TOT TOTAL SE

By Maitane Sardon

French oil major Total SA said Tuesday that it will aim to achieve net-zero emissions by 2050 after engaging with a group of institutional investors with more than $40 trillion in assets.

The move comes as the oil-and-gas sector faces pressure from investors to tackle climate change and shift away from hydrocarbons amid a historic meltdown in oil prices. Fossil-fuel companies in Europe are also looking to align their strategies with the European Union's ambition to become carbon neutral by 2050, as governments ready regulations to punish big polluters.

Total said it aims to achieve net-zero emissions from its operations world-wide and from the energy products it sells in Europe by 2050. The company is also targeting a 60% reduction in the carbon intensity of its products to less than 27.5 grams of carbon dioxide per megajoule.

"Energy markets are changing, driven by climate change, technology and societal expectations," Chairman and Chief Executive Patrick Pouyanné said. "As the EU has set the target to achieve net-zero emissions by 2050 and thereby lead the way for other regions to become carbon neutral over time, Total takes that commitment to become neutral for all its businesses in Europe."

The company also said it will assess its oil-and-gas capex allocation to make sure it is consistent with the Paris Agreement and will advocate for policies that support achieving net-zero emissions.

Climate Action 100+, the group of investors behind the engagement, welcomed Total's announcement, which it said is the result of many years of dialogue with the company.

"This agreement is one of the most significant achievements in the oil-and-gas industry so far," said Helena Vines Fiestas, global head of stewardship and policy at BNP Paribas Asset Management. "The global energy system is under significant structural pressure from long-term forces such as decarbonization and the deflationary impact of renewables... Total's commitment shows that it understands the scale of this challenge."

Total's pledge is the latest in a series of commitments made by European oil majors.

In April, Royal Dutch Shell PLC set more ambitious emissions goals, including reducing the carbon footprint of the fuel it sells by 30% by 2035 and 65% by 2050.

In March, British oil-and-gas company BP PLC agreed to draft a shareholder resolution to be voted on next year that would enshrine its pledge to reach carbon neutrality by 2050.

Norwegian energy major Equinor ASA in February announced new climate goals, including reaching carbon neutrality from its operations by 2030, boosting renewable energy tenfold by 2026 and cutting its carbon intensity by at least half by 2050.

Write to Maitane Sardon at maitane.sardon@wsj.com

(END) Dow Jones Newswires

May 05, 2020 05:58 ET (09:58 GMT)

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