Assessment of oil and gas
companies’ climate strategy
European and US 9 largest oil and gas companies and the 5 largest National Oil Companies accounted for 35.9% of global production in 2022 and 45.4% of near-term expansion plans.
Some financial players think that it is essential to support these companies to transform their operations to allow a gradual reduction in hydrocarbon production in line with the goal of limiting global warming to 1.5°C and meeting the need for major investment in the deployment of renewable energy supplies. For others, oil and gas companies are structurally incapable of change and should be seen as a source of risk that must be managed or avoided through the use of restrictions or exclusions. In both cases, it is essential that financial actors base their decisions about oil and gas companies on facts.
To this end, Reclaim Finance has analyzed the climate strategies of the 14 largest NOCs, European and US oil and gas companies. We have selected a number of indicators that are fundamental to evaluating their measures in relation to meeting the objective of limiting global warming to 1.5°C. The aim is to answer three major questions: Does the company publish adequate information to assess its trajectory towards 2030? What is its capital expenditure plan? And what are its production and greenhouse gas emission targets?
Discover the main findings of our analysis and download below detailed briefings for each of the 12 oil and gas companies.
For information, a glossary is available here.
methodology
Because of the importance of cutting greenhouse gas emissions by about half over the decade, the analysis focuses on targets to 2030.
The IEA’s NZE scenario proposes a pathway to meet the world’s energy needs while having a chance to keep global warming below 1.5°C. In particular, this scenario projects:
- a halt to the development of new oil and gas production projects and liquefied natural gas (LNG) terminals.
- a decrease in oil and gas production of 21% and 18% respectively by 2030 compared to the 2022 level.
- A 2.1 x increase in total energy investments with a tripling of investments in sustainable energy, end-use and energy efficiency, so that by 2030, nine dollars are invested in these solutions for every dollar invested in fossil fuels.
The analysis compares the greenhouse gas emission projections with the International Energy Agency’s (IEA) Net Zero Emissions by 2050 (NZE) scenario and its Announced Pledges Scenario (APS), which follows a < 2°C trajectory.
key findings
None of the climate strategies are aligned with a 1.5°C scenario.
Analysis of the climate strategies of these nine oil and gas companies compared to the IEA’s Net Zero Emission by 2050 (NZE) scenario shows that their production plans, cash flows and energy mix do not allow them to follow a 1.5°C trajectory.
No halt to oil and gas expansion.
None of the companies have committed to stop oil and gas expansion, contrary to IEA projections and UN recommendations.
Production targets too high.
When publishing production targets, all companies aim to produce more oil and gas in 2030 than required in the IEA’s NZE scenario.
Insufficient investment in sustainable energy.
Investments in 2022 in renewable energy remain well below those in fossil fuels. U.S. companies are not reporting any investment in sustainable energy.
An energy mix in 2030 based on fossil fuels.
All of them forecast an energy mix in 2030 that would still include between 78% and more than 99% fossil fuels.
Exceeding the 1.5°C carbon budget in 2030.
All of them will emit more greenhouse gases in 2030 than allowed in a 1.5°C scenario.
A lack of transparency in climate strategies.
All have opaque climate strategies that contain little detailed data.
Climate strategies analysis
ADNOC’s production plans
By 2030, with its oil and gas resources from its fields under operation, under development and under evaluation, ADNOC’s production will be more than 20% higher than the level required to match the Net Zero Emissions by 2050 (NZE) scenario.
If ADNOC produces at the maximum of its targeted oil production capacities in 2030, the company will produce nearly 2.7x the NZE scenario production level.
ADNOC has not committed to stop developing new oil and gas projects while the National Oil Company (NOC) owns 5,589 mmboe of oil and gas from fields under development or evaluation as well as 4,267 mmboe of discovered hydrocarbon. Those could be extracted in the future if the company pursue its current climate strategy.
ADNOC’s expansion into Liquefied Natural Gas (LNG)
In addition to developing new fields, ADNOC is planning to construct a new LNG export terminal in the United Arab Emirates and is participating in a new LNG import terminal project in the Netherlands. Neither of these terminals is compatible with the NZE scenario.
ADNOC’s cash flow allocation
As ADNOC is a state-owned private group, the level of transparency regarding its consolidated financial results and the implementation of its climate strategy is very low. As a result, low-carbon investments already made are not published.
ADNOC aims to invest $15 billion between 2023 and 2027 in “low-carbon and new energies”, while $135 billion will be invested in oil and gas over the same period.
ADNOC’s energy mix
ADNOC renewable energy capacities are owned through its 24% stake in the renewable and hydrogen company Masdar. Masdar plans 100 GW gross installed and under construction renewable capacity by 2030.
ADNOC’s maximum renewable share of its energy supply mix will remain under 7% in 2030.
ADNOC’s greenhouse gas emissions
BP’s targeted carbon intensity in 2030 is 48% higher than in the IEA’s NZE, and 32% more than in the below 2°C Scenario. If it meets these targets and reduces its energy supply as per the IEA NZE and APS scenarios, BP will have overshot its share of the 2023-2030 carbon budget by 48% under the NZE, and by 32% under the APS.
BP’s production plans
In 2023, BP significantly decreased its oil and gas production reduction target, from a 40% reduction by 2030 to only a 25% reduction. If it meets this revised target, its production will be 25% higher than the level required to align with the NZE.
BP has not committed to stop developing new oil and gas projects beyond those already in development and reaching its 2030 production target will require the acquisition of new assets or the development of new fields, over and above its current short-term expansion plans.
BP’s cashflow allocation
For every dollar invested in its low carbon division in 2022, BP invested more than 14 dollars in oil and gas. Taking into account that BP’s low carbon division includes non-renewable energy sources, for every dollar invested in fossil fuels, less than seven cents was invested in sustainable renewable energies. In the same year, for every dollar invested in its low carbon division, more than 14 dollars were distributed to shareholders through dividends and share buyback.
BP’s low-carbon business is planned to amount to only 25% of capital expenditure byin 2030.
BP’s energy mix
BP aims to develop 50 GW of renewable capacity by 2030. BP’s operated net renewable capacity will reach 10GW at the end of this period, which would account for less than 5% of BP’s energy mix.
BP’s GHG emissions
BP’s targeted carbon intensity in 2030 is 48% higher than in the IEA’s NZE, and 32% more than in the below 2°C Scenario. If it meets these targets and reduces its energy supply as per the IEA NZE and APS scenarios, BP will have overshot its share of the 2023-2030 carbon budget by 48% under the NZE, and by 32% under the APS.
Chevron’s production plans
In 2030, with Chevron’s 2027 oil and gas production target and with the hypothesis that Chevron maintain its production at plateau by 2030, its production will be 62% higher than the level required to align with the NZE.
Chevron has not committed to stop developing new oil and gas projects beyond those already in development while the major owns 13,366 mmboe of discovered hydrocarbon resources that have not yet entered the field evaluation or development stage. From 2020 to 2022, Chevron spent on average 1.4 billion dollars per year on exploration, which makes it the 9th biggest investor in exploration.
Chevron’s cash flow allocation
Meanwhile in 2022, Chevron allocated 15.3 billion dollars to oil and gas, including 12.5 billion to oil and gas exploration and production, and did not report investments dedicated to sustainable renewable energy.
Chevron’s energy mix
Chevron does not report any renewable sustainable energy target by 2030.
Chevron’ greenhouse gas emission
Chevron’s targeted carbon intensity in 2030 is 39% higher than in the IEA’s NZE, and 24% more than in the below 2°C scenario. If it meets these targets and reduces its energy supply as per the IEA NZE and APS scenarios, Chevron will have overshot its share of the 2023-2030 carbon budget by 39% under the NZE, and by 24% under the APS.
ConocoPhillips’ production plans
ConocoPhillips does not publish an oil and gas production target. In 2030, if ConocoPhillips maintains its 2023 oil and gas production target at plateau, its production will be 71% higher than the level required to align with the NZE.
ConocoPhillips has not committed to stop developing new oil and gas projects beyond those already in development while ConocoPhillips owns 7,988 mmboe of discovered hydrocarbon resources that have not yet entered the field evaluation or development stage. From 2020 to 2022, ConocoPhillips spent on average US$867 million per year on exploration, which makes it the 14th biggest investor in exploration.
ConocoPhillips cash flow allocation
Meanwhile in 2022 ConocoPhillips allocated US$10.1 billion to oil and gas and did not report investments dedicated to sustainable renewable power.
In its 2023 capital expenditure plan, ConocoPhillips does not report any investment dedicated to sustainable renewable power either.
ConocoPhillips’ energy mix
ConocoPhillips does not report any renewable sustainable energy target by 2030.
ConocoPhilipps’ greenhouse gas emission
ConocoPhillips’ 2030 decarbonization intensity targets are only for scope 1 and 2 emissions, without any information on scope 3 emissions. Due to the lack of transparency, it is not possible to rigorously calculate ConocoPhillips future GHG emissions.
Equinor’s production plans
Equinor aims to keep its oil and gas production relatively steady up to 2030, around 2,000 kboe per day. If it meets this target, its production will be 61% higher than the level required to align with the NZE.
Equinor has not committed to stop developing new oil and gas projects beyond those already in development while the Norwegian company owns 3,203 mmboe of discovered hydrocarbon resources that have not yet entered the field evaluation or development stage. From 2020 to 2022, Equinor spent on average 1.2 billion dollars per year on exploration, which makes it the 11th biggest investor in exploration.
Equinor’s cash flow allocation
In 2022, Equinor allocated 9.5 billion dollars to oil and gas, including 8.3 billion dollars to upstream activities. Meanwhile, Equinor invested 298 million dollars in its renewable and energy solutions business line.
For every dollar invested in “renewable energy” in 2022, Equinor invested more than 32 dollars in oil and gas. For every dollar invested in “renewable energy” in 2022, more than 29 dollars were distributed to shareholders through dividends and share buyback.
Equinor plans to increase its gross CAPEX by 2025 and 2030 compared to 2022 level, with an increasing share of gross CAPEX dedicated to renewable and low carbon energy to 30% of its gross CAPEX by 2025 and 50% by 2030, while it was only 4% in 2020 and 11% in 2021.
Equinor’s energy mix
Due to its capital expenditure strategy, Equinor aims to have a renewable capacity of 14 GW by 2030. Its strategy relies on an acquisition strategy of assets and companies. Equinor’s maximum renewable share of its energy mix would remain under 6% in 2030.
Equinor’s greenhouse gas emissions
Equinor’s targeted carbon intensity in 2030 is 21% higher than in the IEA’s NZE, and 9% more than in the below 2°C scenario. If it meets these targets and reduces its energy supply as per the IEA NZE and APS scenarios, Equinor will have overshot its share of the 2023-2030 carbon budget by 21% under the NZE, and by 9% under the APS.
ENI’s production plans
Eni plans to increase its oil and gas production to 1,900 kboe per day, of which 40% oil and 60% gas, and to maintain production at a plateau until 2030. If the Italian major achieves this target, its production will be 71% above the level required to match the NZE.
Eni has not committed to stop developing new oil and gas projects beyond those already under development, while the major has 3,263 mmboe of discovered hydrocarbon resources that have not yet entered the field appraisal or development phase. In addition, between 2021 and 2023, Eni invested an average of $1 billion a year in oil and gas exploration, making it the 14th largest investor in this segment of the value chain.
ENI’s cash flow allocation
For every euro invested in “Plenitude” business line – its low carbon division – in 2022, Eni invested more than 15 euros in oil and gas. Taking into account that Eni’s “Plenitude” division includes non-renewable energy activities, such as gas marketing and retail that are still its main activities, for every euro invested in fossil fuels, less than seven cents were invested in sustainable renewable energies.
From 2023 to 2026, Eni forecasts slightly more than €9 billion of capital expenditure per year. Eni will invest €6 billion to €6.5 billion per year in its upstream activities, including €2.1 billion in exploration, while €1.65 billion per year will be dedicated to renewable energy. These targets represent a three to four-fold increase of its renewable capital expenditures by 2026, however it still represents less than 20% of its investments planned.
ENI’s energy mix
Eni aims to develop sustainable renewable energy, whose capacity will increase from 2.2 GW today to more than 7 GW in 2026 and double to 15 GW by 2030. Eni’s maximum sustainable renewable share of its energy supply mix would remain under 7% in 2030.
ENI’s greenhouse gas emissions
Eni’s targeted carbon intensity in 2030 is 22% higher than in the IEA’s NZE, and 9% more than in the below 2°C scenario. If it meets these targets and reduces its energy supply as per the IEA NZE and APS scenarios, Eni will have overshot its share of the 2023-2030 carbon budget by 22% under the NZE, and by 5% under the APS.
ExxonMobil’s production plans
In 2030, with ExxonMobil’s 2027 oil and gas production target and with the hypothesis that ExxonMobil will maintain its production at plateau by 2030, its production will be 39% higher than the level required to align with the NZE.
ExxonMobil has not committed to stop developing new oil and gas projects beyond those already in development while the major owns 11,411 mmboe of discovered hydrocarbon resources that have not yet entered the field evaluation or development stage. From 2020 to 2022, ExxonMobil spent on average US$1.4 billion per year on exploration, which makes it the 8th biggest investor in exploration.
ExxonMobil’s cash flow allocation
In 2022, ExxonMobil allocated US$22.6 billion to oil and gas, including US$17.0 billion to oil and gas exploration and production, and did not report investments dedicated to sustainable renewable energy.
ExxonMobil’s energy mix
ExxonMobil does not report any renewable sustainable energy target by 2030.
ExxoMobil’s greenhouse gas emissions
ExxonMobil’s 2030 decarbonization intensity targets are only for scope 1 and 2 emissions, without any information on scope 3 emissions. Due to the lack of transparency, it is not possible to rigorously calculate ExxonMobil’s future GHG emissions.
QatarEnegy’s production plans
By 2030, with its oil and gas resources from its fields under operation, under development and under evaluation, QatarEnergy’s production will be 20% higher than the level required to match the Net Zero Emissions by 2050 (NZE) scenario.
QatarEnergy has not committed to stop developing new oil and gas projects while the National Oil Company (NOC) owns 15,835 mmboe of oil and gas from fields under development or evaluation as well as 22,873 mmboe of discovered hydrocarbon. Those could be extracted in the future if the company pursues its current climate strategy.
QatarEnergy’s expansion into Liquefied Natural Gas (LNG)
In addition to developing new fields, QatarEnergy is constructing and plans to construct new LNG export terminal in the United States and in Qatar. QatarEnergy is participating in a new LNG import terminal project in Pakistan. Neither of these terminals is compatible with the NZE scenario.
QatarEnergy’s cash flow allocation
As QatarEnergy is a state-owned private group, the level of transparency regarding its consolidated financial results and the implementation of its climate strategy is very low. As a result, we lack information to analyze its investment strategy.
QatarEnergy’s energy mix
QatarEnergy aims to have a renewable capacity of 3 GW by 2030. QatarEnergy’s maximum renewable share of its energy mix would remain under 1% in 2030.
QatarEnergy’s greenhouse gas emissions
QatarEnergy’s 2030 decarbonization intensity targets are only for scope 1 and 2 emissions, without any information on scope 3 emissions. Due to the lack of transparency, it is not possible to rigorously calculate QatarEnergy’s future GHG emissions.
Repsol’s production plans
Repsol plans to increase its oil and gas production to 620 kboe per day by 2025 and stated that it will maintain this level of production by 2030. If it meets this target, its production will be 68% higher than the level required to align with the NZE.
Repsol has not committed to stop developing new oil and gas projects beyond those already in development while the Spanish company owns 1,403 mmboe of discovered hydrocarbon resources that have not yet entered the field evaluation or development stage.
Repsol’s cash flow allocation
Repsol allocated €3.2 billion to oil and gas, including €2.1 billion to oil and gas upstream activities. Meanwhile, Repsol invested €762 million dollars in renewable energy.
For every euro invested in renewable energy in 2022, Repsol invested more than 4 euros in oil and gas. For every euro invested in renewable energy in 2022, more than 3 euros were distributed to shareholders through dividends and share buyback.
Repsol plans to invest in average €3.8 billion per year from 2021 to 2025, including €2.6 billion in oil and gas and €1 billion in low carbon generation that include renewables energy as well as CCGT. Repsol’s renewable energy development should not represent more than a quarter of the group’s CAPEX by 2025.
Repsol’s energy mix
Repsol aims to have a renewable capacity of 6 GW by 2025 and 20 GW by 2030. Its strategy relies on an acquisition strategy of assets and companies. Repsol’s maximum renewable share of its energy supply mix would remain under 22% in 2030.
Repsol’s greenhouse gas emissions
Repsol’s targeted carbon intensity in 2030 is 30% higher than in the IEA’s NZE, and 16% more than in the below 2°C scenario. If it meets these targets and reduces its energy supply as per the IEA NZE and APS scenarios, Repsol will have overshot its share of the 2023-2030 carbon budget by 30% under the NZE, and by 16% under the APS.
Saudi Aramco’s production plans
By 2030, with its oil and gas resources from its fields under operation, under development and under evaluation, Saudi Aramco’s production will be 6% higher than the level required to match the Net Zero Emissions by 2050 (NZE) scenario.
If Saudi Aramco produces at the maximum of its targeted oil production capacities in 2030, the company’s production will overshoot the NZE scenario production level by nearly 23%.
Saudi Aramco has not committed to stop developing new oil and gas projects while the National Oil Company (NOC) owns 17,693 mmboe of oil and gas from fields under development or evaluation as well as 16,009 mmboe of discovered hydrocarbon. Those could be extracted in the future if the company pursues its current climate strategy.
Saudi Aramco’s cash flow allocation
Saudi Aramco does not disclose its past and future investments in sustainable energy. In 2022, 78% of Saudi Aramco’s investments were dedicated to oil and gas exploration and production.
Saudi Aramco’s energy mix
Saudi Aramco aims to have a renewable capacity of 12 GW by 2030. Saudi Aramco’s maximum renewable share of its energy mix would remain under 1% in 2030.
Saudi Aramco’s greenhouse gas emissions
Saudi Aramco’s 2030 decarbonization intensity targets are only for scope 1 and 2 emissions, without any information on scope 3 emissions. Due to the lack of transparency, it is not possible to rigorously calculate Saudi Aramco’s future GHG emissions.
Shell’s production plans
Shell plans to maintain its oil production at 2022 levels until 2030and a m ix composed of 45% of oil and by 55% of gas in 2030. If it meets this target, its production will be 35% higher than the level required to align with the NZE.
Shell has not committed to stop developing new oil and gas projects beyond those already in development while the major owns 7,544 mmboe of discovered hydrocarbon resources that have not yet entered the field evaluation or development stage. From 2020 to 2022, Shell spent on average 2.3 billion dollars per year on exploration, which make it the 3rd biggest investor in exploration.
Shell’s cash flow allocation
In 2022, Shell allocated 21.1 billion dollars to oil and gas, including 8.1 billion to oil and gas upstream activities. Meanwhile, Shell invested 298 million dollars in its renewable and energy solutions business line. For every dollar invested in its “Renewables & Energy solutions” division in 2022, Shell invested more than 6 dollars in oil and gas. Taking into account that Shell’s “Renewables & Energy solutions” division includes non-renewable energy sources, for every dollar invested in fossil fuels, less than 16 cents was invested in sustainable renewable energies. For every dollar invested in its “Renewables & Energy solutions” division in 2022, more than 7 dollars were distributed to shareholders through dividends and share buyback.
In 2023, Shell’s plans 23 to 27 billion dollars investment, including 2 to 4 billion dedicated to the “Renewables & Energy solutions” business line. Although this is a significant increase from 2022 levels, it amounts to 12% of its overall cash capital expenditure which in turns, means that most of its investments will still be going to fossil fuels.
Shell’s energy mix
Shell indicates it plans to provide electricity from renewable sources to 50 million households by 2030. Considering that Shell reaches that goal and that Shell’s renewable production is dedicated to the developed markets, Shell’s maximum renewable share of its energy supply mix would remain under 22% in 2030.
Shell’s greenhouse gas emissions
Shell’s targeted carbon intensity in 2030 is 40% higher than in the IEA’s NZE, and 25% more than in the below 2°C scenario. If it meets these targets and reduces its energy supply as per the IEA NZE and APS scenarios, Shell will have overshot its share of the 2023-2030 carbon budget by 40% under the NZE, and by 25% under the APS.
TotalEnergies’ production plans
In 2030, with TotalEnergies’ current oil and gas production target, its production will be more than 40% higher than the level required to align with the NZE.
TotalEnergies has not committed to stop developing new oil and gas projects beyond those already in development while the major owns 7,544 mmboe of discovered hydrocarbon resources that have not yet entered the field evaluation or development stage. From 2020 to 2022, TotalEnergies spent on average 1 billion dollars per year on exploration, which make it the 13th biggest investor in exploration.
TotalEnergies’ cash flow allocation
In 2022, TotalEnergies allocated 12.2 billion dollars to oil and gas, including 10 billion to oil and gas exploration and production. Meanwhile, the French major invested 4 billion dollars in “integrated gas, renewable and power (iGRP)” business line.
For every dollar invested in iGRP division in 2022, TotalEnergies invested more than 3 dollars in oil and gas. Taking into account that TotalEnergies’s iGRP division includes non-renewable energy sources, for every dollar invested in fossil fuels, less than 33 cents was invested in sustainable renewable energies. For every dollar invested in its iGRP division in 2022, more than 4 dollars were distributed to shareholders through dividends and share buyback.
By 2030, TotalEnergies aims to invest 5.3 billion dollars per year in “low-carbon energies” that include integrated power and new molecules while 4.5 billion dollars per year will be invested in new oil and gas projects, including LNG projects.
Higher than 2022 levels, ”low carbon energies” future investments will still represent less than a third of its capital expenditure.
TotalEnergies’ energy mix
TotalEnergies aims to have a gross renewable capacity of 35 GW by 2025 and 100 GW by 2030, that represents a net renewable capacity of 23 GW and 67 GW respectively. Its strategy relies on an acquisition strategy of assets and companies. TotalEnergies’ maximum renewable share of its energy supply mix will remain under 13% in 2030.
TotalEnergies’ greenhouse gas emissions
TotalEnergies’ targeted carbon intensity in 2030 is 20% higher than in the IEA’s NZE, and 7% more than in the below 2°C scenario. If it meets these targets and reduces its energy supply as per the IEA NZE and APS scenarios, the French major will have overshot its share of the 2023-2030 carbon budget by 20% under the NZE, and by 7% under the APS.
