Latest news: ESG in oil & gas

Petrobras is challenging regulatory demands to conduct impact studies on indigenous communities for its proposed offshore drilling project near the Amazon River, reported Reuters.   

The state-run oil company’s chief exploration and production officer, Joelson Mendes, stated during a news conference on quarterly earnings that the studies were not legally required at this stage of the licensing process. “Petrobras will not do these studies at this stage of the licensing process, because they are not legal,” Mendes was quoted by the publication as saying.   

Brazilian environmental agency Ibama has insisted on these studies before it will consider Petrobras’ appeal for a drilling licence in the Foz do Amazonas basin. However, Mendes expects intervention from Brazil’s solicitor general, believing the request for new studies to be “not adequate at this point in the licensing process”.   

This stance could escalate tensions with the regulator, which previously denied a drilling licence due to potential impacts on indigenous groups and the coastal biome.  

The Foz do Amazonas basin is part of the Equatorial Margin and is viewed as a highly promising area for oil exploration, sharing geological similarities with fields in nearby Guyana where ExxonMobil is active. The licensing delays in this region are compounded by potential production impacts due to a labour strike at Ibama, which Mendes warned could hinder Petrobras’ operational expansion.  

Amidst these challenges, Petrobras’ CEO has offered to resign, with the government preparing to appoint Magda Chambriard, former head of Brazilian oil and gas regulator ANP, as the new CEO.   

The Australian Government has released its Future Gas Strategy, putting natural gas at the centre of its plans to reach net zero by 2050. Madeline King, Australia’s Minister for Resources, launched the document on 9 May, drawing criticism from some environmental groups.  

Although the strategy begins by noting that “Australia is committed to supporting global emissions reductions to reduce the impacts of climate change and will reach net zero emissions by 2050”, part of the strategy pushes Australia to obtain “new sources of gas supply” as they “are needed to meet demand during the economy wide transition” to net zero.   

King said: “Ensuring Australia continues to have adequate access to reasonably priced gas will be key to delivering an 82% renewable energy grid by 2030, and to achieve our commitment to net-zero emissions by 2050. The strategy makes it clear that gas will remain an important source of energy through to 2050 and beyond, and its uses will change as we improve industrial energy efficiency, firm renewables and reduce emissions. 

“But it is clear we will need continued exploration, investment and development in the sector to support the path to net zero for Australia and for our export partners, and to avoid a shortfall in gas supplies.” 

While one of the core principles of the strategy is that gas use should move towards lower-emission technologies including carbon capture and hydrogen usage, some feel that it does not go far enough to enable Australia to reach its net-zero goals in a timely manner.  

Dr Jennifer Rayner of the Climate Council told The Guardian that the strategy was “a regressive echo of the past”, noting: “Today’s announcement is more Back to the Future than Future made in Australia. Australia is already using less gas, so the suggestion we need more of it sounds like Scott Morrison’s ‘gas led recovery’, not Anthony Albanese’s ‘renewable energy superpower’.” 

Also timed to coincide with Deaf Awareness Week, a report from the Lending Standards Board flags up progress made by UK banks and lenders over the last 12 months in offering better accessibility support to deaf customers. 

In the UK, one in five adults are deaf, have hearing loss, or tinnitus. Hearing loss affects more than 40% of people over 50 years old and 70% of people over 70. LSB research has highlighted the challenges deaf people face when accessing financial services. 

The LSB’s latest report reveals that progress has been made in a number of areas including: 

• The availability of remote-access British Sign Language (BSL). This is now offered by 73% of surveyed LSB registered firms, up from 55% in 2023. 
• Access to lip speaker services increasing from being available at 36% of surveyed registered firms to 45%; 
• The availability of note takers, rising from being offered at just 9% of surveyed registered firms in 2023 to 45% in 2024 
• Enhancements to firms’ digital services, with online BSL translation available through 18% of surveyed registered firms in 2024, up from 9% in 2023. 

The incoming Dutch coalition government said on Thursday that it will aim to expand offshore natural gas extraction and nuclear energy production to reduce the Netherlands’ dependence on “unreliable countries”, according to Reuters. 

In the draft coalition pact seen by Reuters, the government said it would “do as much as possible” to stick to any international climate goals it had already agreed to, but it would not add any national restrictions on top of them. 

Dutch energy security has been a point of focus for the four political parties in the prospective government, following the challenges the country has faced from losing access to Russian gas after the start of the Ukraine war in 2022. 

The draft pact said new “long term contracts will be struck for natural gas in order to build reserves of gas and critical commodities”. 

Production at the large gas field under the Dutch province of Groningen will remain shut, but “gas production in the North Sea will be scaled up”. 

Japanese companies Inpex and JERA have initiated a joint study to evaluate the potential of a Japan-Australia CCS value chain. The collaboration aims to explore the viability of capturing CO₂ emissions in Japan and securely storing them in Australia.  

INPEX and JERA will cover the entire CCS value chain, including separation technologies, transport methods, and the conditions required for shipping and receiving CO₂. INPEX brings to the table its expertise in CCS technologies and business development. In 2022, INPEX, alongside TotalEnergies CCS Australia and Woodside Energy, was granted a greenhouse gas storage assessment permit in Australia’s Bonaparte Basin. 

With JERA, INPEX hopes to contribute to the development of a worldwide CCS value chain and the shift towards decarbonisation.  

JERA’s participation is driven by its interest in capturing carbon from its operations in Japan and seeking storage solutions abroad, particularly in regions with large storage capacity potential. Last month, JERA formed a partnership with Petronas CCS Solutions, a unit of Malaysian oil and gas company Petronas, to assess a CCS value chain, which involves capturing CO₂ in Japan for storage in Malaysia.   

In March last year, JERA signed an agreement with Chevron New Energies, a division of Chevron USA, to explore CCS collaborations in the US and Australia.  

JERA is aiming to attain net-zero CO₂ emissions from its domestic and international operations by 2050 under the JERA Zero CO2 Emissions 2050 initiative.  

Indonesian Government-backed oil company Pertamina and ExxonMobil are set to conduct appraisal drilling for a CCS hub in Indonesia, reported Reuters.   

This initiative aligns with Indonesia’s strategy to utilise its depleted oil and gas reservoirs and saline aquifers for storing CO₂, with the potential capacity for hundreds of gigatonnes.  

During the Indonesia Petroleum Association (IPA) annual conference, the companies signed an agreement outlining preliminary work to design a commercial model for the Asri Basin Project CCS hub.   

Pertamina Hulu Energi CEO Awang Lazuardi said: “Pertamina Hulu Energi and ExxonMobil will carry out appraisal drilling in order to collect data, which will later become a reference for the development of the hub.”   

A joint study by Pertamina and ExxonMobil revealed that the Asri basin, located in Pertamina’s Offshore South East Sumatra block, could store up to three gigatonnes of carbon dioxide and would necessitate an investment of approximately $2bn (Rp31.82trn). 

In addition to the appraisal drilling plans, Pertamina and ExxonMobil have entered into a framework agreement with South Korea’s KNOC. Pertamina CEO Nicke Widyawati stated that this partnership allows KNOC to join the project and inject emissions into the facility.  

The CCS initiative comes after Indonesia launched its first oil and gas auction of the year, offering five blocks to stimulate exploration and address the country’s declining production.