Going Green & Still Pumping Oil? The Challenges of Climate Change for Fossil Fuel Producers
G&A's Sustainability Highlights (10.15.2022)
We were thinking the other day about the enormous challenges posed by climate change to our society -- and the resulting challenges of meeting ambitious goals being set by governments, the private sector, and investors to achieve a "net zero economy” by mid-century. That is not far away. And the pumping of millions of gallons of oil every day to meet the insatiable demands of society is not helping.
At the end of the 19th century, the United States was a very different country -- not so dependent on “oil” from below the ground (although we did rely on kerosene lamps). The majority of people lived outside of cities, most on farmlands and ranches. Horses and boats provided the main means for transport of people and goods (remember stagecoaches and canal boats?). Homes were heated by wood and coal fuels.
Coming into their own in the early 20th Century: electric power, telephones, radio, gasoline-powered cars and trucks, powered flight, modern chemicals, modern medicines. And people were moving en masse to rapidly-expanding cities and the newly-identified “suburban” communities, which required more railroads and roads to move commuters to city-center offices and factories. And so, the need for more drilling for oil and gas and mining of coal.
All of this dramatically changed how Americans today live, work, and play. The same things were happening in Europe, Japan, and many other places. And here we are in the 21st Century enjoying the fruits of progress and trying to undo the negative consequences of the sweeping changes made over the past 125 years or so.
To put some of this change and challenge in perspective: TIME magazine recently had an essay about Saudi Arabia, its state-owned oil company (Aramco) and the ambitions of the world’s leading oil exporting sovereignty to lean toward green while still pumping 12 or more millions of gallons of oil per day (to help meet global demand of 100 million BBLs a day!). The Saudis talk of carbon capture, moving to hydrogen power for autos, building a new “green” city (NOEM)…all while their oil keeps moving to distant points on pipelines and tankers. What is missing: a plan to reduce oil and gas production by 2030.
The Saudi Arabia we know today as a top oil and gas producer was a desert kingdom populated by Bedouin tribes and often shown on maps as “the Empty Quarter.” The discovery of oil in 1938 changed all of that – today the kingdom has a Sovereign Wealth Fund (SWF) with over US$600 billion and invests in many publicly -traded companies like Netflix (itself dependent on fossil fuels to power servers).
The impacts of climate change and the inherent challenges of our present society to achieve solutions are covered every day now in the media. Our editors and G&A team members carefully track and curate the coverage for you in these issues of Highlights and in our G&A Institute Sustainability Updates blog.
This issue of the newsletter features many news and feature stories about the efforts of public and private sector organizations to develop strategies and take actions to protect the planet and help the global society achieve a sustainable (and livable) planet in the decades ahead.
This is just the introduction of G&A's Sustainability Highlights newsletter this week. Click here to view the full issue.