If the global energy transition is going to kick into high gear, oil and gas producers are going to have to step up.
This may sound counterintuitive, but as explained by Petrobras chief executive, Jean Paul Prates, the roadmap to decarbonisation and net zero needs to be supported by a strong collaborative effort between oil and gas producers and government policy makers.
“We must have a rational and gradual energy transition [that] does not leave anyone behind,” Mr Prates told a conference room filled to maximum capacity with delegates from the offshore energy industry at OTC 2024 in Houston in May.
He explained the Brazilian state-owned energy major’s plans for increasing oil production while promoting decarbonisation across the value chain, and they are looking to collaborate with suppliers to make this happen.
As evidence, read OSJ deputy editor Martyn Wingrove’s reports on recent tenders by Petrobras for offshore support vessels to support its robust plans for field development, decommissioning and drilling activities from 2024-2028. The energy major is looking to add newbuild OSVs that should be fitted with emissions-reducing technologies and propulsion such as LNG fuel, energy storage and hybrid diesel-electric propulsion. Biofuel usage will come into play, too, as Brazil is the second largest producer of renewable fuels in the world. This is because emissions from OSVs can account for at least 17% of CO2 emissions from drilling operations.
Mr Prates urged energy producers to reduce CO2 emissions from their production of fossil fuels and replace “King Oil” with locally produced low- and zero-carbon fuels that require less long-haul transportation.
“The Brazilian energy major plans to increase oil production while promoting decarbonisation”
While it still has ambitions to remain one of the world’s largest producers of low-carbon-intensive oil and gas, Petrobras plans go well beyond just increasing offshore oil and gas production, with its eye on solar farms, onshore and offshore wind, hydrogen production, biorefining and carbon capture and storage. The profits from oil will help investment in these alternative energy developments.
Over the next five years, Petrobras plans to invest some US$11.5Bn to lower the carbon emissions from operations, bolster its biorefining capacity and build its low-carbon businesses.
With dozens of FPSOs operating offshore, Petrobras has “the biggest CO2 injection in the world, and now we will be able to [inject] it from the bottom of the sea,” said Mr Prates.
With renewable energy accounting for half of the country’s energy — including 80% of its electricity produced by hydropower — Brazil has a carbon footprint up on most of the global community.
With an aspiration to reach carbon neutrality by 2050, Brazil’s progress will be front and centre when it hosts the United Nations Climate Change Conference (COP 30) in Belém in 2025.
“We are in the middle of the jump,” said Mr Prates, noting the phasing out of oil, while phasing in renewables. Anxious to overcome past scandals that have hung over the country’s oil and gas sector, Mr Prates welcomed collaboration. “Partnerships will be the order of the day.” Like Petrobras, other oil producers will need to lean into the clean energy transition if it is going to succeed.
© 2023 Riviera Maritime Media Ltd.