The move to net zero carbon

The OGA is committed to helping the UK government reaching its goal of net zero emissions by 2050 and have refreshed our core Strategy to integrate net zero and develop benchmarking to monitor emissions performance.

The energy transition requires industry to reduce its carbon footprint through initiatives including electrification and energy efficiency initiatives. The OGA are working closely with government and industry to support these measures, as well as other solutions including Carbon Capture and Storage (CCS) and hydrogen.

The OGA believe that economic recovery of oil and gas need not be in conflict with the transition to net zero and that the industry has the skills, technology and capital required to help the UK achieve the target. The OGA also takes the view that the industry must go faster and farther in reducing its own carbon footprint, or risk losing its social licence to operate.  As a result, the OGA have challenged industry to deliver quicker action to ensure progress in several areas including:

  • 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.
  • Deliver measurable progress on energy integration opportunities – for example, an electrification project.
  • Accelerating efforts to ensure there is a diverse array of skills and people for the long-term energy offshore and supply industry.

Further details on the challenge set to industry can be viewed here.

Since setting this challenge there has been welcome progress in a number of areas.

Emissions reduction

The OGA welcome the oil and gas industry’s commitment to becoming a net zero emissions basin by 2050 and halving operational emissions in the next decade.

It is crucial that industry must maintain efforts to reduce its own footprint and also stay focused on reducing emissions in the near term. Therefore, OGA have incorporated these targets into our data benchmarking to monitor progress.

Gas footprint of domestically produced gas

The OGA published analysis which shows that gas extracted from the UKCS has an average emission intensity of 22 kgCO2e/boe; compared with imported LNG, which has a significantly higher average intensity of 59 kgCO2e/boe. The process of liquefaction, combined with the emissions produced by the transportation and regasification of the LNG once in the UK, are responsible for the considerably higher emissions intensity.

Importing gas via by pipeline, particularly from Norway, produces an even lower average of 18 kgCO2e/boe, which suggests there is still potential for the UKCS to continue to improve its operations and lower emissions further.

Energy Integration

As of August 2020, there are over 30 energy integration projects already underway across the UKCS, with more than 10 actively being engaged by the OGA. The integration of offshore energy systems, including oil and gas, renewables, hydrogen and carbon capture and storage, could contribute to deliver approximately 30% of the UK’s total carbon reduction requirements needed to meet the 2050 net zero target.  For further details please click here.

Operator 'Deep Dives' and asset stewardship expectation

We have already completed a number of ‘deep dives’ with operators to understand their net zero plans and we will be adding a new net zero stewardship expectation [and updating the others where relevant] to reflect the new regime set out in our new core Strategy.

The framework underpinning the move to net zero carbon

Legislative framework

In 2019 the UK became the first major economy in the world to pass laws to end its contribution to global warming by 2050. The target requires the UK to bring all greenhouse gas emissions to net zero by 2050, compared with the previous target of at least 80% reduction from 1990 levels. The legislation can be viewed here. The relevant legislation, passed by the Scottish Government, setting a 2045 target for net zero emissions of all greenhouse gases, can be viewed here.

Climate Change Committee

An independent statutory body, the Climate Change Committee (CCC), was established under the UK Climate Change Act 2008 to provide regular advice to the UK Government and devolved administrations on setting and meeting emissions targets and preparing for climate change. It also monitors and reports on the progress made to Parliament.