Oil Change International

Exposing the true costs of fossil fuels

A New Shade of Lipstick on Big Oil’s Climate Denial Pig

C: murdocke23

C: murdocke23

The history of Big Oil’s climate denial campaign is littered with slightly progressive sounding front groups trying to give the impression that the industry cares about climate change.

From the Global Climate Coalition; the Climate Council; the Global Climate Science Team to the Oil and Gas Climate Initiative, the industry has repeatedly tried to create an illusion that it’s taking climate change seriously while undermining any meaningful action.

Take the Climate Change Coalition, which was active in the nineties. It was no coalition of concerned citizens, but was made up of BP, Shell, Exxon and Texaco, and its aim was to derail climate action.

The newest manifestation is the Oil & Gas Climate Initiative (OGCI) which will announce its latest plans to solve climate change on Friday, November 4, the day the Paris Agreement comes into effect.

According to a press release, “the OGCI will announce details of the next phase in their collective action to reduce greenhouse gas emissions.”

So what is the OGCI?

Formed in 2014, the Initiative says it is “a CEO-led organization designed to catalyze practical action to reduce greenhouse gas emissions. It is currently made up of ten oil and gas companies that aim to lead the industry response to climate change.”

Those companies include BP; BG Group; Saudi Aramco; Shell and Statoil, among others.

The initial discussions were held at the World Economic Forum in Davos. “It carries the vision of Oil and Gas companies working together collaboratively and sharing best practices and technical solutions to address climate change and sustainable energy.”

The website for the OGCI was set up by Daniela Barat Head of Legal, at the World Economic Forum. She is an ex-tobacco lawyer.

The PR company handling the account is Edelman, one of the world’s largest PR companies. Although last year Edelman publicly stated that it will no longer work with coal producers and climate change deniers. This was in response to the company being caught “flat-footed” in 2014 when other major PR firms had taken a stance against climate denial. Edelman had also been caught setting up front groups in support of the proposed Energy East tar sands pipeline.

Meanwhile in the UK, the company has been criticized for providing services to the UK Task Force on Shale Gas, which has been panned by its critics for being pro-fracking.

The only good news from a climate perspective is that the OGCI does not include the biggest climate dinosaur of the lot: Exxon. I have written twice in the last week about Exxon’s climate denial campaign and its humiliating reserve write down.

But that is where the good news runs out.

It is not hard to find a fundamental flaw in the OGCI’s position. Oil companies must maximize shareholder return by drilling for oil and gas, which in turn causes climate change. So their core business is fundamentally at odds with climate change action.

OGCI members produce over one-fifth of global oil and gas production, and have a vested interest in making sure they carry on producing.

One of the companies is Saudi Aramco, the Saudi oil company, which states on its website, for example: “Our oil fields are some of the largest on the planet – and the world relies on us to manage them responsibly … Today, the production of this essential energy resource remains at the core of our business, and we supply more crude oil to the global economy than any other oil producer, producing nearly 1 in every 8 barrels of world oil production.””

While oil production remains at the “core” of its business,  Aramco is unlikely to lobby for any meaningful action on climate.

Take another company, Statoil. There is a global push to kick Big Oil out of the Arctic, a region where there are huge risks exploring for oil and where the effects of climate change are being very keenly felt.

Statoil talks about the need for climate change action but is heading further into the Arctic. In September this year, the Wall Street Journal reported that Statoil “was pushing deeper into the Arctic, shopping for Barents Sea drilling licenses in a bid to add resources and maintain output over the coming decades.”

Moreover BP and Shell, which often try and promote their progressive climate credentials, have both been found to be lobbying against climate action too:

In April last year, the Guardian reported how Shell had “successfully lobbied to undermine European renewable energy targets”. As far back as October 2011, the oil giant was lobbying the European Commission “to scrap the bloc’s existing formula for linking carbon-cutting goals with binding renewable energy laws.”

Nor is BP any better. In 2013, BP basically threatened the Commission that if it went ahead and regulated the importation of dirty tar  sands crude from Canada, or clamped down on dirty power plants and accelerated the introduction of renewable energy, then “energy-intensive industries, such as refining and petrochemicals” would “relocate outside the EU with a correspondingly detrimental impact on security of supply, jobs [and] growth.” The Commission later abandoned or weakened the key proposals.

Last year, a survey by the UK-based non-profit, Influence Map, concluded that BP was Europe’s “strongest advocate of dirty energy, opposing even mild measures to raise carbon trading prices.”

Thomas O’Neill, Influence Map’s research director said at the time: “BP has been consistently opposed to all the main forms of climate change regulation. There is very little positivity coming out of them and they are a board member of several obstructionist trade associations, some of which give a very dubious account of climate science.”

We are witnessing a new form of climate denial. As Seth Klein & Shannon Daub from the Corporate Mapping Project noted in September 2016. “Thankfully, the climate deniers have now mostly been exposed and repudiated… That’s the good news. The bad news is we face a new form of climate denialism — more nuanced and insidious, but just as dangerous.”

“In the new form of denialism, the fossil fuel industry and our political leaders assure us that they understand and accept the scientific warnings about climate change — but they are in denial about what this scientific reality means for policy and/or continue to block progress in less visible ways.”

And that is what the OGCI and its member companies are doing. In the run up to the Paris climate talks, the Guardian reported that “The heads of 10 major oil and gas companies have denied they are paying lip service to climate change initiatives while conducting business as usual.”

The oil industry is conducting business as usual but trying to tell you it is acting on climate change. With the OGCI, they are purely painting a new shade of lipstick on the industry’s climate denial efforts that have been going on for decades.

Comments (2)

  1. “Oil companies must maximize shareholder return by drilling for oil and gas,”

    The first half of that sentence is correct. The second is open to question.

    Drilling less will reduce demand. That means higher prices and higher valuations for reserves.

    It may well be true that oil companies will profit from being forced to produce less. They have tried to do that themselves since the days of the Texas Railroad Commission, with varying success.

    Having climate regulation put an effective cap on supply might be actually a very good thing for their profits.

    If true, that would not be without influence on their lobbying efforts.

  2. We are mistaken to think oil companies are in the energy delivery business. Rather they are in the business of promoting carbon combustion and immediately selling more.

    What a perfect business model – after combustion – carbon fuels must be immediately replenished.. The fuel line to the cylinder is the same as drilling crude to refinery. Each flow and replenishment involves revenue.

    Unlike solar and wind or even nuclear, carbon fuels are perpetual revenue generators. They will never cease, and will do anything to maintain their business model. “Nothing personal, just business”

    Thanks for this site. It’s wonderful . .

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