National oil companies produce about 55 percent of the oil and gas the world consumes. Nevertheless, these companies and their role in the energy transition have largely remained on the sidelines of climate negotiations, debates and campaigning.
As public entities, national oil companies (or NOCs) are owned by the citizens of oil-producing countries, many of which face persistent poverty and high inequality. At this press conference three experts spoke on national oil companies, climate and energy transition for insights on NOCs and what is at stake at COP28.
Topics and speakers
Risky bets and public funds. Despite the imperative to transition beyond fossil fuels, NOCs are planning $1.8 trillion on oil and gas developments and expansions over the next 10 years. Seventy-one percent of these investments will only turn a profit if humanity fails to meet the 1.5 C target. A quarter of the total NOC investment will be unprofitable if oil demand falls to 55 million barrels a day, which is in line with the International Energy Agency’s Announced Pledges Scenario.
Finance and investors. NOCs face increasing uncertainties due to changing energy systems. But financial actors’ approaches are currently not aligned with the need to mainstream climate considerations into NOC business models.
IISD's Natalie Jones shared insights on how financial actors can support NOCs’ just and ambitious low-carbon transition, based on new analysis by the International Institute for Sustainable Development (IISD), the World Benchmarking Alliance, and the University of California Santa Barbara.
Just transition. Just transition for oil and gas producers is a relatively new area, particularly their role in helping their countries achieve a just transition – in terms of economic diversification, jobs, communities, revenue management, contracting and governance.
Glada Lahn of Chatham House shared early findings from new research on what just transition means for middle-income oil and gas producing countries, focusing on the cases of Colombia and Nigeria. This research is being led by Chatham House, the World Resources Institute (WRI), and national researchers in Colombia and Nigeria.
This event was livestreamed on the UNFCCC website.