Page 4 - EurOil Week 17 2021

EurOil COMMENTARY EurOil

Lundin ships world’s first

certified carbon-neutral oil

Occidental claimed to have shipped the world’s first carbon-neutral oil in

January, but Lundin has delivered the first cargo certified as clean

NORWAY SWEDISH oil producer Lundin Energy has sold
what it says is the world’s first oil cargo certified as
WHAT: carbon neutral at the point of production to Italian
Lundin has delivered refiner Saras, the companies reported on April 26.
600,000 barrels of oil Lundin’s oil was produced at the Edvard Grieg
from Norway’s Edvard oilfield off Norway and was certified as having
Grieg field that has been neutral Scope 1 and 2 emissions, the company
independently certified said. Edvard Grieg emits only 3.8 kilograms of
as carbon neutral. CO2 emissions per barrel of oil equivalent (boe),
which is five times less than the global average,
WHY: according to Lundin. The residual 2,302 tonnes
The company wants of emissions from the 600,000-barrel cargo were
to market its products offset with a nature-based carbon capture pro-
as cleaner to ward off ject, the company said, without divulging details. carbon-neutral cargoes in Asia and Europe in
criticism from investors Lundin, which produces almost 153,000 bar- recent months. And this week, commodities
and customers over their rels of oil equivalent per day (boepd) of oil and trader Trafigura also sold the first carbon-neu-
carbon footprint. gas last year, has said it wants to make all its oil tral batch of naphtha to Brazilian petrochemicals
carbon neutral by 2025. It is also striving to make group Braskem.
WHAT NEXT: all its operations carbon neutral five years later. The cargo was shipped last week from Corpus
The company wants “We were the first company to have one of its Christi in Texas to Braskem’s facility via the Port
to market its products field’s carbon emissions independently certified of Aratu in Bahia, Brazil. CO2 emissions associ-
as cleaner to ward off as low carbon, and this certified carbon-neutral ated with the production and pipeline transport
criticism from investors transaction with Saras is the next stage in what of crude oil, its processing into naphtha and the
and customers over their we believe will become a key value differentiator transport of the 325,000 barrels of the fuel were
carbon footprint. for Lundin Energy,” Lundin CEO Nick Walker calculated by Trafigura, the trader said.
commented. “The provenance of a barrel and “Emissions will be offset through a combina-
how it is produced is increasingly important, as tion of efficiency measures which reduce emis-
society and industry require lower-carbon feed- sions, and surrender of high-quality carbon
stocks to achieve emissions reduction targets offsets,” Trafigura said.
and meet the goals of the Paris Agreement.” The trader added it had worked with the ves-
The carbon-neutral delivery “offers a proof of sel owner to minimise actual emissions from
point of where the crude market is heading and marine transport.
the potential value that can be realised through Lundin told Reuters that the cargo from
efficient, industry-leading emissions reduc- the Edvard Grieg field had been sold at a regu-
tions,” Walker said. lar price without attracting a premium. But its
Saras, which operates a 15mn tonne per year hope will be that future shipments will fetch a
(300,000 barrel per day) refinery in Sardinia, said higher price from buyers, eager to offset their
it was working on other initiatives to lower its own emissions.
emissions. It is aiming to expand biofuels pro- “This was a one-off sale, but we intend to
duction, improve its energy efficiency and pro- sell more carbon-neutral cargoes from Edvard
duce renewable energy and green hydrogen. Grieg, and from Johan Sverdrup once it is certi-
fied,” the company explained.
Carbon-neutral trade takes off The cargo was certified as neutral by Intertek
Oil and gas producers are looking to market Group, which tests, inspects and certifies that
their products as cleaner to ward off criticism products meet quality, safety, environmental
from investors and customers over their carbon and other standards for clients that include Car-
footprint. The latest carbon-neutral sale follows refour, ConocoPhillips and Unilever.
a similar one by US producer Occidental Petro- “This sale will carry the Intertek CarbonZero
leum in January to a refinery in India. But unlike Verified mark and details of this and all trace-
the Lundin deal, that transaction was not certi- able certifications are publicly listed for inves-
fied as neutral by a third party. tors, traders, regulators and other stakeholders,”
LNG suppliers have also sold a number of Intertek commented separately. ™

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