Page 6 - NorthAmOil Week 17 2021

NorthAmOil COMMENTARY NorthAmOil

Big changes under Biden

for US oil and gas

US President Joe Biden’s push to prioritise the fight against

climate change means major changes for the country’s oil

and gas industry

US US President Joe Biden has made it clear since below 2005 levels by 2025. The US is currently
taking office in January that he will make cli- not even halfway to meeting that goal, with
WHAT: mate change mitigation efforts a priority. This Trump taking the country out of the Paris agree-
US President Joe Biden’s has major implications for the country’s oil and ment, only for it to be subsequently returned to
push to prioritise climate gas industry as it attempts to bounce back from it by Biden this year.
change mitigation years of low prices. And Biden’s latest moves While the new goal has been welcomed
efforts has significant mark a continuation – even an acceleration – of by environmental groups and various other
implications for oil and this trend, which oil and gas players will have to advocates of decarbonisation – a move that
gas. factor into their plans as they figure out how to increasingly includes national governments and
move forward. corporations – others have warned that achiev-
WHY: Last week, at a virtual international climate ing it will be an uphill struggle.
The Biden administration summit that he convened, Biden unveiled a In particular, power generation and trans-
is taking a far tougher new target for the US to cut its greenhouse gas portation are two sectors where significant
stance on greenhouse gas (GHG) emissions by 50-52% compared with changes would be required. According to the
(GHG) emissions than the 2005 levels by 2030. And this week, the US Environmental Protection Agency’s (EPA)
US had done previously. Senate, which is narrowly controlled by Biden’s annual inventory of GHG emissions, transpor-
Democrats, voted to reverse former President tation generates 29% of US emissions, followed
WHAT NEXT: Donald Trump’s efforts to relax regulations on by electricity generation at 25% and industry at
Obama-era regulations methane emissions from oil and gas operations 23%. Unsurprisingly, this stands to have a sig-
for methane emissions brought in by his predecessor, Barack Obama. nificant impact on oil and gas, with the picture
from oil and gas further complicated by the ongoing debate over
operations are set to be Major task the role of natural gas in the future energy mix.
re-instated. The new emissions-reduction commitment The energy industry has long argued that gas
represents a more than doubling of the US’ prior has a crucial role to play as a transition fuel – and
target under the 2015 Paris climate agreement, even a destination fuel. But Biden’s rhetoric and
when Obama pledged to cut emissions 26-28% early initiatives suggest a tougher stance, with

P6 www. NEWSBASE .com Week 17 29•April•2021