According to Carbon Tracker, oil and gas companies must cut combined production by more than a third by 2030 in order to keep emissions within the international climate targets.
In a recent report, Carbon Tracker has said that the major oil and gas companies need to significantly reduce emissions over the next two decades by an average of 40% by 2030 compared to 2019 levels in order to conform to the targets set in the Paris Climate Agreements.
According to the report, ExxonMobil and ConocoPhillips need to reduce their emissions at the fastest rate in order to stay within their carbon budgets, with ConocoPhillips needing to make cuts of 85%.
Shell’s portfolio is the most aligned with targets, but they will still need to make cuts of 10%.
The researchers note that the global reserves of fossil fuels still significantly exceed that which can be burned to stay within the Paris limits.
Carbon Tracker is an independent financial think tank that carries out an in-depth analysis of the impact of the energy transition on the capital markets.
Mike Coffin, oil and gas analyst at Carbon Tracker and author of the report, said: ‘If companies and governments attempt to develop all their oil and gas reserves, either the world will miss its climate targets or assets will become ‘stranded’ in the energy transition, or both.’
‘The industry is trying to have its cake and eat it – reassuring shareholders and appearing supportive of Paris, while still producing more fossil fuels.’
‘This report shows that if companies really want to both mitigate financial risk and be part of the climate solution, they must shrink production.’
Mark Campanale, founder and executive director, said: ‘Carbon Tracker has been consistent in showing that most fossil fuels must remain in the ground.’
‘Yet companies, and the governments that grant them their licenses are still intent on expansion.’
‘It is now more urgent than ever that shareholders promote, then support, plans for the oil and gas sector to manage the rapid decline in production.’
Mike Childs, Friends of the Earth head of policy, has said in response to this report: ‘Too much of the UK’s emissions reductions since 1990 have been through industry moving overseas. We need to keep the industry in the UK and ensure it is clean and green.’
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