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New net zero requirement for UK oil and gas industry
A revised strategy from the Oil & Gas Authority (OGA) has been submitted to the UK Parliament, featuring for the first time an obligation on the sector to support the UK’s net zero target.
Oil and gas currently meet about 75% of the UK’s energy consumption and official government forecasts expect the fossil fuels to remain a vital part of the UK’s energy mix for the foreseeable future. The revised strategy positions the UK Continental Shelf (UKCS) as a key enabler for the transition towards net zero carbon, with the onus on the oil and gas sector to step up efforts to reduce emissions from existing and new production, support game-changing carbon capture and storage (CCS) projects and help unlock clean hydrogen production.
As long as this demand exists, managing production and maximising value from the UKCS as cleanly and efficiently as possible is necessary for security of supply, to ensure an orderly energy transition, and to reduce reliance on hydrocarbon imports, states the OGA. This is especially important as some imports, such as LNG, has a carbon footprint more than twice that of UK-produced gas, it notes.
Alongside the direction set out in the strategy, the oil and gas industry is also making progress in commitments to reducing production greenhouse gas (GHG) emissions. As well as stewarding towards emission reductions, the OGA will track, monitor, benchmark and report on this overall emissions reduction, and published its first benchmarking report on emissions from flaring and venting earlier this year.
The OGA is working with industry and government to unlock net zero opportunities, and many in industry have already made real progress by taking action such as announcing targets for production emissions. The OGA’s analysis of Energy Integration illustrated the substantial overall net zero potential of the UKCS. Integration has the potential to make a possible 30% contribution towards the country’s overall net zero target, primarily through CCS projects and through CCS plus hydrogen production. Adding offshore renewables (wind, wave and tidal) could take that up to 60% of the abatement required in 2050, it claims.