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The oil industry’s drive to show investors and the world that the sector is taking climate change seriously has reached the largest Russian oil producer, state-controlled Rosneft, which has just pledged to invest US$5 billion in environmentally-friendly projects within the next half decade.
Rosneft will invest in projects to curb carbon dioxide (CO2) emissions and for better utilization of associated petroleum gas, Reuters quoted Rosneft as saying on Monday.
The Russian oil firm will also look to reduce its greenhouse gas (GHG) emissions by 8 million tons through 2022, according to Reuters.
Rosneft’s commitment to invest in reducing carbon emissions comes days after UK-based supermajor BP, which holds nearly 20 percent in the Russian oil giant, announced plans to become a net zero company by 2050 or sooner.
Last week, BP said that it aims to become a net zero company by 2050 or sooner in the latest pledge for net zero carbon emissions by an oil major. BP will also target to halve the carbon intensity of the products it sells by 2050 or sooner, joining other majors such as Shell and Equinor, which also aim to reduce the carbon footprint of the energy products they sell.
Earlier this month, Equinor unveiled a plan to reduce the net carbon intensity, from initial production to final consumption, of energy produced by at least 50 percent by 2050. Shell has also set short-term targets for reducing the net carbon footprint of the energy products it sells.
In Russia, Ruslan Edelgeriev, the senior adviser on climate change to President Vladimir Putin, said earlier this month that Russia needs to take urgent steps to fight climate change and reduce its dependence on fossil fuels. Russia—the world’s fourth-largest greenhouse gas emitter after China, the U.S., and India—reduced the use of oil and coal in its energy mix by 4 percent between 2015 and 2018, while the share of natural gas has increased by 3.5 percent annually in each of those years, The Moscow Times quoted Edelgeriev as saying at a news conference in early February.
Russia has a recent plan to ‘adapt’ to climate change until 2022, but Putin said at his annual press conference in December that “nobody really knows the causes of climate change, at least global climate change.”
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.
Rosneft aims to reduce its greenhouse gas (GHG) emissions by 8 million tons through 2022. It has also joined the methane guiding principles and managed to drive its methane intensity down by 48% in 2018.
Rosneft’s total green investment over the past five years has exceeded 240 bn roubles (£2.9 bn) with its large-scale programme to reduce the flaring of associated gas to less than 5%. Moreover, the Carbon Disclosure Project , run by an independent non-government organization has assigned Rosneft a B rating, the highest among the participating Russian oil and gas companies. The rating is higher than the average of European companies.
Rosneft’s successes in human rights are no less significant. In November 2019, it was named the best Russian company in the international rating of Corporate Human Rights Benchmark (CHRB). CHRB raised the rating of Rosneft by 11 percentage points to 32.7%. This is one of the highest growth dynamics among all international mining companies including ExxonMobil and PetroChina according to Denis MacShane a former minister of state at the Foreign and Commonwealth Office (FCO) in London.
Dr Mamdouh G Salameh
International Oil Economist
Visiting Professor of Energy Economics at ESCP Europe Business School, London