, particularly as we know the technology to enable these to happen is already there, and work is well under way to overcome the various commercial and economic aspects.
The oil and gas industry can be part of the solution to tackling climate change, rather than being seen as the problem.
I’m calling on industry now to step up, work together and lead the change. Industry’s social licence to operate is more crucial now than ever before.
Is industry doing enough to lower its carbon footprint? Is it doing enough to support new activities such as carbon capture and hydrogen?
These are vital if industry is to win hearts and minds, compete for talent and have access to capital.
Innovation is absolutely essential. The oil and gas industry has proved itself over many decades to be adaptable, resilient and able to solve problems.
This gives me confidence that substantial positive change is possible in these turbulent times.
Andy Samuel is the chief executive of UK regulator, the Oil & Gas Authority.