A report released by an environmental and human rights organisation reveals that 96 percent of the oil and gas industry is expanding despite “Net-Zero” climate pledges.

Despite pledges taken at the annual Conference of the Parties of the UNFCC (COP) to reduce reliance on fossil fuels and re-direct financing towards a transition to clean energy, the gap between climate rhetoric and reality is dangerously wide, according to a report unveiled at COP27 - the US NGO Oil Change International.

The report states that within the next few years, several multinational companies are planning to open new gas and oil production sites. 

New fossil fuel projects approved, or in the process of being approved between 2022 and 2025, could lead to 70 billion tonnes of CO2 being emitted into the atmosphere over the course of their operation - equivalent to 17 percent of the world’s remaining 1.5°C carbon budget.

At COP26 in November last year, 34 governments and five development banks signed a joint commitment on “International Public Support for the Clean Energy Transition” (the Glasgow Statement) to end public finance for new fossil fuel exploration and production overseas by the end of 2022 and, instead, prioritise financing for clean energy. 

However, watered-down language such as phase-out of inefficient fossil fuel subsidies (rather than all fossil fuel subsidies) and phasedown (rather than phase-out) of unabated coal power, has provided loopholes in promises made and allowed the fossil fuel industry to continue expanding, particularly at the hands of the world's largest advanced economies.

In late June this year, G7 environment, climate and energy ministers added new loopholes to their climate pledges in their May 2022 Communique, stating that their commitment to support investments in liquefied natural gas (LNG) is “appropriate as a temporary response” to Russia’s war in Ukraine. 

Soon after the May meeting, Japan claimed it could continue financing upstream oil and gas projects and Germany’s Chancellor Scholz stated that Germany wants to “intensively” pursue gas projects in Senegal. 

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In addition to watered-down language in climate pledges, according to Oil Change International, nearly half of all Glasgow signatories “either have no policy restricting gas funding or policies that still allow full or partial support for gas exploration and production”. 

Earlier this month, North Rhine-Westphalia-based non-profit environmental and human rights organisation Urgewald, alongside 50 NGO partners, released their yearly Global Oil & Gas Exit List - a public company-level database that covers 901 oil and gas companies, which account for 95 percent of global oil and gas production.

The report revealed that 96 percent of the oil and gas industry is expanding and many financial institutions and banks are continuing to make related investments even when many have signed up to “Net-Zero” pledges.

Urgenwald’s Director Heffa Schuecking told journalists at COP27 that the group found new fossil fuel projects in 48 out of Africa’s 54 countries. She said that these projects can be traced back to 200 companies, the majority of which are headquartered in China, Europe and the United States.

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Just after the end of COP26 last year, the US, the largest polluter in the world, held an auction for new fossil fuel development leases in an area in the Gulf of Mexico twice the size of Florida.

According to a report called “the Fossil Fuelled 5” released by Oil Change International and four other environment NGOs, the US is planning to expand oil and gas production more than any other country by 2030 - 17 percent expansion of oil and 12 percent of gas.

The United Kingdom pledged over $35 billion in support of fossil fuel production and consumption during the Covid-19 pandemic – 59 percent of all energy-related funding commitments over this period. 

For Canada, the Fossil Fuelled 5 report forecasts an increase of 18 percent for gas production and 17 percent for oil above 2019 production levels by 2040 - a decade before the country is supposed to reach net zero. 

Since joining the Glasgow Financial Alliance for Net-Zero (GFANZ) last October, the Royal Bank of Canada (RBC) financed fossil fuel companies to the tune of more than $9.2 billion and over $7 billion in the first three quarters of 2022, according to grassroots environmental organisation Stand.earth.

Despite public commitments to help Canada achieve its national climate goals, RBC struck deals with companies like TC Energy, ExxonMobil, Chevron, and Aramco. 

Another G7 country, Italy, still shows no sign of implementing the Glasgow Statement with one month to go until the end of 2022 .

Simone Ogno, a finance and climate campaigner at ReCommon, an association that fights against the abuse of power and the looting of territories, said: "Through its export credit agency SACE, Italy has become the 1st European fossil fuel financier, enabling the development of strategic oil and gas projects for the Russian Federation, not to mention refineries in Egypt and LNG projects in Mozambique."

Despite some breakthroughs at this year's COP27, such as the development of a "loss and damages" fund for developing countries, the majority of signatories of the Glasgow Statement have yet to turn their pledge into action as they continue to eye fossil fuel investments and focus on filling the energy supply gap created by Russia-Ukraine conflict. 

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Source: TRTWorld and agencies