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 The move is a shrewd one for an industry that has been on the
defensive for years on climate issues, constantly fending off
attacks that its products have contributed to an unhealthy rise in
global temperatures.
While the landmark emissions-reduction agreement among 195 countries
late last year was seen as a defeat for fossil fuel producers,
executives and oil ministers sounded a clarion call this week at
their first major meeting since the Paris talks for more research
into how carbon capture technology can be cheapened and perfected.
The hope is that this and other technologies could sharply cut oil
and natural gas emissions, protect the industry from the
ramifications of climate change legislation and ensure developing
economies still have access to inexpensive energy.
"If you could eliminate all of the carbon dioxide from fossil fuel
combustion, then you could use those fuels as long as you want,"
Robert Armstrong, director of the MIT Energy Initiative, said in an
interview on the sidelines of IHS CERAWeek, the world's largest
gathering of oil executives.
"It's just a matter of making those technologies competitive in the
market."
That could help the oil industry avoid the worst-case scenario for a
post-Paris world: governments forcing oil and gas production to
cease in certain areas.
Ali Al-Naimi, Saudi Arabia's oil minister, called climate change a
greater challenge for his industry than even crude price <CLc1>
gyrations.
Naimi, who attended the Paris meetings, said his nation - the
Organization of the Petroleum Exporting Countries' de facto leader -
is committed to finding technological solutions to slash emissions.
"We recognize the threat posed by climate change," he said. "We and
many others have invested time, money and brain power into seeking
technological solutions to the challenges posed by climate change,
in particular with carbon capture."
Ryan Lance, chief executive of ConocoPhillips <COP.N>, spoke about
the impact of climate change in Alaska, where his company is the
largest oil producer. "I've seen the glaciers melting," he said.
John Hess, CEO of Hess Corp, North Dakota's third-largest oil
producer, called climate change a "serious problem."
"The world needs more energy, but it needs less CO2. We think we can
get there," Hess said in an interview.
Many expressed confidence the industry's scientists - who perfected
horizontal drilling and fracking that reinvented the industry -
could find ways to prevent more carbon from polluting the
atmosphere.
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Their comments starkly contrasted with how some members of the
industry for years questioned the reality of climate change. A
couple of energy companies have faced inquiries over their climate
change disclosures.
The Paris deal, which must still be ratified, aims to limit the rise
in global temperatures to "well below" 2 degrees Celsius (3.6
degrees Fahrenheit), a level scientists see as a tipping point.
Until now, the line was drawn only at 2 degrees.
Oil companies have pulled off technological surprises before. An
Exxon Mobil Corp engineer invented the lithium ion rechargeable
battery in 1975 amidst widespread concern oil supplies would run
out. While that battery failed to immediately take off, it is now
used by Tesla Motors Inc to power its electric cars.
In an unusual twist, JB Straubel, Tesla's chief technical officer,
gave a keynote speech at the event.
'FORCE FOR GOOD'
Naimi insisted the oil industry was a "force for good," providing
fuels for economic growth in developing nations.
"We should not be apologizing, and we should not ignore the
misguided campaign to keep it in the ground," the Saudi minister
said.
Industry leaders say it is hypocritical for societies to continue to
use products derived from fossil fuels while demanding an end to oil
and gas extraction.
"It's a bit Pollyannish to say that we can move away from the carbon
age and still have rising expectations for living standards," said
Mark Papa, CEO of Silver Run Acquisition Corp.
For John Brown, the executive chairman of L1 Energy and the former
CEO of BP PLC, climate change is also a life-or-death issue for the
oil industry.
"To have a seat at the table and shape the future is, I believe,
vital," Brown said. "We do need a planet upon which to conduct
future oil and gas activity."
(Reporting by Ernest Scheyder; Editing by Terry Wade and Marguerita
Choy)
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