How the Oil and Gas Industry Is Contributing to Sustainability
Authors: Ben-Naceur Kamel 
Published: February 2019

Special Section: The Value and Future of Petroleum Engineering

In September 2015, the United Nations adopted 17 Sustainable Development Goals, addressing the global challenges facing humanity, including poverty, inequality, health, education, energy, climate, the environment, and prosperity. The organization’s 2030 Agenda for Sustainable Development is a continuation of its Eight Millennium Development Goals, with, among notable additions, the inclusion of energy access as a separate goal.

Energy is central to many of these goals through its linkage to the economy, education, health, the environment, and water. In 2019, nearly a billion people (more than 13% of the world population) do not have access to electricity, and 3 billion people lack access to clean cooking solutions, even within oil and gas producing/exporting countries.

Sustainable Development Goal no. 7 sets five ambitious objectives to be reached by 2030, including universal access to affordable, reliable, and modern energy services; a significant increase in the share of renewable energy in the global energy mix; and a doubling of the global rate of improvement in energy efficiency. Despite its importance in world energy supply, and its lower environmental footprint compared with coal, the oil and gas industry suffers from a poor public image, especially with the younger generation. Given the 2018 Intergovernmental Panel on Climate Change report that raised alarm bells about the consequences of just a small change in average global temperatures, how can the industry support the ambitious agenda of the UN’s sustainability goals?

Several organizations—including energy agencies, major oil and gas companies, and research and consulting groups—have developed energy supply and demand outlooks based on various scenarios. These outlooks (not forecasts) show the potential evolution of energy demand in the future (generally 2040/2050/2060), and the corresponding energy mix.

In these models, energy demand grows between 3% and 44% from now until 2040, while the share of oil and gas in the energy mix varies between 53% today and between 50–58% in 2040. Therefore, oil and, more importantly, natural gas will be important sources in meeting the world’s increasing energy demand going forward. Most of the outlooks, however, do not take into account the multiple requirements associated with the UN’s sustainable development goals.

In 2017, the International Energy Agency published an energy outlook that took into account universal access to energy, a reduction of emissions in line with the so-called Paris Agreement regarding climate change, and a major improvement in air quality, which is the cause of millions of premature deaths. In this “sustainable development scenario,” which does not require a major increase in energy-related investment compared with the baseline case, it is projected that global energy demand will continue to increase and, that by 2040, the oil and gas share of the global energy mix will still be 50%, representing the major enabler for universal energy access. The major emission-reduction wedges for this energy transition are: energy efficiency, renewables, CO2 capture/utilization/storage, and switching from coal to natural gas.