I have worked in industry for more than 50 years and have witnessed a number of extraordinary global changes. The number of people living in extreme poverty has fallen from nearly three-quarters of the global population to less than 10%; average life expectancy has risen by more than two decades; and it is now possible to communicate with anyone, anywhere, at any time. Energy – specifically energy from fossil fuels – has underpinned these advances.
In recent years, however, fossil fuels have come under growing scrutiny for the contribution they make to climate change.
Society no longer seems comfortable with an industry that has done so much good, but which now seems to pose so much risk. Some have suggested that oil and gas firms should plan to return money to their investors and wind down – but this would be a mistake.
In some areas there are currently no viable substitutes for oil, including aviation, maritime, and heavy commercial shipping, while natural gas is already playing a role as a lower-carbon transition fuel, replacing coal in the power generation sector. The oil and gas company of the future will have a dual mission: firstly, to continue to supply the hydrocarbons the world needs in as environmentally responsible a manner as possible; secondly, to contemplate the role it can play in the transition to a low carbon global economy.
There are a number of specific steps companies can take to deliver this dual mission. One is working in partnership with governments and researchers to unlock the potential of carbon capture, storage, and use technologies so that hydrocarbons can be decarbonised. Another is to build portfolios, which are naturally lower in carbon by focusing on long-term supplies of natural gas.
Actions like these will provide a firm foundation on which to rebuild the relationship between oil and gas companies and the rest of society. Continued economic and human progress depends on it.