Page 4 - FSUOGM Week 06 2021

FSUOGM COMMENTARY FSUOGM

BP, Rosneft work together

on climate goals

BP wants to help Rosneft clean up its image so it is not under pressure to sell

its 20% interest in the Russian oil giant

RUSSIA BP has agreed to work together with Russian sustainability goals,” the pair said on February
oil giant Rosneft, in which it owns nearly a 20% 5. Among the projects they will consider are
WHAT: stake, on reducing emissions, as it looks to bring renewables, carbon capture, utilisation and stor-
BP and Rosneft have its Russian activities in line with its green plans age (CCUS) and hydrogen production. They will
agreed to work together announced last year. also work together on developing methodologies
to reduce emissions. The UK major announced a drastic strat- and standards for carbon management, includ-
egy for responding to climate change last year, ing methane reduction initiatives and energy
WHY: announcing it would reduce its oil and gas efficiency applications.
Analysts and investors output by 40% over the coming decade, while “We’ve been partners with Rosneft from
have questioned whether expanding its renewable energy capacity to 50 many years now and we learn a great deal from
BP's shareholding in GW. Analysts and investors have said the compa- each other,” BP’s Looney said in a statement.
the Russian company is ny’s 19.75% shareholding in Russia’s largest pro- “That’s important, and I believe that this agree-
compatible with its green ducer is at odds with this strategy, although BP ment can be an important catalyst for progress.”
strategy. CEO Bernard Looney has repeatedly defended In contrast to BP’s lofty targets, Rosneft’s envi-
the shareholding. ronmental commitments are far more modest.
WHAT NEXT: The latest pact suggests BP wants to help Ros- BP aims to reduce its direct and indirect emis-
BP needs high-margin neft clean up its image, as both companies face sions by 35-40% by 2030, while Rosneft is only
oil assets to bankroll its pressure from increasingly climate-conscious targeting a 30% cut in the intensity of emissions
ambitious green energy investors. from production by 2035. Whereas BP is striving
plans. to become carbon neutral by 2050, Rosneft is yet
ESG in limelight to make a net-zero pledge.
The pair have agreed “to co-operate in identify- Even so, Russian companies, like their Euro-
ing and developing new low-carbon solutions pean peers, are facing heightened scrutiny over
and programmes that will support their shared their environmental credentials. Environmental,

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