Conference Highlights Voluntary Actions on Climate Change

Published January 1, 2003

A major international conference held November 20-21 in Houston, Texas brought together an impressive array of scientists, federal officials, non-government action groups, and industry leaders to share ideas and report on progress in climate change science.

Voluntary actions by the oil and gas industry are creating breakthrough technologies and making a significant contribution to global efforts to reduce greenhouse gas emissions, participants reported at the Second API Conference on Voluntary Actions By the Oil and Gas Industry to Address Climate Change.

European Perspective

John Campbell, technical director for the International Association of Oil and Gas Producers (OGB), kicked off the conference by offering a European perspective on the global climate issue. Campbell noted the OBG itself does not have a climate change policy, as its members have diverse interests. However, Europeans generally take pride in demonstrating leadership on greenhouse gas issues. They are, therefore, seeking mandatory cuts in greenhouse gas emissions, applying to most European nations by 2005.

Foreshadowing a major theme of the API conference, Campbell asserted that depleted gas and oil wells offer promise for sequestering carbon dioxide (CO2), the primary target of greenhouse gas limits. Technological advances are not the only hurdle in the path of widespread CO2 sequestration. “The technical solutions themselves do not necessarily lead to legal feasibility,” Campbell observed. Indeed, according to Campbell, the legal obstacles are “as daunting as the technological issues.”

According to Campbell, most CO2 sequestration opportunities exist in depleted offshore wells. However, those wells are subject to international environmental treaties as well as the Law of the Sea treaty. Even if CO2 sequestration becomes a viable technological option in the near future, an international consensus will have to develop on related legal issues.

Science Outpacing Politics

“We can’t wait 50 years for permits to inject CO2 into the ground,” responded Craig Lewis, a senior staff scientist in the ChevronTexaco Process Technology Unit. “We don’t need another Yucca Mountain situation,” referring to the long-delayed repository for spent nuclear fuel in Nevada.

“Natural CO2 fields have held CO2 reservoirs for millions of years. We can learn a lot researching these fields,” Lewis stated.

Like many of the conference participants, Lewis was wary of injecting CO2 directly into the ocean depths. However, he noted CO2 dissolves in water and can be stored in natural underground chambers. Moreover, CO2 can interact with certain silicates to become a permanent part of subterranean rocks.

Sequestration of a sizeable portion of U.S. CO2 emissions is technologically feasible, according to Lewis, but would require an infrastructure comparable to America’s natural gas infrastructure. “This will be a growth industry for some smart people,” Lewis predicted.

Bush Administration Strategy

James Connaughton, chairman of the Council on Environmental Quality, outlined the Bush administration’s two overriding policy goals: economic growth and improving the lives of people worldwide. Any greenhouse gas abatement program must meet these two goals to be politically feasible, Connaughton said. The Kyoto Protocol, according to Connaughton, is fundamentally flawed because it conflicts with the first goal and does nothing to advance the second.

Within the context of climate change issues, the administration believes the most important issues are advancing and understanding climate change science, developing and deploying appropriate technology, and formulating an informed greenhouse gas mitigation strategy. According to Connaughton, arbitrarily cutting CO2 emissions before understanding the science and developing appropriate climate change technologies will have little long-term environmental impact, but substantial, immediate, and negative economic impacts.

To further the administration’s goals, President Bush has set a goal of reducing by 18 percent the greenhouse gases emitted per unit of economic growth over the next decade. Connaughton observed this goal would follow America’s success in cutting its greenhouse gas intensity by 14 percent during the past decade. Using economic incentives and voluntary measures allows for cutting greenhouse gas emissions without sacrificing economic growth.

Examples of such economic incentives, according to Connaughton, are proposed tax credits for climate change research and industry reductions in CO2 emissions. The proposed tax credits are “unprecedented and unsurpassed” by any other nation. Moreover, “we have a $4.5 billion climate change budget this year that surpasses any other nation.” Additionally, the administration is pushing for $40 billion in incentives for agricultural greenhouse gas mitigation.

Agricultural incentives are a common-sense strategy for a very simple reason, according to Connaughton. “This is a message that has been lost in the political debate–manufacturers are now emitting 5.7 percent below 1990 levels in greenhouse gases.”

“Individuals and the private sector want to do the right thing,” Connaughton stated. “Now government must facilitate individuals and the private sector doing the right thing.”

IPCC Warming Concerns

Jennifer Solomon, a research scientist with the Intergovernmental Panel on Climate Change (IPCC), stressed the agency wants to hear from the petroleum industry regarding what issues it would like to see addressed in the next IPCC assessment. Solomon asserted the world is undergoing a dramatic and unprecedented rise in temperatures. “The evidence is strong that there is a human contribution [to recent warming trends], particularly in the last few decades.”

Solomon stated there is probably more CO2 in today’s atmosphere than at any time in the past 20 million years. Cooperation and solutions must come from all segments of society, she asserted. “I am pleased to see the carbon sequestration workshop in the API conference agenda.”

WWF Seeks Mandatory Cuts

Jennifer Morgan, director of the World Wildlife Fund’s Climate Change Program, expressed concern that global climate change will cause declining crop production and more widespread diseases such as malaria. She criticized carbon sequestration as a primary greenhouse gas abatement strategy, and instead called for a mitigation approach via mandatory reductions in fossil fuel use.

“Voluntary approaches are not enough,” Morgan said. “They must be part of a mandatory regime.”

To the extent there may be a human contribution to global climate change, countered Connaughton, we should research and consider all mitigation opportunities, including carbon sequestration. We should expand rather than constrict our range of options, he noted.

Measure, Then Manage

A necessary first step to managing greenhouse gas emissions is increasing our knowledge of greenhouse gas science and our ability to quantify greenhouse gas sources, according to Bruce Eidt, global energy management system manager for ExxonMobil Refining and Supply Company. “We have a saying at ExxonMobil,” stated Eidt. “If you can’t measure it, you can’t manage it.”

To that end, ExxonMobil is strongly committed to researching and funding climate change science. ExxonMobil is already one of the leading corporate sponsors of climate change research, and the company’s senior issues advisor, Walt Buchholtz, announced at the conference that ExxonMobil was donating $100 million to a new Stanford University project to research and solve climate change issues. (See “ExxonMobil, Stanford Team Up on Climate Change.”)

While industry and research institutions continue to make scientific progress regarding CO2 sequestration and future energy sources, it is important not to prematurely select winners and losers among future technologies, said Eldon Priestly, manager of corporate strategic research for ExxonMobil Research and Engineering.

Before anointing hydrogen the winner in such a contest, for example, “we have to remember that hydrogen is a carrier rather than a source” of energy. In addition to hydrogen energy efficiency problems, there are also safety concerns, particularly in the context of motor vehicles. “I’m not sure that enough data exist regarding the hazards and risks of hydrogen fueling in the hands of the consumer,” said Priestly.

Shell Optimistic

Shell Global Solutions Licensing Manager Jan de Graaf provided more European perspective. “Global warming is genuine and demands a universal response,” said de Graaf. “Kyoto is just a beginning–more needs to be done.”

At Shell, the emphasis is on mitigating CO2 emissions while scientists work toward a carbon-free energy future. Specifically, Shell is committed in the short term to de-carbonizing its fossil fuels prior to consumer delivery, sequestering CO2 in centralized locations, and making proven alternative energy technologies available to today’s consumers. These short-term approaches, de Graaf said, will serve as a climate-friendly bridge to a future of non-carbon fuels.

Shell envisions that by 2025 a quarter of all new vehicles will be powered by fuel cells. Shell is focusing its current research on this and similar technologies in order to position itself as the supplier of future as well as current energy sources.

Roxanne Decyk, Shell’s senior vice president for corporate affairs/human resources, expressed similar optimism regarding an alternative energy future. According to Decyk, Shell sees a transition to renewable energy sources occurring on a macro-dominant scale by 2050, if not sooner. By 2050, Shell envisions renewable energy sources gaining a 30 percent share of world markets, with a 100 percent share of post-2050 incremental advances.

As a bridge between today’s energy sources and the renewable future, Shell is committed to increasing its production of natural gas vis-à-vis oil. Decyk reported Shell intends a near-term increase in its natural gas production from its current 40 percent share of Shell energy production to a 60 percent share.

BP Credit Positioning

Reid Smith, environmental advisor with British Petroleum’s Onshore Business Unit, said BP considers a carbon credit scheme “absolutely critical” to mitigating greenhouse gas emissions.

A credit scheme, according to Smith, would introduce a necessary “market-based” element to greenhouse gas cuts. BP reported it is expanding its solar and hydrogen energy production in order to position itself to take advantage of such a carbon credit scheme.

Even so, BP recognizes hydrogen is not a free-standing energy source, requiring an expenditure of energy to free it from other molecules. There would still be greenhouse gas issues in a hydrogen economy, Smith reported.

Flare Abatement

Uncontrolled flares during the course of oil recovery are an often-overlooked but important contributor to greenhouse gas emissions, stated Bent Svensson, lead energy economist for the Oil, Gas and Chemicals Department of the World Bank Group’s Global Products Group. Flares at African recovery sites alone waste the energy equivalent of 85 million low-income urban households.

Moreover, noted Svensson, such flares contribute 1 percent of all greenhouse gas emissions, and 10 percent of the total Kyoto greenhouse gas reduction goals. According to Svensson, research and technological advances in the petroleum industry are likely to eliminate most of these flares in the near future.

Sequestration a Viable Option

“Carbon capture and storage is a key and material bridging technology” to an alternative fuel future, stated Else Hafstad, director of corporate strategic technology for Statoil. Moreover, the petroleum industry is uniquely poised to take the lead in this new industry. “Energy companies often control both the source and the sink,” Hafstad noted. Hafstad, a member of the CO2 Capture Project, stated carbon sequestration is a viable greenhouse gas emission abatement strategy for the near future. America has shown leadership regarding this emerging technology, Hafstad reported. “The U.S. has contributed largely to CO2 Capture Project funding.”

Waleed Jazwari, project director of the IEA Weyburn CO2 Monitoring and Storage Project, reported carbon sequestration is both technologically feasible and environmentally safe. Computer simulation modeling and real-world monitoring of experimental projects have shown subterranean sequestration can be a safe and effective form of trapping CO2. Jazwari reported there has yet to be any unforeseen CO2 migration in underground natural chambers. The ongoing Monitoring and Storage Project has had “very encouraging results midway through the project.”

In addition to depleted oil and gas chambers of the type studied by Dr. Jazrawi and the CO2 Monitoring and Storage Project, the volume of underground aquifers dwarfs the volume of underground oil and gas chambers, reported Gary Pope, the Texaco Centennial Chair in Petroleum Engineering. Moreover, due to its density and the composition of natural storage chambers, CO2-saturated water in underground aquifers would be unlikely ever to rise to the surface. “I think saline water sequestration is a very advanced and promising technology,” Pope added.

ChevronTexaco Business Development Director Luke O’Keefe agreed with Jazwari’s and Pope’s optimism. O’Keefe reported ChevronTexaco has had proven success with its gasification efforts. Gasification, as explained by O’Keefe, is the pre-combustion removal of CO2 from fossil fuels. The key to efficient gasification efforts, according to O’Keefe, is to locate the carbon sequestration sink near the fossil fuel extraction site.

“We think the global risks from slow-leakage are very low,” agreed Princeton University Professor of Ecology Stephen Pacala. Because of this, Pacala favored underground CO2 sequestration as opposed to deep ocean sequestration. Although the scientific questions regarding deep ocean sequestration have yet to be answered, “it is our view that ocean sequestration is dangerous from a public relations standpoint.” Underground storage, according to Pacala, avoids many of the public relations issues presented by deep ocean sequestration.

Voluntary Action Benefits

“For those who doubt the effectiveness of voluntary efforts vis-à-vis mandates,” stated Larisa Dobriansky, senior policy advisor for the U.S. Department of Energy, “the U.S. is the world’s technological leader regarding greenhouse gas science–and this has been achieved through voluntary efforts.”

“The President’s approach is that economic growth is the solution, not the problem,” Dobriansky added.

Public-private partnerships are essential to the success of voluntary climate change efforts, asserted Dobriansky, as are sectoral compacts similar to those propounded by the American Petroleum Institute. “API is doing outstanding work, without a doubt,” in taking effective voluntary steps to develop greenhouse gas abatement technologies, according to Dobriansky.

James M. Taylor is managing editor of Environment & Climate News.