Ten of the world's biggest oil companies have created a fund to invest $1 billion in technologies that would reduce carbon emissions from oil and natural gas. The announcement by the Oil and Gas Climate Initiative (OGCI) — a group that comprises 10 companies that jointly account for nearly 20 percent of oil and gas produced in the world — was made the same day the Paris climate agreement, which seeks to prevent a catastrophic rise in global temperatures, came into effect.
In a statement released Friday, the OGCI said the funds would be used to develop technologies that will capture and store carbon emitted when natural gas — a potent greenhouse gas source — is burned, as well as to reduce overall methane emissions from the global oil and gas industry "in order to maximize the climate benefits of natural gas."
In addition, the OGCI said it will also "work closely" with auto manufacturers to increase the efficiency of vehicles.
"The creation of OGCI Climate Investments shows our collective determination to deliver technology on a large-scale that will create a step change to help tackle the climate challenge," the group said in the statement. "We are personally committed to ensuring that by working with others our companies play a key role in reducing the emissions of greenhouse gases, while still providing the energy the world needs."
However, given that the fund — which, at an yearly expenditure of $100 million, accounts for just 0.1 percent of the companies' current yearly capital expenditure — will not support renewable energy, many climate activists dismissed the initiative as "greenwash."
"This announcement is outrageous filibustering from an industry with no future," Danni Paffard, a campaigner at the environmental activist group 350.org, told the Guardian. "Forget their smoke and mirrors offerings, the fossil fuel industry’s basic business plan doesn’t stack up with global climate goals. Real climate action means leaving oil, coal and gas reserves in the ground, and until they do that nobody will be falling for this cynical PR spin."
The move comes at a time when several nations across the globe have, for the first time, agreed to a legally binding climate deal. However, according to a 2015 study, if the accord's target of keeping the rise in global temperatures to within 2 degrees Celsius above pre-industrial levels is to be met, a third of the world's known oil reserves, and 50 percent of all the natural gas reserves, cannot be burnt.
As things stand now, oil and gas cumulatively account for 37 percent of the world's anthropogenic greenhouse gas emissions, most of which is used in production of electricity, and as source of fuel for vehicles.
"Our results show that policy makers’ instincts to exploit rapidly and completely their territorial fossil fuels are, in aggregate, inconsistent with their commitments to this temperature limit," according to the study, published last year in the journal Nature. "Implementation of this policy commitment would also render unnecessary continued substantial expenditure on fossil fuel exploration, because any new discoveries could not lead to increased aggregate production."