There are over 1,100 oil-producing wells in the McKittrick oil field, just north of the town of McKittrick, California. (Photo: Carolyn Cole/Los Angeles Times via Getty Images)
“The science is clear: No new oil and gas fields, or the planet gets pushed past what it can handle,” said one analyst.
Fossil fuel-producing countries late last year pledged to “transition away from fossil fuels,” but a report on new energy projects shows that with the United States leading the way in continuing to extract oil and gas, governments’ true views on renewable energy is closer to a statement by a Saudi oil executive Amin Nasser earlier this month.
“We should abandon the fantasy of phasing out oil and gas,” the CEO of Saudi Aramco, the world’s largest oil company, said at an energy conference in Houston.
A new report published Wednesday by Global Energy Monitor (GEM) suggests the U.S. in particular has abandoned any plans to adhere to warnings from climate scientists and the International Energy Agency (IEA), which said in 2021 that new oil and gas infrastructure has no place on a pathway to limiting planetary heating to 1.5°C.
Despite the stark warning, last year at least 20 oil and gas fields worldwide reached “final investment decision,” the point at which companies decide to move ahead with construction and development. Those approvals paved the way for the extraction of 8 billion barrels of oil equivalent (boe).
By the end of the decade, companies aim to sanction nearly four times that amount, producing 31.2 billion boe from 64 oil and gas fields.
The U.S. led the way in approving new oil and gas projects over the past two years, GEM’s analysis found.
The oil & gas industry persists in development of new fields, as top producing countries boost production.
Our latest report uncovers the regions driving the push for new fossil fuel reserves.
— Global Energy Monitor (@GlobalEnergyMon) March 28, 2024
An analysis by Carbon Brief of GEM’s findings shows that burning all the oil and gas from newly discovered fields and approved projects would emit at least 14.1 billion tonnes of carbon dioxide.
“This is equivalent to more than one-third of the CO2 emissions from global energy use in 2022, or all the emissions from burning oil that year,” said Carbon Brief.
GEM noted in its analysis that oil companies and the policymakers who continue to support their planet-heating activities have come up with numerous “extraction justifications” even as the IEA has been clear that new fossil fuel projects are incompatible with avoiding catastrophic planetary heating.
The report notes that U.S. Sen. Lisa Murkowski (R-Alaska) “supported ConocoPhillips’ Willow oil field, arguing that the Alaskan oil and gas industry has a ‘better environmental track record,’ and not approving the project ‘impoverish[es] Alaska Natives and blame[s] them for changes in the climate that they did not cause.'”
Carbon Brief reported that oil executives have claimed they are powerless to stop extracting fossil fuels since demand for oil and gas exists for people’s energy needs, with ExxonMobil CEO Darren Woods telling Fortune last month that members of the public “aren’t willing to spend the money” on renewable energy sources.
A poll by Pew Research Center last year found 67% of Americans supported the development of alternative energy sources. Another recent survey by Eligo Energy showed that 65% of U.S. consumers were willing to pay more for renewable energy.
“Oil and gas producers have given all kinds of reasons for continuing to discover and develop new fields, but none of these hold water,” said Scott Zimmerman, project manager for the Global Oil and Gas Extraction Tracker at GEM. “The science is clear: No new oil and gas fields, or the planet gets pushed past what it can handle.”
Climate scientist and writer Bill McGuire summarized the viewpoint of oil and gas executives and pro-fossil fuel lawmakers: “Climate emergency? What climate emergency?”
The continued development of new oil and gas fields, he added, amounts to “pure insanity.”
A sign reading “Stop, extreme heat danger” is seen in Death Valley National Park in California. (Photo: Patrick T. Fallon/AFP via Getty Images)
“The clean energy transition has undergone a series of stress tests in the last five years—and it has demonstrated its resilience,” said IEA Executive Director Fatih Birol.
Carbon emissions reached a record high in 2023, but the increased adoption of renewable energy is helping slow the pace, according to the International Energy Agency.
The IEA said in a new report that global CO2 emissions “increased by 410 million tonnes, or 1.1%, in 2023—compared with a rise of 490 million tonnes the year before—taking them to a record level of 37.4 billion tonnes.”
But the agency found that carbon emissions “rose less strongly in 2023 than the year before even as total energy demand growth accelerated… with continued expansion of solar PV, wind, nuclear power, and electric cars helping the world avoid greater use of fossil fuels.”
The report notes that “exceptional droughts” decreased the amount of hydropower that could be produced last year. Demand for coal fell to “levels not seen since the early 1900s.” It says CO2 emissions would have been three times larger had renewable energy not been utilized to generate electricity.
An IEA report from September found that rapid adoption of clean energy technologies could keep the world from surpassing the 1.5°C warming target. The Energy Information Administration forecast in December that 2024 could become the first year that wind and solar power generate more electricity than coal in the U.S.
The world will need to adopt a lot more renewable energy to address the climate crisis. Last month was most likely the warmest February on record, and records like that are being set every year. The more countries burn fossil fuels, the higher the temperatures will go.
“The clean energy transition has undergone a series of stress tests in the last five years—and it has demonstrated its resilience,” said IEA executive director Fatih Birol. “A pandemic, an energy crisis and geopolitical instability all had the potential to derail efforts to build cleaner and more secure energy systems. Instead, we’ve seen the opposite in many economies.”
Romain Ioualalen, Global Policy Manager at Oil Change International said:
“It is positive to see this COP28 presidency and the IEA reflect the growing consensus that we need urgent action to rein in fossil fuel production and use. As COP28 negotiations start, countries must agree to end fossil fuel expansion, the only way to see fossil fuels decline significantly this decade, and for a full phase out of fossil fuels production and use. Distant promises and voluntary pledges are not enough, we need to see immediate action.
“The phase out will not happen on its own, even with growth in renewable energy. Without a strong agreement at COP28 that gets reflected in national policies, fossil fuels will not decline at the speed and scale necessary to limit temperature rise to 1.5°C.
“We deeply regret the inclusion of the fossil fuel industry’s favorite distractions, CCS and hydrogen, in this document and we urge parties to oppose any attempts to legitimize these failed technologies in a COP decision”.
David Tong, Global Industry Manager at Oil Change International said:
“Fatih Birol and the IEA reconfirmed this year that to limit global warming to 1.5ºC, there is no room for any new oil and gas expansion beyond existing fields and mines. To confront the climate crisis we need a full, fast, fair, and funded phase out of oil, gas, and coal.
“Oil Change International data show no big oil and gas company comes even close to aligning its business model with the Paris Agreement. Fossil fuel producers will not phase themselves out. The Big Oil and Gas business model cannot be reformed. Its foundation is destruction – of communities, of ecosystems, and all our futures. Cutting oil and gas companies’ operational emissions will achieve a maximum of 20% reduction in their total emissions. Governments must act to phase out the destructive fossil fuel industry and unlock the transition to nature-positive, community-owned, renewable energy.”
Greenpeace activists display a billboard during a protest outside Shell headquarters on July 27, 2023 in London. (Photo: Handout/Chris J. Ratcliffe for Greenpeace via Getty Images)
Wind turbines are shown in front of a coal-fired power plant operated by energy giant RWE near Niederaussem, Germany on October 5, 2022. (Photo: Ina Fassbender/AFP via Getty Images)
The International Energy Agency warned that while renewable energy use is surging, fossil fuel production worldwide remains “far too high” to prevent catastrophic warming.
The International Energy Agency warned Tuesday that governments aren’t moving with nearly enough urgency to phase out fossil fuels, leaving the world on a perilous track toward 2.4°C of warming above preindustrial levels by the end of the century.
While the IEA’s latest World Energy Outlook (WEO) report celebrates “the phenomenal rise of clean energy technologies such as solar, wind, electric cars, and heat pumps,” it makes clear that the continued burning of oil, gas, and coal is undermining global renewable energy progress.
“As things stand, demand for fossil fuels is set to remain far too high to keep within reach the Paris Agreement goal of limiting the rise in average global temperatures to 1.5°C,” the IEA said. “The costs of inaction could be enormous: despite the impressive clean energy growth based on today’s policy settings, global emissions would remain high enough to push up global average temperatures by around 2.4°C this century, well above the key threshold set out in the Paris Agreement.”
The IEA released its annual report just over a month before the COP28 summit in the United Arab Emirates, one of the world’s top oil producers.
Kelly Trout, research director at Oil Change International, said in a statement Tuesday that the IEA’s analysis provides a “roadmap for the upcoming United Nations Climate Change COP28 negotiations: limiting warming to 1.5°C requires a clear decision on a fast, fair, and fully funded end of fossil fuels as well as a rapid deployment of renewable energy and energy efficiency, with wealthy countries in the lead and paying their fair share for a just energy transition.”
“We can’t solve the climate crisis by adding renewable energy on top of new fossil fuels—we need to rapidly replace and phase out all fossil fuels, including gas,” said Trout. “There is a massive and deadly gap between current policies, which still lead to higher oil and gas use in 2030 than today, and the rapid declines in fossil fuels required to stave off runaway climate disaster. Every investment in new oil and gas infrastructure is an investment in more methane leaks, more warming, and more of the extreme heat, floods, fires, and drought destroying communities and ecosystems.”
“We need a fast and fair plan to phase out polluting fossil fuels that are killing us.”
The energy agency said the rapid emergence and deployment of renewable energy—including wind and solar power and electric vehicles—are keeping alive hopes of preventing catastrophic warming.
“The transition to clean energy is happening worldwide and it’s unstoppable,” Fatih Birol, the IEA’s executive director, said Tuesday. “It’s not a question of ‘if,’ it’s just a matter of ‘how soon’—and the sooner the better for all of us.”
But the agency cautioned that even major increases in clean energy use won’t be enough to limit planetary warming if fossil fuel use doesn’t sharply decline. A recent NASA-led study found that keeping warming below 2°C by century’s end is “critical to limiting dangerous and cascading impacts” of climate change.
The IEA’s report notes that the world is currently set for “an unprecedented surge” in new liquefied natural gas (LNG) projects, which are heavily polluting. The agency observed that “more than half of the new projects are in the United States and Qatar.”
Kaisa Kosonen, policy coordinator at Greenpeace International, said in response to the new report that “every new fossil fuel project is in stark violation of the Paris Agreement’s 1.5°C warming limit—leaders simply cannot claim to be in support of global action on climate change while supporting fossil fuel expansion.”
“We need a fast and fair plan to phase out polluting fossil fuels that are killing us,” said Kosonen. “Those who’ve polluted and profited the most must be made accountable and financially support the most vulnerable people, communities, and countries in their transition to clean, renewable energy.”
The influential Conservative-linked Centre for Policy Studies (CPS) has been pushing for further North Sea oil and gas drilling while several of its board members hold financial interests in the industry, a DeSmog investigation has found.
The news follows the government’s approval of the major Rosebank oilfield and the issuing of new North Sea licences, which the government intends to turn into a mandatory annual process, as announced in this week’s King’s Speech.
Five of the think tank’s board have financial interests in North Sea oil and gas, including its chair Lord Spencer, a major Conservative Party donor whose exploration company is bidding for licences in the current round.
The think tank, which is based at 57 Tufton Street in Westminster, meets regularly with ministers. It has called for new oil and gas projects to be accelerated, labelled the windfall tax on energy companies a “terrible idea”, and argued for a more generous fiscal environment for the UK’s fossil fuel producers.
Prime Minister Rishi Sunak is quoted on the organisation’s website as saying that “Lots of exciting ideas are being generated at the CPS… many of which are finding their way into government.”
Tessa Khan, executive director of climate group Uplift, said the findings were an example of how some think tanks have “long been little more than lobbying vehicles for private interests, including oil and gas”. The CPS denies that it is a lobbying group.
Khan added that organisations like the CPS “amplify the voices” of the oil and gas industry.
“This maybe goes some way to explaining why this government is set on subsidising new oil and gas fields when they represent such a bad deal for the public, in that they won’t lower bills, won’t increase energy security but will make the climate crisis worse,” she said.
Nature broadcaster Chris Packham, who is threatening to take the government to court over its recent watering down of climate measures, said: “Just weeks after we learn that not a single new offshore wind project will be going ahead this year due to the government’s intransigence – and as Rishi Sunak tears up vital climate policies – these findings are shocking.
“They provide further evidence that Number 10’s fossil fuel agenda is far from accidental. There are powerful vested interests at work and the Centre for Policy Studies seems to be at the heart of it. The government’s plan to hand out more than a hundred new North Sea drilling licences in the coming months is looking grubbier than ever.”
DeSmog previously revealed that the Conservative Party received £3.5 million from fossil fuel interests in 2022, including from the North Sea industry. This week, DeSmog also revealed that the government watered down its windfall tax on the excess profits of energy firms after a lobbying blitz by the oil and gas industry.
When asked about its board members’ business interests, a CPS spokesperson said that the think tank is “grateful for all our supporters, especially the support of our board members, but the investments of other boards on which they sit have no bearing on their relationship with the CPS”.
They claimed that DeSmog was “cherry-picking in order to manufacture an incorrect picture of the CPS’s position” and that it was “misleading and below journalistic standards.”
They added that “the Centre for Policy Studies has been one of the most prominent champions of free-market environmentalism, with a dedicated workstream on net zero” and that “Where our work is sponsored, this is made clear in the report acknowledgments, in press releases, and in event invitations.”
The North Sea Transition Authority (NSTA), the regulator in charge of issuing drilling licences, said that oil and gas were “forecast to play an important role in the energy mix for decades to come”. A spokesperson said the NSTA was “pleased” with the number of applications received in the current oil and gas licensing round and that the process of assessing them was “progressing well”.
The Department for Energy Security and Net Zero declined to add any further comment.
At the end of September, the International Energy Agency, of which the UK is a member, released a report reiterating the need for a phaseout of fossil fuels if climate goals are to be met.
Lord Deben, the recently retired chair of the UK’s Climate Change Committee, which advises the government, argued in August that the government should stop approving North Sea licences.
Deltic Energy
Lord Spencer, who has chaired the CPS since the start of 2020, is the largest shareholder of Deltic Energy, which holds stakes in 18 North Sea areas, known as blocks, according to NSTA data.
A former Conservative Party treasurer, Spencer was given a life peerage by Boris Johnson. Official data shows that he has donated more than £7.5 million to the Conservative Party, individual Tory politicians and officially affiliated groups since 2015. He also sits on the board of the party’s multi-million-pound endowment fund. DeSmog revealed earlier this year that many of its directors have significant fossil fuel interests.
Through his holding company, IPGL, Spencer owns a £17.5 million stake in Deltic, according to Refinitiv data – nearly a fifth of the firm. He has held a significant shareholding since at least 2018, and bought more shares in 2019 from its founder Algy Cluff, a pioneer of the original North Sea oil boom in the 1970s who himself later joined the CPS board.
Responding to an enquiry from DeSmog, Cluff said that although the value of the company “may have increased in the view of management”, the stock market is “unimpressed and very much aware of the risks associated with any oil investments nowadays”. He described the “small number” of options he holds in the company as “presently worthless”.
Cluff has nevertheless spoken of the North Sea’s “second coming”, claiming that there is “a lot more oil to be found” and a “huge amount of gas”.
Deltic has made significant discoveries in recent years, touting its “enviable reputation as proven hydrocarbon finders” on its website, and has seen its market value rise in tandem.
It won blocks in North Sea licensing rounds in both 2018 and 2020, with the former is said to represent an area the “size of Bedfordshire”.
In its latest annual report, for the 2022 calendar year, Deltic criticises the government’s windfall tax but praises its accompanying investment allowance, which provides North Sea companies with tax breaks to encourage investment.
A presentation it gave investors in March describes its strategy as “Identify. Explore. Monetise. Repeat.” It says the investment allowance “significantly enhances economics from investment in Deltic exploration”, touts controversial gas-derived “blue hydrogen” as environmentally friendly, and highlights “established export infrastructure” and “regular licensing rounds” as attractive features of the North Sea.
Deltic is chaired by Mark Lappin, a former technical director of fracking company Cuadrilla who has publicly called for more oil and gas production, criticising opposition to new drilling.
Lord Spencer’s Conservative donations, made either personally or through IPGL and ICAP, include £25,000 gifts to the 2022 leadership campaigns of Sunak, Liz Truss, and Penny Mordaunt.
Spencer made £20,000 donations to Johnson, Jeremy Hunt, Michael Gove and Sajid Javid in 2019, and has made smaller donations to numerous other leading figures within the party in recent years, including Kwasi Kwarteng, Dominic Raab, Theresa May, Brandon Lewis, and Andrew Griffith.
Spencer has also funded “Blue Collar Conservatism”, a large caucus of Conservative MPs working to “champion working people”, with donations totalling £25,000 in 2019 and 2020. The group has campaigned against fuel duty rises.
Spencer’s Other Fossil Fuel Interests
Lord Spencer has also publicly talked up the fossil fuel industry, telling LBC’s Nick Ferrari last September that the UK “sadly has opposed further investment in North Sea oil and gas”. During the interview, he praised then Prime Minister Liz Truss for speaking out against windfall taxes on the sector, calling them “not Tory policy” and “not pro-business”.
He also expressed support for fracking, praised Truss’s “strategy” and “ideology”, and called for investment in renewable energy, but omitted to mention his interests in oil and gas.
In addition to the North Sea, Spencer has various other fossil fuel interests. According to Refinitiv, he holds the second largest stake in Pantheon Resources, a UK company exploring for oil in Alaska that recently hailed a potentially enormous discovery.
His brokerage firm ICAP also includes an oil and gas trading arm. Until December last year, Spencer held shares in Petrofac, an oilfield services firm heavily involved in the North Sea, including the controversial Cambo project.
Spencer’s shareholdings are disclosed to the House of Lords – indicating either a stake worth more than £70,000 or significant control over the company. They include Cluff Energy Africa, described as an “early stage oil prospecting company, seeking licences in Africa (Angola and Sierra Leone)”.
Its founder, Algy Cluff, told DeSmog that they had “wound the company up” because they “found the premium being asked by governments for the right to explore not to be consonant with the rewards”.
Cluff was a director of the CPS between 1995 and 2006, coinciding with the executive directorship of the late Tessa Keswick. Cluff confirmed to DeSmog that Keswick helped him find investors for his North Sea consortium in the 1970s, as has been reported.
Tessa’s husband Henry Keswick, chairman emeritus of the conglomerate Jardine Matheson and a major Tory donor, used to own the influential conservative Spectator magazine and sold it to Cluff in the early 1980s. Cluff was its chairman until 2004, during which Charles Moore, Dominic Lawson, and Boris Johnson were editors.
The magazine was edited in the 1960s by the late Nigel Lawson, who would become Thatcher’s chancellor and in later life promote climate science denial through the Global Warming Policy Foundation, based at 55 Tufton Street.
Cluff’s remaining business interests include Cluff Mineral Resources, an Africa-focused gold and coal exploration company, which was temporarily based at 55 Tufton Street before moving next door to share an address with the CPS.
The Board
Another CPS board member, Lord Strathclyde, is a senior strategic adviser to Hibiscus Petroleum, a Malaysian oil and gas company that has amassed stakes in 11 North Sea blocks in recent years.
Ithaca, the firm behind the high-profile Rosebank and Cambo projects, is partnering with Hibiscus on one of the blocks.
Hibiscus is also one of the firms to have been awarded stakes in the latest round of oil and gas licences.
Strathclyde, who was leader of the House of Lords under David Cameron, is an adviser to oil trading giant Trafigura.
Sir Douglas Flint, chair of Abrdn – formerly, Standard Life Aberdeen – also sits on the CPS board. Abrdn has been targeted by protesters for its investments in oil and gas, which climate researchers Urgewald estimate at £2.9 billion. According to the latest figures, they include oil majors like BP, Shell and Exxon, as well as North Sea-focused firms Serica Energy, Harbour Energy, and EnQuest.
The major asset manager was reportedly one of a group of financial institutions recently summoned by the Treasury to increase investment in the North Sea.
Lord Spencer’s entry in the register of interests indicates he also holds a stake worth more than £70,000 in Abrdn.
Other CPS board members include Jon Moulton, chair of FinnCap, a financial advisory firm whose activities include raising finance for North Sea oil and gas companies, and Roger Orf, a partner at Apollo Global Management, a US private equity firm with £349 million of investments in BP and Shell, both major North Sea players.
Two further CPS board members have wider interests in oil and gas: Ian Molson, deputy chair of Central European Petroleum, which is exploring for oil in Germany and Poland; and major Tory donor Lord Bamford, chair of construction giant JCB, a sector still heavily reliant on fossil fuels.
In April 2023, DeSmog revealed that CPS board members had donated more than £600,000 to the Conservatives since Rishi Sunak became prime minister.
The CPS also leans on its board for funding. According to the group’s latest accounts – for the period up to September 2022 – its directors donated £1 million to the company during the year. Turnover was £650,000 during the year and ‘other operating income’ hit £1.5 million, meaning that the CPS board contributed nearly half (47%) of its income during the period.
North Sea Push
The Centre for Policy Studies has strongly supported new North Sea oil and gas drilling in recent years.
In a March 2022 economic bulletin, it recommended that the government “look at accelerating regulatory approval for upcoming oil and gas projects such as Rosebank [Phase 1], Clair South, Glengorm, Cambo and Bentley [Phase 2]”.
The bulletin added that introducing a windfall tax on profits would be a “terrible idea” and “completely self-defeating”. It welcomed “reports” suggesting the government was planning to launch another licensing round for fossil fuel projects.
A month later, the CPS welcomed the government’s “energy security strategy”, calling the return of annual North Sea licensing rounds “overdue”. A 33rd licensing round was launched in October.
In February this year, one of the CPS’s senior researchers criticised the “punishment beatings inflicted on the North Sea oil and gas industry from George Osborne onwards” – despite the sector having enjoyed one of the most generous tax regimes in the world until the recent windfall tax.
Other articles published on CapX, a commentary website run by the CPS, have labelled the Labour Party’s policy of no new North Sea licences “more than a little nuts” and the SNP’s similar position a “dangerous gambit”.
Andy Mayer, chief operations officer at the BP-funded Institute of Economic Affairs, writes regularly for CapX. He has used the platform to describe opposition to the Rosebank project as “shrill hysteria”, Shell’s bumper profits this year as “brilliant stuff”, and North Sea companies being fined for gas flaring as a “dotty investment message to send”. Following the announcement of the latest North Sea licences, Mayer wrote a story for CapX headlined “Hurrah for new North Sea oil licences!”
CPS Influence
The CPS has significant political access, having conducted private, one-to-one meetings with ministers on 27 occasions since 2014 and attended many other larger ministerial meetings, according to data compiled by Transparency International from government disclosures.
A number of the think tank’s former employees are now working as government advisers and its homepage carries supportive quotes from former prime ministers Liz Truss and Boris Johnson.
Rishi Sunak spoke at a CPS event at the Conservative Party conference in 2019 and wrote a report for the organisation in 2016 backing the roll-out of freeports, which have since been introduced.
The think tank, which was co-founded by Margaret Thatcher, hosted a “dedicated space” at this year’s party conference, with speakers including Jeremy Hunt, Michael Gove, and Grant Shapps.
The chair of Times Newspapers, which publishes The Times and Sunday Times, and the editor of The Spectator,both sit on the CPS board. All of the titles editorially support new North Sea oil and gas.
Richard Sharp, who was forced to resign as chairman of the BBC earlier this year over his connection to a secret £800,000 loan to Boris Johnson, sat on the CPS board for 19 years before joining the BBC in 2021.
The CPS, which does not disclose its funding, has offices on Tufton Street in Westminster, alongside several other “free market” pressure groups and think tanks, including the climate science denying Global Warming Policy Foundation.
Other board members include Rachel Wolf, a co-author alongside CPS Director Robert Colvile of the 2019 Conservative manifesto, which said the “North Sea oil and gas industry has a long future ahead” and supported a deal with the sector that allows for new drilling projects.
