Global Witness Tampering

This morning I received an email from an outfit called Global Witness. Let’s take a look:

All of the $4.9 trillion the oil and gas industry is forecast to spend on exploration and extraction from new fields over the next decade is incompatible with the Paris Agreement’s 1.5°C goal, according to new analysis by Global Witness.

All of it? I confess, when the signing of the Paris Agreement was being celebrated by world leaders, I didn’t realise it meant an immediate and total halt on global oil and gas exploration and production. You’d have thought someone might have mentioned it.

The report, Overexposed, published today, is the first to compare the latest 1.5°C climate scenarios used by the Intergovernmental Panel on Climate Change with industry forecasts for production and investment. It finds that any oil and gas production from fields not yet in production or development would exceed what climate scenarios indicate could be extracted and burned while still limiting warming to 1.5°C.

I’d love to see the equation they’ve used to derive global temperature changes from oil and gas production figures. Sadly, the link to their methodology (.pdf) doesn’t include it, or any explanation of how they’ve arrived at this conclusion.

ExxonMobil is forecast to spend the most in new fields over the next decade, followed by Shell. Together with Chevron, Total and BP these five oil and gas majors are set to spend over $550 billion on exploring and extracting oil and gas that is not aligned with the world’s climate goals.

Next up: Toyota stubbornly making cars while world demands jet packs.

“There is an alarming gap between the plans of oil and gas majors and what the latest science shows is needed to avoid the most catastrophic and unpredictable climate breakdown” said Murray Worthy, Senior Campaigner at Global Witness and author of the report.

Meaning, there is an alarming gap between oil and gas demand as expressed by its users and the quantity Murray Worthy thinks they should be using.

“Investors will rightly be concerned that despite industry rhetoric to the contrary, the oil and gas sector’s spending plans are so drastically incompatible with limiting climate change. This analysis should encourage the escalation of investor engagement efforts to challenge oil and gas majors to credibly align their business plans with the Paris goal. Blindly pushing ahead comes with huge financial risks for investors, either as a result of the transition to a low carbon economy, or as the devastating consequences of a changing climate stack up.”

That’s a matter for investors, is it not? I hardly think investors in the oil and gas industry are so dumb as to not be aware of two or three decades of climate hysteria. I expect a good few are piling in on the basis that if the likes of Global Witness get their way, there will be a severe shortage of oil and gas supplies in future allowing them to make hay. No, what Murray Worthy is saying is he disapproves politically of how investors are spending their money, but dresses his words up as concern for their welfare.

Global Witness’ report finds it is only possible to claim this investment is compatible with the Paris climate goals by using scenarios that assume massive carbon capture and removal will take place in the future. This is despite the fact that these technologies remain unproven at scale.

Which is pretty apt, given the technologies which will render oil and gas production unnecessary are also unproven at scale.

The industry is at a crucial turning point; capital investment has fallen by over a third since 2014, largely due to a slump in oil prices. Yet, investment is forecast to rise by over 85% over the next decade, reaching over $1 trillion a year. Two thirds of this is set to take place in new fields.

It’s almost as if investors don’t take you seriously, isn’t it? Now why could that be?

Major capex projects in new fields that are due to be approved over the next decade include US domestic shale expansion, the Vaca Muerta shale in Argentina, the Kashagan oil field in Kazakhstan and the Yamal megaproject in Russia.

The Kashagan field went into production in 2013; I expect he’s talking about the expansion project, which doesn’t make it a new field. Vaca Muerta has been in production since 2011, and I expect he’s also talking about expansion projects. He’s on slightly firmer ground regarding Yamal; production on the Yamal peninsula started in 2017, but the project I think he’s talking about – the development of the Kharasaveyskoye field – is yet to go ahead. However, that’s a Gazprom project, so nothing to do with the majors listed in the article. It’s therefore not surprising Global Witness and those with real money at stake are not on the same page here, is it?

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7 thoughts on “Global Witness Tampering

  1. “Investors will rightly be concerned that despite industry rhetoric to the contrary, the oil and gas sector’s spending plans are so drastically incompatible with limiting climate change. This analysis should encourage the escalation of investor engagement efforts to challenge oil and gas majors to credibly align their business plans with the Paris goal. ”

    Yes. Curiously enough the oil majors are among the few shares surviving the liquidation of my share portfolio. With the prospect of rising crude prices I can foresee increased profits potential returning the share prices to last year’s record peaks.
    So, no & no.

    That good enough an investor survey for you?

  2. “the project I think he’s talking about – the development of the Kharasaveyskoye field”

    I think you’re giving them too much credit. They sound like someone who thinks that Rock music is really bad for kids’ morals and should be banned. Especially those new acts on the Hit Parade, the Rolling Stones and Black Sabbath.

  3. Well, what do you expect from an organisation funded by George Soros’s Open Society Institute; with a top up from the British government, to my horror, but not surprise.

  4. with a top up from the British government, to my horror, but not surprise.

    That explains why they can afford to advertise a job for a “campaigner” paying £43k per year. A real conservative government would have put a stop to all this years ago. The sooner Ecks gets into power the better.

  5. Much of that investment will be in the U.S., which isn’t party to the accord. So at least that much spending will be perfectly compatible with the aggreement, at least in the sense that my neighbor buying a boat is compatible with my wife’s and my household budget.

  6. The underlying issue is Junk Science. Has this punter ever heard of the Carbon Cycle?

    President Eisenhower made his famous warning about the Military-Industrial Complex in his 1961 Farewell speech. In the very next paragraph, he also warned about the politicization of science as research became increasingly dependent on government funding. Today, we are going to pay the price for politicized Junk Science used as the rationale for dumb policies.

    I have to admire the Chinese. They export unsustainable bird-killing windmills to the West, while building nuclear reactors at home.

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