The world’s biggest fossil fuel firms are quietly planning scores of “carbon bomb” oil and gas projects that would drive the climate past internationally agreed temperature limits with catastrophic global impacts, a Guardian investigation shows.
These companies are placing multibillion-dollar bets on humanity’s ability to stop global warming, according to exclusive data. Their massive investments in new fossil fuel production will only pay off if countries fail rapidly to reduce carbon emissions, which scientists believe is crucial.
The oil and natural gas industry is extremely volatile, but it is also extraordinarily profitable, especially when the prices are high. ExxonMobil Shell, BP, Chevron and BP have all made almost the same fortune. Profits of $2tn in the past three decades, while recent price rises led BP’s boss to describe the company as a “Cash machine”.
Despite the fact that oil companies are not able to resist the lure of huge payouts in the future, the lure of huge payouts seems to be attractive to them. world’s climate scientists stating in February that further delay in cutting fossil fuel use would mean missing our last chance “to secure a liveable and sustainable future for all”. As the UN secretary general, António Guterres, World leaders were warned in April: “Our addiction to fossil fuels is killing us.”
The details of the planned projects are not easily accessible, but a Guardian investigation reveals:
- The fossil fuel industry’s short-term expansion plans involve the start of oil and gas projects that will produce greenhouse gases equivalent to a decade of CO2 emissions from China, the world’s biggest polluter.
- These plans include 195 carbon-bombs, massive oil and gas projects that would each generate at least one billion tonnes of CO.2emissions during their lifetimes, which is approximately equivalent to 18 years of global CO2 currents2 emissions. 60% of these have already begun pumping.
- The top ten largest oil companies are expected to spend $103 million per day over the next decade to explore new fields of oil and natural gas that can’t be burned if global warming is to be kept well below 2C.
- The Middle East and RussiaIn relation to future oil production, Australia, Canada, and the US are often the most prominent. They are among the most developed countries and have the highest number carbon bombs. The US, Canada and Australia also give some of the world’s biggest subsidies for fossil fuels per capita.
The largest oil companies are on track for spending every day for the rest o the decade.
At the UN’s Cop26 climate summit in November, after a quarter-century of annual negotiations that as yet have failed to deliver a fall in global emissions, countries around the world finally included the word “coal” in their concluding decision.
Even this belated mention of the dirtiest fossil fuel was fraught, leaving a “deeply sorry” Cop president, Alok Sharma, fighting back tears on the podium after India announced a last-minute softening of the need to “phase out coal” to “phase down coal”.
Nonetheless, the world agreed coal power was history – the question now was how quickly cheaper renewables could replace it, and how fair the transition would be for the small number of developing countries that still relied on it.
Despite oil and gas being responsible for the Cop26 final agreement, there was no mention of them. Nearly 60%Emissions from fossil fuels
Additionally, many rich countries, like the USA, which dominate international climate diplomacy by positioning themselves as climate leaders at this conference, are big players when it comes to new oil and gas projects. But unlike IndiaThey avoided criticism.
The Guardian spent months after Cop26 trying to get a clear picture of the future of oil and gas exploration, production and production.
The world’s scientists agree the planet is in deep trouble. In August, Guterres reacted strongly to a stark report by the Intergovernmental Panel on Climate Change, the world’s leading authority on climate science. “[This report] is a code red for humanity,” he said.
The IPCC says carbon emissions must be reduced by half by 2030 to ensure a sustainable future. However, they are not declining.
Since then, experts have been warning At least 2011That most of the world’s fossil fuel reserves could not be burnedIt won’t cause global heat catastrophes.
2015 saw a high-profile study that found that the global temperature should not exceed 2C. Half of the known oil reserves and a third were to remain in the ground.Along with 80% of the coal.
“Simply put, they are lying and the results will be catastrophic,” said Guterres. “Investing in new fossil fuels infrastructure is moral and economic madness.”
The problem is more severe today. Internationally agreed upon guidelines have been established to better understand the devastating effects of climate crisis. Limit on global heating to 1.5CTo reduce the risk of extreme heatwaves and droughts, as well as floods.
The International Energy Agency released a May 2021 report, which was previously considered conservative. It concluded that there could possibly be. If the world were to reach net zero by 2050, there would be no new coalmines or oil fields..
Soon, more warnings were issued. A new scientific analysis revealed that the percentage of The fossil fuel reserves would need to be in the ground for 1.5C.The UN warned that oil and gas could be up to 60% and coal at 90% respectively. planned fossil fuel production “vastly exceeds”1.5C is the minimum temperature limit
In April, shocked by the latest IPCC report that said it was “Now or never” to start slashing emissions, Guterres launched an Outspoken attacksInformation on governments and companies who Climate actionsDid not Match their words.
“Simply put, they are lying, and the results will be catastrophic,” he said. “Investing in new fossil fuels infrastructure is moral and economic madness.
“Climate activists are sometimes depicted as dangerous radicals. But the truly dangerous radicals are the countries that are increasing the production of fossil fuels.”
The reaction to Russia’s war in UkraineThis has further pushed oil and natural gas prices higher. incentivising betsOn New fields InfrastructureThat would last for decades.
The failure of countries to “Get greener.” after the Covid-19 pandemic or the 2008 financial crash was not a good omen, and Guterres said: “Fossil fuel interests are now cynically using the war in Ukraine to lock in a high-carbon future.”
It is difficult to predict the future of oil and gas development because this sector is complex and often secretive. Public information is scarceThese are difficult to find and evaluate. But a global team of Guardian environment reporters has worked with leading thinktanks, analysts and academics across the world over the past five months and now we can answer a series of questions that reveal the scale of the sector’s plans.
First, how much production will come from the projects likely to begin drilling before the end this crucial decade?
Next, which are the most important projects in the world, the so called carbon bombs that would destroy the climate?
We also watched the money: how much will be spent on oil that can’t be burned safely and what will be invested in clean energy? Who benefits the most from fossil fuel subsidies that conceal the true damage they cause?
The answers to these key questions lead to an inescapable conclusion: if the projects go ahead, they will blow the world’s rapidly shrinking cap on emissions that must be kept to enable a liveable future – known as the carbon budget.
All The promisesMany oil companies have made this mistake, but the data shows that they still believe in their core business, despite the consequences.
Plans to expand
The short-term expansion plans that oil and gas companies have, such as ExxonMobilGazprom and BP are both colossal. The Guardian’s investigation has found that in the next seven or so years, they are likely to start producing oil and gas from projects that would ultimately deliver 192bn barrels, the equivalent of a decade of today’s emissions from China.
Urgewald analysts provided this estimate using data from Rystad energy, which is the industry standard but not publicly accessible.
Their Gogel database contains 887 companies that search for and produce oil or gas and covers 97% short-term expansion plans.
The companies have committed their final financial support to projects that will deliver 116bn barrels, more than half of the total 192bn barrel production.
They also invested heavily in the remainder, including final engineering and operation plans. Urgewald states that such investment makes these projects more likely to be realized, barring any drastic government action.
Companies have already made their final financial commitments to projects that will produce 116bn barrels oil.
A third of the short-term expansion plans of oil and gas would come from “unconventional” and riskier sources. These include fracking or ultra-deep offshore drill, which are intrinsically risky. more dangerous – as the oil and gas companies drill deeper, the number of spills, injuries and blowouts increase.
The 192bn barrels are divided roughly 50/50 between liquids, which include crude oil and natural gas. This would produce 73bn tonnes CO from burning it.2. Methane, which is a powerful greenhouse gases, traps 86x more heat than CO and can be found in gas operations.2Over 20 years. This is equivalent to 97bn tonnes CO if we assume a supply-chain leak rate 2.3%.2Added to the atmosphere, driving us faster towards climate catastrophe.
State oil companies lead the Urgewald short-term expansion list, with Qatar Energy, Russia’s GazpromThe top three are Saudi Aramco, Gazprom, and Saudi Aramco. Half of Gazprom’s projected expansion is in the fragile Arctic, though the long-term implications of Russia’s war in Ukraine on its fossil fuel plans remain to be seen.
The listed oil majors ExxonMobil and Total are Chevron, Chevron, and Total. ShellBP, BP and Unconventional Oil and Gas Production are all included in the top 10. Unconventional and risky oil and gas production accounts for about 70% of the US majors’ totals, while the proportion of fracking and ultra-deep water ranges from 30% to 60% for the European companies.
“Most oil and gas companies are just proceeding with business as usual,” Nils Bartsch at Urgewald said. “Some just do not care. Some do not see their responsibility because governments around the world let them proceed, although of course these governments are often influenced by the industry.”
According to Rystad energy data, two thirds of the 116bn barrels oil and gas projects companies are committed financially to are in North America, Russia, and the Middle East.
Australia is expected to be a major contributor with 3.4bn barrels. This is significantly more than the whole of Europe where fields have been relatively depleted.
An independent analysis by Urgewald of the average annual investment in oil & gas exploration over the last three years has shown that Shell and PetroChina are the top four spots. ChinaSinopec, National Offshore Oil Corporation. Seven out of the top 10 explorers depend on fracking for more than half of expansion.
Since it was first proposed more than 15 years back, Daniel Ribeiro has been fighting for plans to build a huge offshore pipeline and liquefied gas plant in Cabo Delgado, Mozambique.
The scheme would result in a massive increase in carbon emissions in the poorest and most vulnerable countries. climate-vulnerable countries, is backed by more than £1bn from the UK government and has some of the biggest oil and gas corporations circling, scenting another huge payday.
Exclusive Guardian research has shown that the development of Cabo Delgado could lead to catastrophic climate change around the globe.
“It is already creating a massive amount of disruption for the local fishing and subsistence farmers who are being moved off their land,” said Ribeiro, from the local Justiça Ambiental campaign group. “But if it goes ahead and countries like Mozambique are set off on a fossil fuel track, it will be a global disaster. We can forget tackling the climate crisis … we will all suffer.”
Research shared exclusively with the Guardian has identified the Cabo Delgado development as one of 195 carbon bombs, which – unless stopped – will drive catastrophic climate breakdown around the world.
Since the beginning of the decade, carbon bombs have been used extensively in climate circles to describe large fossil fuel projects. New research defines a carbon bomb as a project capable of producing at least 1bn tons of CO.2Emissions over their entire lives.
Projects identified include the new drilling wells springing up in the Canadian wilderness as part of the vast Montney Play oil and gas development, and the huge North Field gas fields in Qatar – named in the study as the biggest new oil and gas carbon bomb in the world.
The study, led by Kjell Kühne from the University of Leeds in the UK and due to be published in the journal Energy Policy, found that just a few months after many of the world’s politicians positioned themselves as climate leaders during the Cop26 conference in GlasgowThey were allowing a massive global expansion in oil and gas production, which scientists warn could lead to civilisation’s collapse.
Asad Rehman, a leading climate justice activist in the UK who was at the forefront of a global network of indigenous activists and civil society campaigners in Glasgow, accused the US, Canada and Australia of “rank hypocrisy”.
“These countries are single-handedly undermining efforts to curtail global emissions and ignoring their responsibility to phase out fossil fuels rapidly and justly.” He said it was the poorest and most vulnerable who were suffering.
These projects together would result in 646 GtCO2 emissions, swallowing up the world’s entire carbon budget
“Only the colonial mindset of political leaders in rich countries can make the brutal calculation that the interest of fossil fuel giants and their billions in profit is more important than the lives of people who are overwhelmingly black, brown and poor.”
These projects together would yield 646bn tons of CO2 According to the study, emissions can be swallowed by the world’s entire carbon budget. More than 60% of these schemes have already been in operation.
Kühne, the director of the Keep it in the Ground InitiativeAccording to, in the first instance, 40% of projects had not started production yet. This was necessary if the world is not to slide further into disaster. They should also be a prominent focus for the global climate protest movement in months and years.
“The oil and gas industry is continuing to plan these huge projects, even in the face of a burning planet. The ambitious targets set by the Paris AgreementThey were apparently not sufficient to make them question their business case. These carbon bombs are the single biggest indicator that we are not trying hard enough.”
The Rystad Energy data was used in the study. However it does not focus solely on total barrels. Instead, it identifies mega projects which could be responsible.
The US is the largest source of potential emissions, according to the research. Its 22 carbon bombs, which include conventional drilling and fracking, span the deep waters of Mexico to the foothills of Colorado’s Front Range. Permian basin. They have the potential to combine to produce 140bn tonnes CO2This is almost four times the amount that the entire world emits each annual.
With 107bn tonnes, Saudi Arabia is second after the US. Next are Russia, Qatar, Iraq and Canada.
Australia is 16th in the world, a country widely condemned by international leaders for being a laggard when it comes to addressing climate crisis.
Robyn Churnside is a Ngarluma elder from the Burrup Peninsula in remote north-west Australia. She has been fighting against mining and fossil fuel development since the 1970s. She is part of a campaign trying to stop Woodside’s US$12bn Scarborough gas project, one of the biggest fossil fuel developments in the country in a decade.
Churnside claimed that Indigenous voices were too often ignored in decisions regarding new oil and gas infrastructure. This could lock in carbon for decades and desecrate culturally valuable sites.
“It’s about time the world listened to First Nations people because we have been here a long, long time,” she said. “Our spirit in this land will never rest. It needs protection.”
Professor Kevin Anderson, Tyndall Centre of Climate Research University of Manchester, and Uppsala University in Sweden said that the scale of planned oil production suggested that big oil and its political backers either didn’t believe climate science or believed their extreme wealth could somehow shield them and their children against the terrible consequences.
“Either the scientists have spent 30 years working on this issue and have got it all wrong – the big oil CEOs know better – or, behind a veil of concern, they have complete disregard for the more climate vulnerable communities, typically poor, people of colour and far away from their lives. Equally worrying, they are disinterested in their own children’s future.”
When BP published its quarterly earnings in a Presentation to financial institutions in February, one analyst said he “really enjoyed the camaraderie and the positivity that you’re generating”, before asking about the company’s cash position.
“We’ve given you a lovely little chart,” said Murray Auchincloss, BP’s chief financial officer. “Certainly, it’s possible that we’re getting more cash than we know what to do with. For now, I’m going to be conservative and manage the company as if it’s $40 [a barrel] oil. Anything we could get above that just helps, obviously.” At the time, the oil price exceeded $90; today it is $106.
The oil industry is awash of cash. The money companies have is owned by shareholders, including pension funds and national oil companies. It also belongs to governments and, theoretically, to citizens. The investment plans of the largest oil companies are clearly at odds with the goal to end the climate crisis.
Data obtained by the Guardian from the thinktank Carbon Tracker shows a dozen of the world’s biggest companies are on track to commit a collective $387m dollars a day of capital expenditure to exploiting oil and gas fields through to 2030.
A significant portion of this is for maintaining production at existing projects – some oil and gas will still be needed as the world weans itself off fossil fuels – but the exact amount is not publicly available. Nonetheless, it is clear that at least a quarter of this investment – $103m a day – is for oil and gas that cannot be burned if the worst impacts of the climate crisis are to be avoided, money that could instead be spent ramping up clean energy.
Even more concerning is the fact that the companies have devised additional project options that might see them spending an additional $84m per hour that is not compatible even with a catastrophic 2.7C global heating.
The world’s governments agreed in the Paris climate agreementLimit global warming to below 2C, and work to limit the temperature rise up to 1.5C. No new oil and gas projects will be possible for this latter, more stringent goal.
The Carbon Tracker data, compiled in September, uses a temperature of 1.65C to represent the well below 2C target and finds that 27% of the companies’ projected investments are incompatible with this.
ExxonMobil is the most climate-friendly of these investment plans, with $21m per day through 2030. Petrobras ($15m), Chevron (both $12m), ConocoPhillips ($12m) and Shell ($8m) are close behind.
In terms of the most dangerous investments – those that could help drive temperatures beyond 2.7C – Gazprom accounts for $17m a day of this, ExxonMobil $12m, Shell $11m and PetroChina $9m.
If governments follow the scientific advice to reduce carbon emissions quickly by increasing clean energy and cutting fossil fuel combustion, then the companies would have the financial burden of writing off these huge amounts as losses. This would impact shareholders, pension funds, and the public finances. The companies could make a profit as the world burns if the governments don’t act.
Overall, international oil companies are making the biggest bets. Almost 40% of their projected investments are not compatible with 1.65C. ExxonMobil’s 56% is particularly high. The national oil company average is 17%, although 56% of Petrobras’s planned capital expenditure is incompatible with 1.65C.
“Companies that continue to develop projects based on business-as-usual demand are betting on the failure of policy action on climate and underestimating the disruptive potential of new technologies, such as renewables and battery storage,” said Mike Coffin at Carbon Tracker. “Such projects are either not needed or they lead to warming well in excess of Paris goals.”
SeparateRecent analysis based on Rystad Energy data from April, after Russia’s invasion of Ukraine, found that 20 of the world’s biggest oil and gas companies remained on course to spend huge sums – $932bn – by the end of 2030 developing new oil and gas fields.
Freeing the world from the grip of fossil fuels is made far harder by huge ongoing subsidies for the fuels, making them far cheaper than their true cost when the damage they cause is included – especially air pollution, which 7 million people are killed every year. The G20 group representing the world’s leading economies promised in 2009 to eliminate subsidies, but little has been accomplished.
There are hundreds of Direct financial support in the billions is received by the producers and consumers of fossil fuels every year – but they benefit from far larger subsidies by not paying for the harm burning fossil fuels causes. Once the climate crisis and pollution are accounted for, the fossil fuel subsidies reachAccording to the International Monetary Fund, $6tn is a year. Guardian analysis shows that this amount is equivalent to $11m per hour globally, $4m per hour in China, and $1m in the USA.
Guardian analysis of more detailed IMF data shows drivers in the US, Canada and Australia, along with Saudi Arabia, are the world’s biggest beneficiaries of subsidies for road fuels, with some governments under pressure to increase these during the current energy crisis.
Saudi Arabia’s per capita subsidy for petrol/diesel was more than $1,000 annually in 2020. The US road fuel subsidy per person is $644, while it is about $500 in Canada and Australia.
Japan and Germany also make it into the top 10 in the road fuel analysis. The analysis focused on 54 large countries with more that 25 million people, and that account to 90% of global subsidies and population. The UK’s per capita subsidy for roadfuels was only $10 per year, which suggests that taxes on petrol and diesel in 2020 were similar to the damage they cause.
The US ranks second on the list of countries that provide the largest per capita subsidies for fossil fuels, with $2,000 per year. This is behind only Saudi Arabia ($4,550), and Russia ($3,560). Only Iran ($1815) is ahead Australia ($1730), Canada ($1690) and Canada.
“Taking the Paris agreement seriously requires a rapid shift away from fossil fuels,” said Simon Black, a climate economist at the IMF. “Getting fossil fuel prices right will help enormously in accelerating this transition.”
It will take time to shift from burning oil and natural gas. However, a decreasing amount of oil and gas will still be required during the transition to a global economy with zero emissions in 2050. The question is whether governments and companies are moving fast enough.
The Guardian wrote to all the oil and natural gas companies included in its analysis, and asked them for their responses.
“Under the IEA net zero emissions scenario, and all Paris-aligned scenarios, all energy sources remain important through 2050, and oil and natural gas remain essential components of the energy mix,” said a spokesperson for ExxonMobil.
However, oil and gas will play a much smaller role in 2050. IEA: “Beyond projects already committed as of 2021, there are no new oil and gas fields approved for development [in our net zero scenario].”
ExxonMobil plans to invest more than $15bn in initiatives to reduce greenhouse gas emissions over six years, a spokesperson stated. This included carbon capture and storage, hydrogen, and biofuels. The company set a goal to achieve net zero emissions by 2050. However, it did not target the fuels it sold and only its own operations. Therefore, it covers only a small percentage of the emissions from oil or gas it sells.
Recent statements by a spokesperson for Shell were made Statements from companies: “As a result of [our] planned level of capital investment, we expect a gradual decline of about 1-2% a year in total oil production through to 2030, including divestments.”
“The world is in a race against time,” said Guterres. “It’s time to end fossil fuel subsidies and stop the expansion of oil and gas exploration.”
“By 2025, Shell expects its expenditure on [low and zero-carbon] products and services across its businesses will have increased to around 50% of its total expenditure,” a recent ReportThe firm states. This percentage is expected to increase to more than 35% in 2022. In 2021, “Shell achieved its annual investment targets in renewables and energy solutions of $2bn-3bn”, the report says.
ConocoPhillips also cited recently published net zero emissions plan: “Our goal is to support an orderly transition that matches supply to demand and focuses on returns on, and of, capital while safely and responsibly delivering affordable energy.”
According to the document, profits from oil and natural gas projects are significantly greater than those from investments in renewable energy.
ConocoPhillips allocated $200m to reduce emissions from its operations in 2022. To reduce emissions from the burning of the fossil fuels it supplies, the company advocates an “economy-wide price on carbon that would help shift consumer demand from high-carbon to low-carbon energy sources”.
“Petrobras plans its investments considering that the Paris agreement will be successful and global temperature will be kept below 2°C,” a spokesperson for the company said. “Oil will remain important in the coming decades, even in accelerated transition scenarios.”
The spokesperson said the IEA’s scenario for 1.65C indicated some investment in upstream projects was needed. “We are planning for Highly resilient assetsTheir low production cost and low emission makes them competitive in Paris-like situations. Petrobras will continue to maximize its portfolio’s value as part of its strategy. [with 99% of the investment on exploration] focusing on deepwater and ultra-deepwater assets.”
TotalEnergies pointed at its Recent sustainability report, which it said “showed our stakeholders that we are already on the right track”. The company has set a goal to reduce its oil and gas emissions by 30% by 2030, and to increase the percentage of renewable energy sales from 9% in 2021 up to 20% by 2030.
Eni and Saudi Aramco responded to the Guardian, but declined to comment. The other companies did not respond to the Guardian’s request.
Race against time
The Guardian’s investigation has provided an answer to the question of how great a danger the plans of oil and gas companies pose to the climate.
There are other questions that politicians and governments must answer, which will ultimately impact the course of the climate emergency.
Will the world’s governments act to close the book on the oil companies’ giant climate gamble? Will the richer countries that have historically emitted the most be supportive of a fair transition for the developing countries at the frontline in the escalating crisis’s escalating crises?
Would strong, immediate action lead to a financial crash, as billions of dollars are wiped off the value of some of the world’s biggest companies? Or will more steady but concerted action wean us off fossil fuels rapidly, close the oil companies’ cash machine and lead us into a clean energy future with a liveable climate? Only time will tell. However, time is not in short supply, unlike oil and natural gas.
“The world is in a race against time,” said Guterres. “It is time to end fossil fuel subsidies and stop the expansion of oil and gas exploration.”
Reflecting on the conflict in Ukraine He said: “Countries could become so consumed by the immediate fossil fuel supply gap that they neglect or knee-cap policies to cut fossil fuel use. This is madness. Addiction to fossil fuels is mutually assured destruction.”
Additional reporting by Adam Morton, Jillian Ambrose Nina Lakhani Oliver Milman, Chris McGreal