UK oil and gas industry submit revised strategy for net-zero requirements.
The Oil & Gas Authority has submitted a revised strategy to the UK Parliament, featuring a range of new net zero obligations for the UK.
The revised Strategy reflects the ongoing global energy transition. Oil and gas currently provide about 75% of the UK energy consumption and official government forecasts expect oil and gas to remain important to the UK’s overall energy mix for the foreseeable future, including as we transition to net zero.
As long as this demand exists, managing production and maximising value from the UKCS as cleanly and efficiently as possible is necessary for security of supply, to ensure an orderly energy transition, and to reduce reliance on hydrocarbon imports. This is especially important as some imports, such as liquified natural gas (LNG) has a carbon footprint more than twice that of UK-produced gas.
The Strategy requires industry to operate in a way consistent with net zero ambitions, lowering production emissions and making serious progress on the solutions that can contribute to the UK achieving net zero. The OGA believes the industry has the skills, infrastructure and capital to help unlock net zero solutions, such as Carbon Capture and Storage (CCS) and hydrogen production.
Dr Andy Samuel, OGA Chief Executive, said: “This is an important moment in the North Sea story, bringing a key sector of the economy into the overall net zero project."
“We have a clear vision for how to achieve this, supporting industry to reduce production emissions and to provide the infrastructure, expertise and capital to unlock game-changing carbon capture and storage and hydrogen production at scale."
In addition to the net zero obligation, the revised Strategy also requires industry to work in such a way that encourages collaboration with the supply chain and actively support carbon capture and storage projects. The OGA will monitor governance closely and ensure that carbon costs are considered in its regulatory decisions.
Alongside the direction set out in the Strategy, Industry is also making progress in commitments to reducing production greenhouse gas emissions, and as well as stewarding towards emission reductions, the OGA will track, monitor, benchmark and report on this overall emissions reduction, and published its first benchmarking report on emissions from flaring and venting earlier this year.
The OGA is working with industry and government to unlock net zero opportunities at pace, and many in industry have already made real progress by taking positive action such as announcing targets for production emissions.
Energy Minister Kwasi Kwarteng said: “As the first major economy to set a target of net zero carbon emissions by 2050 the UK is leading the world towards a cleaner future. Only last week we made another ambitious commitment to cut our greenhouse gas emissions by at least 68% compared to 1990 levels over the next decade, which will see us go further and faster than any other nation."
“Our Ten Point Plan and Energy White Paper show how we continue to set the pace for the green industrial revolution, but as we transition to a low carbon future, oil and gas remain an important part of our diverse energy mix and I’m delighted to see net zero placed at the heart of this strategy.”
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22 December 2020