…Intergovernmental body says stopping new oil wells are paths to avoid climate catastrophe
…With OPEC to control global oil by half by 2050, how far campaign go
…Investment decisions are driven by what’s profitable, not what’s best for the planet
Ben Eguzozie, in Port Harcourt
The International Energy Agency (IEA), an authority in global energy founded by Henry Kissinger, has thrown a bombshell talking about achieving a net-zero by 2050, that, on paths to avoiding climate catastrophe, the world should stop drilling new oil wells.
“Beyond projects already committed as of 2021, there are no new oil and gas fields approved for development in our pathway, and no new coal mines or mine extensions are required,” the IEA, said, in its new 227-page report regarding the Net-zero by 2050 campaign.
The Paris-based intergovernmental organization, put simply, declares: “There is no need for investment in new fossil fuel supply.” For the IEA, oil drillers, will have to rely on “existing assets.”
Keenly considered, the end of investments in new oil and gas fields by IEA means that some money could keep pouring into existing fields, as production centralizes in lower-cost and lower-carbon producers in the Middle East and North America.
Additionally, it appears quite preposterous considering that the poorer economies in Africa and large parts of Asia, Caribbean and Latin America are still largely commodity-dependent.
In Africa alone where, Nigeria, the continent’s biggest oil producer, is located, the new IEA suggested path severely counters the country’s ridiculous stuck with oil. Recently, the country’s oil company, Nigerian National Petroleum Corporation (NNPC) came up with announcement of a renewed vigour to pursue wasteful spending on oil search in the Sokoto Basin, the country’s North-East region, adjudged to be geographically contiguous with the Benue Trough where the country had reportedly previously searched for oil for several decades without success, spending some $340 million and an additional N27 billion in seismic expedition.
A report by the New Republic group says, IEA’s new campaign isn’t one coming from a group of lefty climate activists making the case for a rapid phaseout of fossil fuels, but a body founded by Henry Kissinger to provide a geopolitical counterweight to OPEC. Environmentalists don’t even contemplate that IEA is particularly friendly to their cause— even energy wonks within the climate change group regularly describe IEA scenarios as strictly underrating renewables.
Meanwhile, fossil fuel companies have pointed to IEA estimates as proof that their core business model can continue indefinitely. But now, the global intergovernmental body is pointing to policies more ambitious than some of the most ambitious climate plans on offer in Washington, D.C.
According to experts at Carbon brief.org, the scenario the IEA recommends to cap warming at 1.5 degrees Celsius (2.7 degrees Fahrenheit) involves getting oil investments in the next decade to roughly half of what they were between 2011 and 2020. In essence, they adduce the IEA renewables should overtake coal within five years to secure the 1.5 degrees Celsius goal. Under the IEA’s net-zero scenario, global oil demand would decline 75%, and “undiminished” gas—burned in plants not fitted with some kind of carbon-scrubbing device—would decline by 88% through 2050, along with 98% of persistent coal use. The remaining about one-fifth of fossil fuel usage by 2050 would largely power heavy and hard-to-decarbonize industries like steel, with solar and wind meeting 70% of energy demand. Overall, renewables would increase by well over 700%, with no internal combustion vehicles sold anywhere on earth by 2035, at which point wealthy economies will have power sectors run on clean energy.
Additionally, according to a report by corporate accountability.org, the IEA scenario appears a far cry from the ambiguous net-zero pledges put out by some of the world’s biggest polluting corporations, which foresee many decades of continued oil and gas demand and development before both eventually taper off at some imprecise point well in the future.
In Washington, the Biden administration has mounted the climate challenge largely as an investment and job creation opportunity for clean energy, though even its investment plans on that front remain riskily unsure. The American Jobs Plan would invest roughly 1 percent of gross domestic product in scaling up renewables and other green technology that the IEA recommends will be critical to meeting the goals outlined in the Paris Agreement.
Experts believe that the mere existence of this new IEA report contests the idea that calls to halt new fossil fuel development are the province of fringe environmentalists: such changes, according to its experts, are needed to meet the goals of the Paris Agreement.
Meanwhile, climate activists say, the report includes plenty of things that are controversial: namely, the widespread use of bioenergy and carbon capture and storage. But they all reach similar conclusions on fossil fuels, which is: start keeping so much of them in the ground, fast.
To the experts, what remains to be seen in the days ahead, is whether the results of the IEA’s net-zero study will be fully integrated into its gold standard “World Energy Outlook,” an annual report used by decision-makers around the world to direct trillions of dollars’ worth of public and private capital.
By 2050, the IEA predicts that OPEC would control half of world oil supplies. Without new fields to exploit, fossil fuel supplies would be expected to decline by around 4.5 percent per year, on average. How far then, can the campaign go? Besides, investment decisions are driven by what’s profitable, not what’s best for the planet. Accordingly, executives could continue pouring cash into projects that will see the world blow past two degrees Celsius of warming, unless there is new policy to render those investments unprofitable.
With Brent crude trading at $70 per barrel and Nigeria’s Bonny Light trading at above $65 per barrel, fossil fuel executives aren’t about to ditch new developments en masse just because the IEA says they should.