Exxon, Shell, BP Join Forces to Cut Emissions From Natural Gas - 2nd Update
November 22 2017 - 4:10PM
Dow Jones News
By Sarah Kent and Bradley Olson
LONDON -- Exxon Mobil Corp. has joined with seven other big
energy companies to reduce pollution from natural gas production,
an effort by the industry to present itself as part of the solution
as governments and consumers demand more environmentally friendly
energy.
Big oil companies like Exxon and Royal Dutch Shell PLC have
increasingly touted natural gas as a core tool to combat climate
change, since it is produces fewer greenhouse gas emissions than
the fuel it often replaces in electricity production, coal.
The rare trans-Atlantic alignment was first reported by The Wall
Street Journal, ahead of the companies' announcement Wednesday. The
collaboration by companies including Exxon, Shell, BP PLC and Total
SA, shows the oil and gas sector is proactively trying to address
burgeoning concerns about natural gas emissions to ensure that its
big bet on the fossil fuel pays off.
Major energy companies have made big investments in gas in
recent years and are steadily growing their production volumes.
They argue that it will prove a vital source of energy stability
even as renewables increase their market share, since gas can be
burned when the sun isn't shining or the wind isn't blowing.
But methane, the main component in natural gas, is also a potent
greenhouse gas and the issue of fugitive emissions that occur when
it leaks into the atmosphere is starting to draw negative
attention.
Exxon and its partners said Wednesday that they have signed up
to a set of guiding principles, committing to drive down methane
emissions from their assets, encourage better performance from
their peers, improve transparency and data accuracy on the matter
and advocate for better regulation.
"The commitment was made as part of wider efforts by the global
energy industry to ensure that natural gas continues to play a
critical role in helping meet future energy," the companies said in
a joint statement. "Its role in the transition to a low-carbon
future will be influenced by the extent to which methane emissions
are reduced."
A recent International Energy Agency study found around 76
million tons of methane are emitted every year from global oil and
gas operations. That is the equivalent to more than Australia's
entire natural gas production, the IEA's executive director, Fatih
Birol told an industry gathering last month.
The companies set of principles was developed in collaboration
with the IEA, the United Nations and other international
organizations focused on energy and climate change.
Exxon's decision to join the group leaves Chevron Corp. as the
only major U.S. oil company that has yet to join the initiative.
Both the U.S. oil companies have lagged behind their European peers
on the issue of climate and Exxon hasn't participated in previous
similar efforts to build an industry voice on such subjects.
Over the years, activists have pointed to the lack of
participation by Exxon and Chevron in the group climate effort as
evidence of a divide between the biggest U.S. and European oil
companies on the issue.
Still, under pressure from investors over the past year, they
have both undergone an evolution in the way they address climate
change publicly. Chevron has provided more information about how it
is looking at climate risks and made strides in its own methane
reduction efforts. "It is in Chevron's business interest to
minimize fugitive methane and to maximize the volume of natural gas
that we can commercialize," the company said in an emailed
statement.
Exxon Chief Executive Darren Woods has urged President Donald
Trump not to withdraw from the Paris climate accord. The company
has also initiated research efforts to test the viability of
capturing emissions from natural gas power plant operations, as
well as continued to study ways to convert algae into fuel.
Write to Sarah Kent at sarah.kent@wsj.com and Bradley Olson at
Bradley.Olson@wsj.com
(END) Dow Jones Newswires
November 22, 2017 15:55 ET (20:55 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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