Tim Eggar, chair of the Oil & Gas Authority. Photo: OGA
Oil and gas companies have been warned by their regulator to stop “navel gazing” and do much more to solve the challenges of climate change.
Tim Eggar, the chairman of the Oil & Gas Authority, said:
“Industry’s social licence to operate is under threat and there is no scope for a second chance.”
Speaking to company bosses, the former Conservative energy minister said the oil and gas industry was seen as part of the problem in the transition to net zero carbon emissions.
He did not specifically refer to onshore operators during his speech. But he said the entire industry had to do everything it could to contribute to legally-binding commitments on carbon emissions. He said:
“That applies to the OGA, and to every oil and gas operating and service company.”
Mr Eggar said oil and gas would remain critical parts of the UK energy mix for “the foreseeable future”. The country could not transition to net zero carbon emissions without gas, he said.
But he added that social media and the popular press saw the oil and gas industry as part of the problem not the solution.
“Industry’s licence 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 licence to operation is under serious threat.”
Mr Eggar said:
“There has been too much navel gazing. We have to act much, much faster and go farther in reducing the carbon footprint.
“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.”
There should be action, “not just talk or more analysis”, he said.
The industry needed to make real progress on carbon capture and storage by the time of the UN climate change conference, COP 26, in Glasgow in November 2020, Mr Eggar said.
It had to reduce production emissions, commit to clear measurable greenhouse gas targets and make real progress on methane emissions.
Mr Eggar said maximising economic recovery of oil and gas did not need to conflict with the transition to net zero. But transition needed involvement of the full workforce and supply chain.
He also suggested that the levy paid by companies to the OGA would increase to pay for extra work towards achieving net zero.
Categories: Industry
DRILL OR DROP? 
So investors out there be warned, your returns will be less, but more chance of the human race surviving.
PaulaC – I think that investors can factor in those considerations without your “expert” advice
Paula C-be warned, Schadenfreude is not a good look.
How easily you forget the panic around the world a few days ago, when oil and gas supplies could have been interrupted. Think you will find investors noticed. So, that is still the reality, and I suspect it will be so for at least another 20 years.
And of course no land owner installed a wind turbine just because he was guaranteed £150k profit/year, whether the electricity was needed or not? Even admitting they hated the things? Maybe not on DoD, but they did.
So, yes there are loopy posts on DoD, and they are weighted towards those antis who post about subjects they clearly know very little about, but seem to need to raise their social media “profile”. You don’t even need to enter any debateable areas, but just observe the constant posts regarding fracking associated with sites that have never fracked and have no intention of doing so. Cheered on by antis who try to excite more such comments, with comments of their own, like “it’s all fracking!”
Claiming moral high ground, or superior intelligence, should not be required if your argument is sound. The constant drivel around those who don’t agree with you that they are therefore earth killers, rather than they disagree with your approach. It is an easy option, but it certainly doesn’t reach any high ground or demonstrate any level of intelligence.
There are those who claim the credentials, do the XR bit, join the Greens, campaign when needed, yet-on inspection-have two cars (neither electric), groceries and other items delivered every few days, and gardeners who arrive each fortnight with their van full of fossil fuelled kit to tidy the garden. Yes, they are real, and lovely people, but if that is the way to mitigate against climate change, I will stick to my own approach thank you.
Paula C
Maybe…
While a diversified portfolio is always a good idea it seems that investing in orsted ( see past DOD posts ) for wind or on German Coal has been a winner.
https://www.exponentialinvestor.com/commodities/coal-dirt-poor-or-filthy-rich/
Investing in BP or Shell good for dividends.
But what next? The writers of the link above are keen on hydrogen. However, the big oil companies may well decided to shrink themselves and throw off huge amounts of cash as they do so. Decisions decisions eh!
The reality is the fossil fuel industry is the problem and the blocker. The industry has had decades to change but has largely paid lip service to climate change and essential change. It has funded climate change denying organisations and lobbied to roll back carbon reduction targets.
No KatT – people need to stop using fossil fuels and then the industry won’t be needed. But it’s not very likely that people will do that is it? The CCC report makes it very clear that gas is part of the solution to achieving a zero carbon economy. Attempting to stop gas production will result in an increase in fossil fuel use. I don’t know of any academics who think otherwise including those that wrote the IPCC reports.
Stand by what I said James. And people will gladly stop using fossil fuels as soon as they can. The first phase is a significant reduction and then fossil fuels will only be used where there is no alternative and then eventually when technology advances again they will hopefully be completely stopped. The sooner we can stop using fossil fuels the better and the sooner the fossil fuel industry stops funding climate change denial and undermining progress to green energy the better. Less reliance on fossil fuels will also hopefully calm down negative geopolitical influences as well.
James Maynard. You say people need to stop using fossil fuels but it’s not very likely they will. Whilst planners allow building homes miles away from where people work and those homes are poorly insulated in order to save the builders a few pounds people will be forced to use fossil fuels. Until the government actively supports renewable energy instead of placing obstacles in the way people will be forced to use fossil fuels. Until we have far better public transport people will use cars. All decent people want to do their bit to save the planet for their children and grandchildren but it’s up to policy makers take the lead and to provide their people with the opportunity to that. So long as the policy makers are beholden to the fossil fuel industry for large party donations and promises of lucrative directorships and the like, this is not going to happen.
Pauline
Re house insulation levels, new houses have higher levels of insulation than previously. Looking at the three large developments in the village ( not built in town as that is already built up) the levels of insulation are far better now than those built in 2001 ( the one we own ) especially in terms of wall insulation, floor insulation and roof insulation. Indeed much better than any older house in the village.
Therefore I would disagree with you that the houses are poorly insulated.
In addition you can specify electric heating and car charging points if you wish, at additional cost, or may be multi entry heat storage systems to future proof the house ( for when you fit the solar panels or dig up the tiny garden for a heat pump )
In addition, parking is restricted to discourage multiple car ownership.
There are plenty of bus services and a train service as well. There is a cycleway into town or if you feel fit you could canoe down the canal.
But most prefer to use cars. It must be the convenience.
I don’t know where you are referring to but I can assure you that bus services where I live are so poor and expensive that most families need at least two cars to get to work, with traffic gridlocked at peak times. Even the local sixth form college car park has had to extend its already large car park to accommodate students’ and staff cars. Insulation on new homes may be better than in older properties but there is still more that could be done with the majority of new homes being built down to a price.if you really consider that this country is doing all it can to combat the climate crisis you are living in a dream world.
Pauline
I refer to where I live, which is a village in lincolnshire. But my point is that even with the benefits it had, people prefer to use their cars.
That point is highlighted by your examp!e of the sixth form college. In 1972/3 no one in the 6th form drove to school. It was bus, bike or walk ( 8 mile round trip in my case ).
Some dis incentive is required I suspect in order to take cars off the street.
Re houses, unless you are building your own house and have no restriction on your budget, all new houses are built to a price, but in every case they need to comply with the relevant building regulations. Hence, that houses need to be built to budget is not a relevant point. That point should be , in my opinion, your dissatisfaction with the relevant building standards set by the gov.
‘re doing all we can to combat the climate crisis. That I disagree with what you say in some cases, does not mean that I feel we are doing all we can in order to climate change. I just disagree with your take on the issues you raise.
Pauline
I forgot to add….
Not all people are keen to do their bit to save the planet. Some are against onshore wind.
https://www.walesonline.co.uk/news/wales-news/protests-uks-biggest-ever-wind-4050017
I realise that this protest was a few years ago, and that if the same proposal were resurrected then they may be rolling out the red carpet, but I doubt it.
I am not sure how such protests fit into the story that, if it were not for the evil fossil fuel industry, such developments would be installed and running.
Thank goodness the last few gov took the easy option to go offshore. But now that a climate emergency has been declared such plans will be rubber stamped , protest or no?
Hmm, Mr Eggar chairman of the OGA, says a lot, but what ware the actual actions they intend to put into place? Certainly he is correct about such a thing as a “social license” (is that a legal definition that has any validity whatsoever?) Is very much in jeopardy. But who is to blame for that?
Just look at the combative, aggressive and abusive and plain loopy posts we get from those on Drill or Drop who pretend to represent the industry?
Is this the sort of person who is responsible for the total meltdown of a social licence for the oil and gas industry?
“I cant wait to make a killing on rbd and ujo shares,swampies and eco warriors can get stuffed . The country needs to use its resources and this is exactly what’s needed.”
Well if that is an example of a plea for a social licence, they have an awful long way to go before anything even remotely “social” is approached, let alone achieved. The possibility for a social licence for the OGA is a pipedream…..there is a joke……
I suspect its all spin and smoke and mirrors anyway. I cant see any improvement in the seven odd years i have posted on Drill or Drop In fact entirely the opposite is true.
There has been a massive dumbing down and degradation from the supporters of oil and gas. So much so that the reason of some of them could be called into doubt?
I dont think we have the time or energy….there is another joke….to drag the OGA back into the real world. Particularly as they have NDA’s and censorship and deletion of data agreements with the big operators.
Reference Mr Eggar’s belief that oil and gas would remain critical parts of the UK energy mix for “the foreseeable future” and that the country could not transition to net zero carbon emissions without gas, see David Wallace-Wells ‘The Uninhabitable Earth’. Good introduction on YouTube.
The problem isn’t a lack of social licence, that’s a symptom.
The real problem is that you can’t have a policy to achieve Maximum Economic Recovery of oil and gas AND comply with our carbon reduction commitments (which themselves aren’t radical enough).
Developing CCS didn’t happen, that was shelved along with investing in renewables in a massive error of judgement by Cameron which still hasn’t been reversed.
Listen to what Dr. Peter Carter (IPCC expert reviewer) thinks of our progress, if you have the courage to face up to the future; https://youtu.be/oa13KrOvE2s
It’s inevitably going to get hotter, but we can still prevent the very worst of it if we act now.
Good heavens! Did Mr Eggar wake up and smell the coffee, or is it just greenwash to keep his O&G industry lumbering on for a little longer? Only time will tell.
More than 60 nations have taken the pledge to achieve “carbon neutrality” by 2050. However, almost none of the leaders making this promise are willing to publish any real cost-benefit analysis. The only nation to have done this to date is New Zealand: the economics institute that the government asked to conduct the analysis found that going carbon neutral by 2050 will cost the country 16% of GDP. If the small nation follows through with the promise, it will cost at least US$5 trillion to deliver a temperature cut by 2100 of 0.002°C / 0.004°F.
I argue in New York Post that we need more honesty in the climate debate, and politicians who focus on realistic policies instead of lofty promises, click the following link to find the full article and much more in our latest newsletter: http://ow.ly/7NzG50xWyDK
Free Fact Checking of the New York Post for you:
https://mediabiasfactcheck.com/new-york-post/
Media Bias/Fact Check
“New York Post
Mixed Factual Reporting – Not always Credible
New York Post – Right Center Bias – Credible – Reliable – Conservative – RepublicanRIGHT-CENTER BIAS
These media sources are slightly to moderately conservative in bias. They often publish factual information that utilizes loaded words (wording that attempts to influence an audience by using appeal to emotion or stereotypes) to favor conservative causes. These sources are generally trustworthy for information, but may require further investigation. See all Right-Center sources.”
“Overall we rate the New York Post on the far end of Right-Center Biased due to story selection that typically favors the Right and Mixed (borderline questionable) for factual reporting based on several failed fact checks.
Detailed Report
Factual Reporting: MIXED
Country: USA
World Press Freedom Rank: USA 48/180”
History
“In 1976, Rupert Murdoch, the owner of News Corp, acquired The New York Post and in 1988, Murdoch sold the paper to Real estate developer Peter S. Kalikow. When Kalikow lost the paper to bankruptcy in 1993, Rupert Murdoch once again purchased the paper and continues to own it today. Since Murdoch took over the paper, The Post has been known for their over-the-top sensational headlines.”
Funded by / Ownership
“The New York Post is currently owned by Rupert Murdoch’s News Corp, which owns many conservative/sensational media outlets around the world. The paper is funded through advertising, subscriptions and newsstand sales.”
Analysis / Bias
“According to an LA Times article, the New York Post was reported to be the preferred newspaper of U.S. President Donald Trump, who maintains frequent contact with its owner, Rupert Murdoch. The Post, According to a survey conducted by Pace University in 2004, was rated the least-credible major news outlet in New York. Further, The Post has been criticized since the beginning of Murdoch’s ownership for “sensationalism, blatant advocacy, and conservative bias.”
“A factual search reveals several failed checks.”
“Mostly False: Ted Cruz ‘same senator who once supported a ban on sex toys’ – Mostly False
Newly Discovered Planet Could Destroy Earth Any Day Now – False
Hillary Clinton Regularly Had Her Maid Print Classified Documents – Unproven
PS 169 Pledge of Allegiance and Holiday Ban Controversy – Mostly False
‘New York Post’ op-ed rebuts starving children claim that was never made – Pants on Fire
Overall we rate the New York Post on the far end of Right-Center Biased due to story selection that typically favors the Right and Mixed (borderline questionable) for factual reporting based on several failed fact checks. (7/16/2016) Updated (M. Huitsing 7/13/2019)”
phil the angry man c: Copy Paste?
elie-the angry man-g: An angry man looking at the truth, sees nothing but anger, and yet the truth is not angry.
Written by a type of global warming sceptic that believes global warming is by no means our greatest environmental threat and cites Aids malaria and malnutrition as greater threats? This is a personal and political opinion and not in agreement with mainstream climate change science. Climate change leads to more severe and frequent weather events that cause drought and floods resulting in more malnutrition and disease so that would make his argument illogical.
And what is the alternative to finding solutions to drastically cutting our greenhouse gas emissions, destroy the planet or find the money to preserve the planet?
“In 2009, Business Insider cited Lomborg as one of “The 10 Most-Respected Global Warming Skeptics”.[2] While Lomborg campaigned against the Kyoto Protocol and other measures to cut carbon emissions in the short-term, he argued for adaptation to short-term temperature rises, and for spending money on research and development for longer-term environmental solutions. His issue is not with the reality of climate change, but rather with the economic and political approaches being taken (or not taken) to meet the challenges of that climate change. He is a strong advocate for focusing attention and resources on what he perceives as far more pressing world problems, such as AIDS, malaria and malnutrition.[3][4]
https://en.wikipedia.org/wiki/Bjørn_Lomborg
Unfortunately, Dorkinian, there is a problem with your “we”!
The impact the UK can make against what other countries will do, and the increase in world population, will mean carbon neutral UK will make no measurable difference to global climate change.
That does not mean the UK should sit on it’s hand’s but making false claims will help no one. Indeed, it will produce the opposite effect. What would be the result if the UK taxpayers spend the £1 trillion and are then being told a few years down the line that climate change has not been moderated in any way? Your documented stance against HH as a means to impact climate change shows how that argument is flawed both mathematically and scientifically. Extending the approach to UK simply makes it a larger flaw.
Interesting piece in the Times today, hewes62 around hydrogen and Shell. Still the issue of cost of production and how to deal with the carbon, but I have a suspicion the fossil fuel companies will crack that. Of course, electric and hydrogen vehicles could both be desirable, except if the hydrogen issue is solved, would there be any point in the car companies investing in both?
For clarity Martin my “we” in this context is the human race, and I don’t exclusively oppose hydrocarbon extraction at Horse Hill. I do think it’s particularly mad to be extracting tight oil from the Kimmeridge, for all the obvious reasons, when we have to leave so much in the ground.
Well, HH is not just about the Kimmeridge, is it?! I think it is only yourself who trots out “Kimmeridge” every time HH is mentioned. If there is one source of oil on a site (commercial) then why not extract oil from another source on the same site (also commercial)? Not only makes economic sense but also environmental sense.
Until you can control the human race, the clarity is anything but. Only this week there was Russia indicating they wanted to increase the birth rate! Sounds fun, but the reality is that if they do, all the extra little Vlads will be extending their use of fossil fuels-for starters. And then, not so long back, the cessation of the one child policy in China, and across the world where infant mortality was horrific, it is no longer the general case. And, most will not even be vegans! And then to feed such numbers more land will need to produce more which will involve more fertilizer, but farm animals will have been decreased so I wonder where that fertilizer will come from? No, I do not, but some seem to.
It is up to UK to do what it wants, but let’s do what we do without claiming it will produce a result that it will not, simply to create a false narrative to replace Nimbyism, now that term has lost some of it’s gloss. Let’s also not go on about insulating all these homes, yet it is evident many are already very well insulated, as can be seen quite easily as and when the snow falls and settles on them, and stays. If those sort of approaches are the best that can be done, they will quickly be found out and the bath water will be thrown out with such babies.
Maybe that is why Big Oil is so relaxed?
Martin the U.K. per capita has one of the largest carbon footprints, we export our emissions to China and then ship them back. So many U.K. brands have goods produced in China. If our industrial base was greater so would our emissions be. It is a false argument to claim the U.K. doesn’t have a significant role to play in fighting climate change both diplomatically and in terms of our emissions and behaviours. Every country could argue the same and then we would achieve nothing. Far better to be at the forefront of this essential change in terms of engineering and technology. Climate change and emissions have no borders, all countries have a part to play and just because we offshore our emissions doesn’t in any way absolve us now, in the future or from the huge amounts of greenhouse gasses we have pumped into the world’s atmosphere in the past.
Sorry KatT, that doesn’t add up.
Yes, we export our emissions to other countries, some of which we have no need to do eg. on shore gas and oil. Even that tiny impact is being limited by some, including you.
If we currently export other manufacturing emissions to places like China what do you think would happen with NEW engineering and technology?? Where do most of the solar panels come from now? Maybe they are more competitive because they have cheaper production costs? Tesla just opened a factory in China. I suspect their Chinese production will work out cheaper than their German production and then trade barriers will be needed. That should be fun.
When other countries start paying UK for the industrial revolution benefits they now enjoy, then maybe they can discount some of the “costs” off the bill? UK would be quids in, so no need to have any guilt around that.
Indeed, every country could argue the same. But, without every country doing the same nothing will be achieved. To stick your head in the sand and suggest that is not the reality will just make those children and grandchildren say one day, “that was a good hearted generation, who have left us no better off but with a huge bill.”
So, the UK will do what it wants, but don’t make that out to be world changing. The politicians will claim that.
Martin
Thanks for the information. Will have a look.
“The industry needed to make real progress on carbon capture and storage by the time of the UN climate change conference, COP 26, in Glasgow in November 2020, Mr Eggar said” I absolutely agree, but industry has lost trust in UK government for this to happen due to Mr Osborne (ex Con Chancellor) cancelling the CCS Demo, in order to raid £1bn , plus EU funding, in one of his disastrous ill thought through budgets. That inept decision by Mr Osborne has put UK back more than 15 years in in demonstrating a full chain CCS in the UK. The oil & gas industry alone is not the answer, it also needs long-term partnership with governments. These are major infrastructure projects.Mr Eggar does seem realise this if he expecting considerable progress in CCS by next November!!!!!!!
Dr Nick
I agree tho parties of all hues have been somewhat tardy in getting behind CCS
https://www.chemistryworld.com/news/bp-pulls-out-of-carbon-capture-plans/3000608.article
Which was a shame as that project was quite interesting ( and the report includes names which have turned up after here on DOD.)
Maybe if carbon was looked at as a valuable commodity and the emphasis was on capture and then using, there would be more success? Maybe diamonds and graphene would be difficult to achieve but I do recall both Oxford and Cambridge suggesting a while ago this was a good route to go. Perhaps it would require loads of research dosh to them, but maybe there was more to it than that?
Maybes and perhaps, but possible. Bit like fusion.
I remember that Tony Blair was sure that the problems caused by climate change could be solved by engineering such as CCS,..however companies are very rarely so altruistic that they want to put in more than they take out. It takes governments to step up on this kind of thing. He also wanted everybvody to be able to fly – hence why it has become cheap and frequent which has probably not helped the climate.
cjr-I would rather trust companies regarding UK energy policy than the UK Government. If you check, UK Government has been very poor in decision making in this regard.
Surely a well established industry making billions every year across the globe can fund its own research to prolong the life of its assets? Why should the tax payer foot any part of the bill? The industry has had decades to prepare for this. Instead of funding climate change denying organisations and lobbying governments to roll back carbon reduction measures it should have invested far more in accepting a green future.
Kart
You are right to question why oil and gas companies have not spent more on CCS, not why nations such as Norway , Saudi, Nigeria, Iran, Russia and China have not done so either.
I would hazard a guess that CCS was seen as coal and point of use issue. The oil and gas industry were going away to develop gas and save the planet from dirty coal. Plus CCS is something you do at the point of use ( primarily power stations ).
But for the Miller project, the gov ( and tax receiver ) were keen to keep to keep on with the massive tax take, but not so keen to cut some slack when it came to CCS for Peterhead Power Station. Maybe they preferred piling it into the wallets of onshore wind moguls instead.
Meanwhile In 2000 no was the third largest solar energy company in the world, and between 2005 and 2015 invested over $8 Billion dollars in wind energy.
This may not fit In with the story that all fossil fuel.companies spend their money on climate denial and disrupting green energy development. Some may, but as most profits from oil and gas revert to nation states and their peoples , the blame can be spread around a bit I guess.
I would note that spread around their people can include their elites and the warring of proxy wars on the back of oil and gas industry tax take.
what about the cost to police any site, not viable imo.