The oil and gas industry might lose the social license to operate, and if it doesn't act quickly on helping solve the climate change problem, there may be no second chance.
Tim Eggar, the Chairman of the UK Oil and Gas Authority (OGA) addressed a group of senior industry leaders at a meeting of the MER UK Steering Group in Aberdeen on Wednesday, where he called on the industry to act much faster and go farther in reducing its carbon footprint.
He said that the license to operate for the industry has changed fundamentally in the past few years, and "-unlike the oil price - forever," citing the increasing speed of the shift in public and industry opinion on climate change
"Clearly, climate change is happening right now. That debate is over," Eggar said. He added. "If the industry wants to survive and contribute to the energy transition it has to adapt."
He called for the offshore industry to commit to clear measurable greenhouse gas targets, with real progress on methane, to show progress on carbon capture and storage, including work having started on major projects. Also, he called for measurable progress on energy integration opportunities – for example, an electrification project.
"Public opinion on climate change, and the Government’s legally-binding commitment to net zero emissions by 2050 (2045 in Scotland), means that we have to do everything we can to contribute to achieving this. That applies to the OGA, and to every oil and gas operating and service company," Eggar said.
"There are already some good examples of companies taking the initiative. Some of you have been setting carbon reduction targets from operations and putting in place programs to reduce flaring and venting and increase efficiency. There has also been good early work on carbon capture –Teeside, Acorn, and Liverpool Bay are just three examples.
"Yet listen or read much of the social media and popular press and our industry is part of the problem not part of the solution. Industry’s license to operate is under serious threat. Industry is not even really in the argument never mind winning it."
"It is, in my opinion, collectively not doing enough and its social license to operate is under serious threat. There has been too much navel-gazing. We have to act much, much faster and go farther in reducing the carbon footprint. Our energy systems must keep improving at pace, to become cleaner and more efficient and this requires ambitious thinking, capital investment, and bold leadership. Action not just talk or more analysis."
"The oil and gas industry should be the leader in developing some of the solutions to tackling climate change, rather than continuously being seen as the problem or the blocker," Eggar said.