How the Aiming for Zero initiative is accelerating methane emissions reduction
Combating climate change is this century’s biggest and most-pressing challenge, and the oil and gas sector has a responsibility to play a leading role in solving the climate conundrum.
No one said the road to net-zero will be easy, and we won’t get there overnight. But the oil and gas industry can start making an immediate impact by tackling methane emissions. Possessing a much shorter atmospheric lifetime than CO2, methane also absorbs a larger amount of energy while it is in the atmosphere. This makes cutting methane emissions our greatest chance to yield meaningful immediate results in curbing global warming.
Aiming for Zero initiative
Last year in March the Oil & Gas Climate Initiative (OGCI) unveiled an all-in approach to tackling methane by establishing the Aiming for Zero initiative, which has set a goal for signatories to reach near zero methane emissions from their operated oil and gas assets by 2030. Similarly, signatories must also commit to avoiding methane venting and flaring, repairing detected leaks, reporting annually and transparently on methane emissions, and embracing technological innovation to supplement methane emissions estimates with more monitoring and measurement technologies.
Prior to the establishment of Aiming for Zero, the oil and gas sector had already been on a strong trajectory for eliminating methane emissions. Performance data from the OGCI for 2021 shows that member companies’ absolute upstream methane emissions have plummeted by 40% in four years. The volume of methane emission reduction is on the scale of about 800,000 metric tons/year, which is equal to about 3.9mn US homes’ electricity use in a year.
Equally encouraging is that there are other frameworks already that the Aiming for Zero initiative will supplement and work in conjunction with. Over 150 world leaders have committed their countries to the Global Methane Pledge to reduce methane emissions by at least 30% from 2020 levels by 2030, which could eliminate over 0.2˚C of warming by 2050. Similarly, combined with the Methane Guiding Principles, Oil and Gas Methane Partnership 2.0, Global Methane Alliance, and Global Methane Hub there is a robust set of frameworks and multi-stakeholder initiatives in place to ensure all sector participants have the resources, tools, support and guidance to tackle methane emissions immediately and effectively, and the Aiming for Zero initiatives provides the final piece of the puzzle.
In just one year, 19 oil and gas companies have joined the Aiming for Zero initiative as signatories. Furthermore, the initiative has seen a few dozen energy service companies, technology suppliers, oil and gas commodity traders, consultancies, business and trade associations, academic institutions, investment groups, non-governmental organisations, not-for-profit associations and financial institutions join as supporters.
Standout performers
It’s still early days for the Aiming for Zero initiative, but already it has launched a race to the top for sustainability among its members and several signatories have already been recognised for outstanding performance.
For instance, Neptune Energy in November received the United Nations Environmental Program’s Gold Standard status. The company already has one of the lowest methane intensities in the oil and gas sector at 0.02% compared to the industry average of 0.20%. It has also put in place a robust action plan to achieve its target of net zero methane emissions by 2030, while harnessing the latest technologies, eliminating routine flaring and committing to transparent reporting.
Similarly, signatory BP, achieved a world-first in March by becoming the first energy major in the US to verify the methane intensity of its entire US onshore portfolio of natural gas. Its natural gas has been independently audited and certified by methane certification provider MiQ.
Likewise, the Aiming for Zero initiative has made breakthroughs geographically with JGC Holdings Corp in March becoming the first Japanese company to join the initiative. This trailblazing engineering, construction and procurement specialist is likely to set off a domino effect in the region with more commitments expected to follow from other Asian market players.
A growing market for climate tech
As more and more oil and gas companies affirm their commitment to slashing methane, clear signals are being sent to climate tech firms that a growing market is developing for their technology. And investors are recognising this too, with a record $82bn invested in climate tech in 2022, while financial titans such as Blackrock CEO Larry Fink and Social Capital CEO Chamath Palihapitiya have both expressed optimism for the prospects of climate tech firms.
Grants and incentives are also being increasingly made available for methane emissions reduction. The US Inflation Reduction Act (IRA) allocates $1.5bn in grants for oil and gas companies taking steps to reduce their methane emissions. Similarly, in Canada the Alberta Methane Emissions Program (AMEP) allocates $17mn for technology innovation.
With investment pouring into climate tech firms, it is only natural that a race to bring down the cost of green premiums will spring up, making clean technologies more affordable and emerging as market-based solutions.
According to the International Energy Agency’s 2022 methane tracker 357mn mt of methane was emitted in 2021. Of this, about 80mn mt came from the oil and gas sector. Thus, if the entire oil and gas sector were to join the Aiming for Zero initiative and reach near zero it could eliminate roughly 23% of global human-caused methane emissions.
All signs point to the Aiming for Zero initiative continuing to build on its momentum from a strong first year and achieving major breakthroughs in the coming years. Where there is a will, there is a way, and the over 70 industry players that have committed to the Aiming for Zero initiative make it clear that the sector is determined to achieve its climate goals and taking the necessary steps to do so.