Energy transition
CARBON EMISSIONS
Sizing carbon footprints The carbon emissions footprint, or CO2 intensity, of E&P companies varies significantly, reports Jon-Erik Remme, Product Manager Emissions Solution, Rystad Energy.
E
missions of CO2 from upstream players have become a key competitive metric in an industry in which capital, investors and, in some regions, a social licence to operate, hang in the balance. Indeed, the environmental ‘E’ in ESG is seen as a leading indicator of the robustness of exploration and production (E&P) companies in the face of the energy transition, and particularly in terms of direct emissions from sources that are owned or controlled by the operator – known as Scope 1 emissions. Rystad Energy analysed the upstream CO2 footprint from sources that are owned or controlled
by each of the E&P companies that published emission reporting for 2019, releasing the findings in November 2020. Their global CO2 intensity average (gross operated CO2 emissions divided by gross operated production) is calculated at about 17 kg/boe, but the estimate for all operators (including those that do not report) is 18–19 kg/boe. However, as shown in Figure 1a, the carbon emissions footprint varies significantly – ranging from less than 5 kg/boe to well above 100 kg/boe, although the vast majority of operators fall in the 10–40 kg/boe range. (Note: only CO2 is addressed, other greenhouse gases are not assessed here.) At field level, the variations in CO2 intensity are even higher, and the global transaction market has been rife with mature assets, typically with high carbon intensity. Figure 1a also illustrates the differences across supply segments. The operators are grouped here by
a
b
c
d
the dominant supply segment share of the company portfolio in 2019, and although this is a somewhat crude metric, some key observations can be made: •
Onshore producers are clustered in the upper half of the chart with higher carbon intensity, on average.
•
Offshore producers are scattered, some performing in the low emitter category, others in the highest.
•
Shale producers dominate the lower half of the chart, with a lower average CO2 intensity.
•
There are numerous outliers in each segment, underlining the need for an operator-byoperator (or even field-by-field) overview and analysis.
The variation across supply segments prompted a further
Figure 1*: Reported 2019 upstream CO2 intensity by a) operator type (in kg CO2/boe); b) operator offshore, c) shale operator and d) operator in conventional, onshore and oil sands (b, c and d in kg CO2/boe on x-axis and % flaring of upstream CO2 emissions on y-axis) *Chart only gives overview of operators that have published 2019 emissions number where it is possible to disaggregate upstream performance. Rystad covers 3,200 operators worldwide. Source: Rystad Energy
18 Petroleum Review | March 2021
