(Calgary) The fossil fuel industry is under increasing scrutiny for its contribution to climate change, but the president of the Canadian subsidiary of British oil giant Shell says oil and gas companies cannot be held solely responsible for the pace of the global energy transition.
Shell Canada President Susannah Pierce made the comments Thursday during an interview in Calgary, where hundreds of leaders and government officials from oil-producing countries around the world are arriving this weekend for the 24e World Petroleum Congress, which begins on Sunday.
The event, which last took place in Canada in 2000, is one of the world’s largest oil and natural gas conferences. Its theme this year is the energy transition and the industry’s carbon neutrality goals, and several industry heavyweights are expected to speak, such as Exxon Mobil CEO Darren Woods and the Saudi minister Energy.
Mme Pierce, who this week was named business leader of the year by the Canadian Chamber of Commerce, will also speak at the convention.
While Shell has its own carbon neutrality ambitions – the company is investing in electric vehicle charging, hydrogen, biofuels and wind and solar power, in addition to traditional oil and natural gas – Mme Pierce said the speed of global decarbonization depends on the transition of the entire economy, not just the fossil fuel sector.
“We are still a very largely fossil fuel-based economy, when you look at different sectors,” she said. The speed at which we can scale will be the speed at which each of these components moves together. »
Oil companies criticized
There has been renewed demand for traditional fossil fuels following Russia’s invasion of Ukraine last year, sparking global concerns about energy security. Oil companies posted record profits last year as commodity prices soared to unprecedented highs.
Faced with this growing demand, some companies have been criticized for prioritizing current profits over investments in long-term climate progress. Shell Canada’s parent company, for example, angered climate advocates earlier this year by abandoning plans to cut global oil production by 1% to 2% per year until the end of the decade.
The CEO of Suncor Energy, another Canadian oil and gas company, was also criticized by environmentalists and some politicians for comments suggesting Suncor had focused too much on the long-term energy transition versus renewable fuels and low emissions.
Rich Kruger told analysts during a Suncor conference call that the company needs to focus on current opportunities in the oil sands sector, where it is better positioned to “win.”
Although Mme While Pierce declined to comment specifically on Mr. Kruger’s statements or the political reaction to them, she emphasized that oil and gas companies provide a product on which the global economy depends.
“(If you are) a company that serves your customers who still demand a fossil energy source, it is very difficult not to provide your customers with the energy they demand,” she argued.
Mme Pierce added that the transition to a low-carbon economy would require government incentives throughout the value chain, particularly in fossil fuel-intensive industries like cement and steel manufacturing, maritime transport and aviation.
This is why she is concerned about the cap that the federal government wants to impose on emissions from the Canadian oil and gas sector, she explained. This measure should be unveiled later this fall.
Although oil and natural gas are Canada’s sector that emits the most greenhouse gases, Mme Pierce said a cap that penalizes the industry could impact its profitability and thus harm its ability to invest in low-carbon projects.
“I think when we look at decarbonization across the country, it needs to be consistent […] It must be a pan-Canadian decarbonization framework,” she said.
“I don’t think we should impose an emissions cap on just one sector. »