Blah, blah, blah

According to Upstream Online:

A climate strategy is needed, and quickly

It is?

The topic under discussion is the Oil & Gas Climate Initiative, which I wrote about here.

This is not all “blah, blah, blah,” argued Repsol chief executive Josu Jon Imaz San Miguel when talking in Paris last week about an oil industry initiative to help tackle climate change.

No?  We shall see.

The Spaniard was one of the oil and gas industry leaders who stuck their heads above the parapet ahead of the United Nations climate talks looming in December.

Imaz was rightly anticipating that any message from Repsol, Shell and others would be dismissed as idle talk by environmentalists.

Now why would he anticipate that if there was something there other than “blah, blah, blah”?

But now a total of 10 companies, including Saudi Aramco and Total, have signed a joint statement promising to reduce their own carbon emissions.

Which they promised to do years ago.  There’s a whole section devoted to reducing emissions on the Total website, and it didn’t get put up last week.

The statement was short on detail

One could almost say, thus far, it was a load of “blah, blah, blah”.

but insisted the signatories would promote gas over coal

That’s because they are oil and gas companies, with minor interests in coal.  It would be like Pizza Hut promoting pizzas over fish in the interests of saving the Atlantic cod.

while ending routine gas flaring.

Which, in the case of Total, they committed to do in November 2014 as part of the World Bank and the Climate and Clean Air Coalition.  Maybe they were just kidding back then?

It also vowed to play a bigger role in renewables and invest in carbon capture and storage (CCS).

As I said before, who’s to say oil companies will be any good at developing renewable energy?  They don’t seem to be very good at producing oil and gas unless the market price is at an all-time high, maybe they should concentrate on that for a while?

This is all part of the Oil & Gas Climate Initiative (OGCI) where companies are trying to tackle the vexed issue of carbon emissions.

And tens of thousands of politicians, academics, eco-loons, hippies, and other hangers-on are busy trying to line their own pockets and/or impose their own system of government on a reluctant global citizenry.

And without a promise to be part of the solution rather than the problem, the oil and gas industry risks being left outside the negotiating room.

The victims of a protection racket are rarely permitted to negotiate the sums demanded each week.

That — in theory — could mean awkward if not draconian regulations introduced by the fossil fuel critics at the UN talks.

Which would send the oil price through the roof.  I can see why the global population might object, but why the oil companies?  They’ll just pass the costs on.

But the OGCI presentation and press conference in Paris last Friday did have its limitations.

You don’t say.

Where was the campaigning for a sensible carbon price, a demand made earlier by some members of the Initiative?

The sensible price is $0.

There is clearly no agreement on this critical issue

Unusual, for an international congress on climate change.

and to make matters worse there was no representation from US heavyweights such as ExxonMobil and Chevron.

Now why might that be?

Exxon chief executive Rex Tillerson has previously stated he has no intention of “faking it” on climate issues.

Presumably he means he is going to concentrate on producing oil and gas, the raison d’être for his company, and is not going to hang his head in shame for doing so in the manner some people clearly want him to.

You have to admire his honesty

Why yes, you do.

and it is easy to see why he stayed away.

Yes, yes it is.

But is this kind of stance in the long-term interest of ExxonMobil shareholders?

Concentrating on producing oil and gas instead of being sucked into empty talking shops and “negotiations” with people who hate you but appreciate you are sitting on a hefty pile of cash that they would dearly love to get their paws on?  That’s a tough one.

Certainly some of them do not agree with management, judging by the motions submitted at annual general meetings calling for more robust action to be taken to tackle global warming.

You mean this one:

Chevron and Exxon Mobil have rejected calls to stop investing in high cost, high carbon oil projects and return money to shareholders.

Only 4% of Chevron investors voted for the proposal at its AGM on Wednesday.

Ahead of the meeting, Chevron’s board told shareholders the proposal was “based on a flawed, if not dangerous, premise: that stockholders would be best served if Chevron stopped investing in its business”.

Which is kinda hard to argue with.

Meanwhile, Exxon had blocked the matter from going to a vote.

Exxon executives did hear an appeal from Catholic friar Mike Crosby to appoint a climate change expert to its board, however.

Chief executive Rex Tillerson uttered “not one word about climate change” in his opening remarks, Crosby observed. “Silence speaks volumes on this”.

A Catholic friar?! What does he know about the oil and gas industry?  Does ExxonMobil get to appeal when the Catholic church responds to allegations of kiddy-fiddling with a deafening silence?

Back to the first article.

And with an increasingly wide coalition of policy makers calling for fossil fuels to be left in the ground, this is not a time to hide.

Who’s hiding?  Hasn’t ExxonMobil made it perfectly clear why it is not buying into this bullshit?

Refusing to engage with wider stakeholders around global warming risks being saddled with the pariah status afforded the tobacco companies.

Which will involve what?  Swingeing fines?  Class action lawsuits?  And where do you think the incidence of these penalties will fall?  They’ll just be added to the costs of the energy which, according to the same clowns who are behind this extortion racket, needs to be made more readily available to the world’s poor.  Nobody cared when smokers got gouged, and later treated like paedophiles caught snooping around a playground.  Smokers can give up.  Are people going to give up consuming fossil fuel products, and pay more for their energy, because a handful of politicians and lawyers have taken their cut?

If the industry is to win the argument that oil and gas have a vital part to play in any move to a lower carbon economy then public engagement is key.

Perhaps.  If the public engagement consists of producing oil and gas as cleanly and efficiently as possible, then yes.  But if it involves subcontracting part or all of the company strategy to a bunch of self-serving and largely clueless outsiders who have no stake in the company fortunes, then no.

But even inside the position of the Oil & Gas Climate Initiative there are unsettling contradictions.

It’s the oil industry.  There are unsettling contradictions in an oil company’s stationery guidelines.

The fact is that most oil companies are like Shell and BP, which have largely reversed out of renewables after a brief flirtation.

Now why would that be?  Over to you, Rex:

Asked why Exxon was not investing in renewable energy, he implied the sector was not profitable: “We choose not to lose money on purpose.”

How unreasonable.

Back to the first article.

Apart from the odd individual project by Statoil and Shell, there has been little attempt to back claims that CCS technology can help tackle future fossil fuel emissions on a grand scale.

A look at BP’s experience in this area back in 2007 might explain why:

The UK’s only carbon storage project has just been axed by BP, which says the government reneged on key support for it.

BP and its partners had planned to extract carbon dioxide from natural gas used in a power station to be built at Peterhead then pump it under the North Sea into its Miller oil field. Production there is due to come to an end this year, but by forcing in carbon dioxide, extra oil reserves could be squeezed out. More importantly, two million tonnes of carbon dioxide a year could be pumped down there and stored for 10,000 years.

By spring, BP had spent £50m on the £500m project. Then the government decided that all carbon storage schemes had to compete for funding and tax relief, the winner to be picked around 2010. The reasoning behind this pronouncement is unclear, but the effect was immediate. Asked to maintain pumps, pipes and platforms for three years in a dead oil field, BP promptly dropped the Miller project and is now looking to the US and Australia to launch such schemes.

So the marginal investments of oil companies are sensitive to the whims of politicians?  Who knew?  Maybe, just maybe, that is why some believe that this new, overtly political initiative ought to be given a wide berth.

Back to the first article.

Equally, Shell’s drilling in the Arctic did nothing to promote the image of an oil and gas industry with a newfound sense of responsibility to the environment.

Maybe Shell was not interested in promoting its image when they sent the rig up there, and instead had the old-fashioned objective of finding new reserves of oil and gas which – up until recently – the Peak Oilers were telling us were essential to avoid Armageddon.

BG chief executive Helge Lund, Amin Nasser of Saudi Aramco and the others deserve praise for stepping up on behalf of oil and gas.

They’re stepping up because they believe it is in the interests of their shareholders (that’s the charitable version, anyway).  They do not speak for the entire industry, as the absence of ExxonMobil and Chevron attest.

But the industry needs to try to pull together more and take action to meet any promises.

Or they could refrain from making any promises before it has pulled together.

None of that comes easily or cheaply.

No.  But token gestures do.  What was that Spanish chap saying about “blah, blah, blah”, again?

The OGCI’s action plan failed to excite attendees.


2 Responses to Blah, blah, blah

  1. Graeme says:

    The worry is when supposedly clever people such as Mark Carney buy into the “leave it in the ground”, “Stranded assets” bullshit. Leave it to the market…do not try to tell them what to do because you will always end up on the wrong side of history. I am reminded of the BP chap who told everyone that the Mexico rig disaster would not be disastrous…. it was a disaster for him personally, but despite Obama’s best efforts, the ecology of the Gulf of Mexico is back to normal.

    Fact…the world is too complex for mere humans to understand and control.

  2. Graeme says:

    I should have added that it was also a disaster for the unfortunate people who died on the platform. Mea culpa.