Exclusive: Oil majors
join forces in climate push with renewable energy fund
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[November 02, 2016]
By Ron Bousso
LONDON
(Reuters) - Top oil companies including Saudi Aramco and Shell are
joining forces to create an investment fund to develop technologies to
promote renewable energy, as they seek an active role in the fight
against global warming, sources said.
The chief executives of seven oil and gas companies -- BP, Eni, Repsol,
Saudi Aramco, Royal Dutch Shell, Statoil and Total -- will announce
details of the fund and other steps to reduce greenhouse gases in London
on Friday.
The sector faces mounting pressure to take an active role in the fight
against global warming, and Friday's event will coincide with the formal
entry into force of the 2015 Paris Agreement to phase out man-made
greenhouse gases in the second half of the century.
The group is part of the Oil and Gas Climate Initiative (OGCI), which
was created with the backing of the United Nations in 2014 and includes
11 companies representing 20 percent of global oil and gas production.
The company leaders are expected to detail plans to create an investment
vehicle that will focus on developing technologies to lower emissions
and increase car engine and fuel efficiency, according to the sources
involved in the talks who declined to be named.
The size and structure of the fund were unclear.
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The fund will also focus on ways to reduce costs of carbon capture and
storage (CCS) technology, which involves capturing carbon dioxide
emissions produced from fossil fuel burning plants and re-injecting them
into underground caverns.
OGCI, Shell, Total and BP declined to comment.
The CEOs are also expected to announce the next phase of their plan to
reduce the oil sector's emissions, primarily by reducing flaring of
excess gas at fields, increasing the use of CCS and limiting the release
of methane, a highly polluting gas often emitted through pipe leaks.
OGCI leaders called on governments last year to set a price on carbon
emissions to encourage the use of cleaner technologies, although some
companies including Exxon Mobil have resisted the idea.
They now hope to show they can play an active role.
The drive to limit global warming to 1.5 degrees Celsius by the end of
the century poses a threat to oil and gas companies as transport and
power sectors gradually shift towards renewable sources of energy such
as solar and wind.
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![](../images/110216PICS/busine61.jpg)
French oil and gas company Total Chief Executive Officer Patrick
Pouyanne attends a session of the St. Petersburg International
Economic Forum 2016 (SPIEF 2016) in St. Petersburg, Russia June 16,
2016. REUTERS/Valery Sharifulin/TASS/Host Photo Agency/Pool
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Oil majors including Norway's Statoil, France's Total and Italy's Eni,
have increased their investments in renewable energy in recent years,
although it is still dwarfed by the main fossil fuel business.
Oil producers have also lobbied for the phasing out of coal in favor of
the less pollutant natural gas in the power sector.
Total CEO Patrick Pouyanne said last month that OGCI leaders will
announce plans "to work collectively to develop technologies which will
be needed to face climate change issues."
Delegates from signatory nations meet in the Moroccan city of Marrakesh
on Nov. 7-18 to start turning their many promises into action and draw
up a "rule book" for the sometimes fuzzily worded Paris Agreement on
climate change, reached last December.
(Reporting by Ron Bousso; Editing by Susan Fenton)
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