Oil and Gas

Science-based emissions reductions for these companies are complex and the SBTi is taking a cautious and deliberate approach. As always, our aim is to develop robust methodologies that will support decarbonization at the pace and scale required by science. As a next step, the SBTi is planning a peer review of the oil and gas target setting methodology. To this end, the SBTi issued a request for proposals for a consultant that can facilitate a panel of independent external experts to complete a review of the oil and gas methods and guidance.

Due to the developing status of our guidance, the SBTi has updated its fossil fuel policy. In addition to its existing policy to pause the validation of targets from this sector, it is also pausing commitments from these companies. Commitments will not be accepted from companies or subsidiaries in categories 1.1 and 1.2 below. This policy is effective immediately and removal of previous commitments will be completed on Thursday 10 March 2022. The SBTi reserves the right to remove other companies that, after careful evaluation, are considered to fall within category 1 below. These companies may be reinstated following further development of the fossil fuel sector project. The SBTi will share further updates on the development of this guidance later in 2022.

1. Companies that cannot join the SBTi

• 1.1 Companies with any level of direct involvement in exploration, extraction, mining and/or production of oil, natural gas, coal or other fossil fuels, irrespective of percentage revenue generated by these activities, i.e. including, but not limited to, integrated oil and gas companies, integrated gas companies, exploration and production pure players, refining and marketing pure players, oil products distributors, gas distributors and retailers and traditional oil and gas service companies. (except as noted in category 2 below).

• 1.2 Subsidiaries (of any companies that fall under 1.1 above) cannot commit until the parent company is eligible to commit.

2. Companies that can join the SBTi

• 2.1 Companies that derive less than 50% of revenue from a) sale, transmission and distribution of fossil fuels, or b) providing equipment or services to fossil fuel companies (see 1.1).
• 2.2 Companies with less than 5% revenue from fossil fuel assets (e.g. coal mine, lignite mine, etc.) for extraction activities with commercial purposes.
• 2.3 Electric utilities that mine coal for their own power generation.

In summary, the SBTi is continuing work on the oil and gas methodology. Until this method is final, the following will be put in place:

• Companies that fit category 1 with commitments will be removed from the SBTi target dashboard
• The SBTi will no longer accept commitments and/or validate targets for companies that fit category 1

Further updates will be shared later in 2022. In the meantime, for any questions contact the team at [email protected]

You can also view our FAQs for further information.

Removed companies

The following companies have been removed from the SBTi according to our updated policy. This list will be updated regularly and does not necessarily represent all companies affected by the policy.

• CGP PRIMAGAZ
• FLUXYS BELGIUM
• OKQ8 AB
• James Fisher and Sons plc
• PJSC Tatneft
• Nabors Industries Ltd.
• Enagás S.A.
• Halliburton Company
• Schlumberger Limited

The purpose of this project is to develop science-based target-setting methodologies that allow stakeholders, including companies, investors, governments and civil society, to understand the alignment of Oil, Gas and Integrated Energy company emissions reduction targets with the level of transformation required to meet the goals of the Paris Agreement. The project, first and foremost, will address embedded emissions in fuel supplied, but will also seek to address scope 1 emissions (energy and methane process emissions). At a later stage the project should consider scope 2 emissions and links to refinery and petrochemical industry, consistent with the SBTi’s chemical sector development.

The SBTi is taking a transparent, phased approach to the development of this guidance.

In the initial phase, SBTi developed draft resources that outline science-based target setting methods and guidance for oil, gas and integrated energy companies. To ensure strategic cross-sector involvement in the development process, SBTi convened a technical working group composed of approximately 20 members. These included representatives of civil society organizations, oil, gas and integrated energy companies, investors, policymakers, academics, and other experts. Membership organizations are listed below.

The draft methods and guidance were published on SBTi’s website and comments were received during a public consultation that took place from August through October 2020. SBTi received 54 responses from organizations across the globe. A summary and initial assessment of the comments received is here.

During the current phase of the development process, SBTi is engaging a consultant to lead an independent expert panel review of the methods and guidance. This review will take into account the experts’ technical knowledge of the sector, as well as the comments received to date via the public consultation and an internal review conducted by the SBTi. On completion, SBTi will evaluate the next steps required to revise and finalize the methods and guidance. This may include an additional public consultation period. The expert review is expected to be complete by September 2022.

• Agence de la transition écologique (ADEME)
• Aviva Investors
• bp
• California Resources Corporation (CRC)
• Carbon Tracker
• Climate Accountability Institute,
• Eni
• Galp
• HSBCAviva Investors
• I Care
• Imperial College London
• Repsol
• Shell
• Total
• North Sea Transition Authority
• UN Global Compact
• University of Queensland Business School
• World Benchmarking Alliance
• World Resource Institute (WRI)
• World Wildlife Fund (WWF)

View the resources from our public consultation (now closed):

Consultation feedback summary

Draft guidance

• Guidance on Setting Science-Based Targets for Oil, Gas and Integrated Energy Companies
• Annex A: Non-Energy uses of Petroleum and Gas Products
• Annex B: Rationale for the Approach in Dealing with Overlap Between Oil&Gas and Petrochemical Industry
• Annex D: Fuel Specific Calculations for the Well-to-Wheel Indicator
• Annex F: The Least-Cost Methodology, Carbon Tracker
• Annex H: CH4 Emissions Analysis and Scenarios

Consultation resources

• Key Questions & Logistics for consultation
• Commenting Survey

Video explanations and guides to the public consultation

• Introduction to the project
• Overview of the methods: Well-to-Wheel Methodology
  
• Overview of the methods: Least-Cost Methodology

Overview of the methods: Sectoral Decarbonization Approach

• Key Consultation Q1: Scenarios
• Key Consultation Q2: Intensity vs. Absolute Targets
• Key Consultation Q3: Where in the value chain to set targets?
• Key Consultation Q4: Disaggregation of targets by scope
• Key Consultation Q5: Flexibility vs Comparability
• Key Consultation Q6: What counts for reaching a target and net-zero

Relevant papers – released as available

• Whitepaper: Analysis and Translation of Global Scenarios to Inform Paris-Aligned Pathways for the Energy System
  
• FAQ on Carbon Tracker’s Least-Cost Methodology
• Foundations for Science-Based Net-Zero Target Setting in the Corporate Sector

For enquiries about the oil and gas sector projecyt, email the team at [email protected]

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