UK regulator calls on IEA to draw up global transition 'deal' for oil and gas

The International Energy Agency should help draw up a transition "deal" with the oil and gas industry globally -- of the kind adopted in the UK -- which could become the focus of global climate talks subsequent to this year's COP26, the head of the UK's Oil & Gas Authority said Sept. 9.

The global oil and gas industry, together with governments around the world, need a plan setting out responsibilities on the path to net-zero emissions, Andy Samuel told the Offshore Europe industry conference. He also suggested that the upcoming climate talks in Glasgow this year should focus on emissions from coal rather than oil and gas.

In March, the UK government and the country's oil and gas industry finalized a "transition deal" aimed at deploying the skills of the decades-old North Sea industry in shifting to clean energy, while ensuring supply from domestic sources for the country's remaining hydrocarbon needs, along with mitigations such as carbon capture and storage.

Samuel's comments come as the global oil and gas industry faces a new wave of ire from climate campaigners, emboldened by a controversial IEA "blueprint" published in May for reaching net-zero emissions by 2050 which involves a halt on investments in any new fossil fuel projects.

Alluding to the scenarios published by the IEA, Samuel said scenarios in themselves were insufficient without more detailed plans to transition away from oil and gas.

"I personally would like the IEA and others to start looking at a global deal for oil and gas in the way the UK has done," Samuel said. "People who are worried, which is all of us, do need to see not just scenarios, but actually a plan that is 1.5 degrees-compliant, that still brings in the investment required through the transition. And that needs to be a global deal."

Climate talks

The UK, a key member of the IEA's 30 major energy consumers and home to the North Sea's benchmark Brent crude, has so far resisted calls for a halt to new oil and gas licensing, citing the need for security of oil supplies and a stable transition. Norway, Western Europe's biggest oil and gas producer, has been more vocal in rejecting calls for an immediate halt to new upstream work, saying it will continue to support a profitable, but lower-carbon offshore industry for decades to come despite concerns about the impact on the climate.

Samuel said any global transition deal should not be the priority for the COP26 climate talks in Glasgow in November due to the greater urgency of tackling global coal dependence -- highlighted in continued large-scale coal use in Asia, but also recent moves by some European energy providers to source coal as a way of countering spiking gas prices.

"COP26 has clearly got a task to deal with coal first," Samuel said. "There's an alarming amount of investment still ongoing in coal -- the record-high forward month-ahead gas prices driving some switching to coal, which can't be good."

But a global transition deal with the oil and gas industry could be a task for the next round of climate talks, he said. "I'd love that to be a future target for the COP after COP26, but right now, the world's still got a big problem with coal," Samuel said.

The Paris-based IEA was founded in 1974 initially to address developed countries' dependence on Middle Eastern oil and to provide more accurate data gathering and planning capabilities, and oversee the creation of strategic oil stock reserves, but has since branched out to look at a wide range of energy issues and climate change.