Big oil has a do-or-die decade ahead because of climate change

AS REVOLUTIONARY SLOGANS go, it hardly had the resonance of ¡No pasarán! But when Repsol, a Spanish oil company, said in December it would reduce the net carbon footprint of everything it produces to zero within 30 years, it marked the most powerful pledge so far by a big oil firm to cast off some of the vestiges of a fossil past in favour of a windy and sunny future.

Many will scoff. Oil companies are, after all, widely regarded as the villains of the climate crisis. Repsol is a relatively puny producer; its vow may simply be a gambit to woo investors keen on “sustainability”. Yet it deserves a pat on the back. Without the oil industry’s balance-sheets and project-management skills, it is hard to imagine the world building anything like enough wind farms, solar parks and other forms of clean energy to stop catastrophic global warming. The question is no longer “whether” Big Oil has a big role to play in averting the climate crisis. It is “when”.

Ask oil executives about timing, though, and most hum and haw. They face a dilemma. Though the world needs them to throw their weight behind clean energy, their oil-and-gas businesses have traditionally generated higher returns. Yet forecasting returns is complex—and becoming more so. As well as project risk, it involves assessing the attitude of...



via Business Feeds

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