EXPRESS #2 - July 10, 2018
Last month, a federal judge in California dismissed “climate lawsuits” filed by the cities of San Francisco and Oakland against the oil companies. In his decision, U.S. District Judge William Alsup wrote that the dangers of climate change are “very real” and that fossil fuel companies didn’t dispute that burning their products causes it, but that the issue should be handled by Congress rather than in a federal liability lawsuit.
However, although this outcome was disappointing for climate activists, this is far from the end of the story. On 2 July, the next lawsuit was filed – the first time by a U.S. state: Rhode Island.
As Inside Climate News writes, Rhode Island is suing “oil companies over the effects of climate change, filing a complaint seeking damages for the costs associated with protecting the state from rising seas and severe weather.”
Dramatically “standing atop a seawall in Narragansett, state Attorney General Peter F. Kilmartin compared the case to the lawsuits filed decades ago against tobacco companies and said it would hold the companies—including ExxonMobil, Chevron, BP and Royal Dutch Shell—accountable for harm they have caused.”
“Big oil knew for decades that greenhouse gas pollution from their operations and their products were having a significant and detrimental impact on the earth’s climate,” he said. “Instead of working to reduce that harm, these companies chose to conceal the dangers, undermine public support for greenhouse gas regulation and engage in massive campaigns to promote the ever increasing use of their products and ever increasing revenues in their pockets.”
The lawsuit, filed in Providence/Bristol County Superior Court, names 14 oil and gas companies and some of their affiliates, “saying they created conditions that constitute a public nuisance under state law and failed to warn the public and regulators of a risk they were well aware of.”
In response, Shell released a statement to Reuters saying that “lawsuits that masquerade as climate action and impede the collaboration needed for meaningful change” were not the answer to climate change.
Inside Climate News notes that “More than a dozen cities and counties in California, Colorado, New York and Washington have filed similar lawsuits against major fossil companies in recent months in attempts to hold them financially responsible for the effects of climate change. Many of those cases involve coastal communities—such as New York City and tiny Imperial Beach, California—that have seen the damage sea level rise can cause and are now looking for how to pay for protective infrastructure.”
Sen. Sheldon Whitehouse (D-RI), who spoke at the press conference announcing Rhode Island’s lawsuit, said the courts are an appropriate venue for action. “The fossil fuel industry is fond of saying, you’re in the wrong forum, you shouldn’t be going to the courts, you should be going to Congress,” he said. “The reason they say that is because they have Congress locked up with their political power and their money and their influence.”
Trouble brewing, therefore, for Big Oil. But who is Big Oil really nowadays? What are the biggest oil companies in the world – and how did they perform last year?
The most recent issue of the Quarterly Gas Review, written by Thierry Bros for the Oxford Institute for Energy Studies, provides a fascinating overview of the oil and gas production figures of the major “international oil companies” (i.e. excluding state-owned companies such as Saudi Aramco).
Here is the graph:
And here are some of the most important results, as described by Bros:
- Gazprom’s hydrocarbon production increased by 10.9% thanks to a 12.4% growth in gas. Gazprom is the biggest listed hydrocarbon producer but more importantly, with gas representing 87% of its total production, it is the biggest worldwide gas producer.
- Rosneft’s hydrocarbon production grew by 6.5% in 2017 vs 2016 thanks to its acquisition of the Russian Government stake (50.08%) in Bashneft in October 2016.
- PetroChina hydrocarbon production decreased by 0.6% as compared with last year (-3.7% for oil and +4.5% for gas).
- ExxonMobil’s hydrocarbon production was down again in 2017 (-1.7% in 2017 vs 2016 after -1.1% in 2016 vs 2015) mostly due to liquids (-3.5%). D
- Shell’s hydrocarbon production was stable in 2017 (-0.2%). Shell production is evenly split between oil and gas and, following the acquisition of BG, Shell should continue to target more gas than oil plays. Shell is now the second largest gas producing company, up from number 4 in 2015.
- Petrobras’ hydrocarbon production was flat again in 2017 (-0.8%).
- Total’s hydrocarbon production was up by 4.6% vs 2016 with oil up more than gas (+5.9% and +3.3% respectively).
- BP’s production is massively up by 11.7%, (without taking into account the 19.75% share it owns in Rosneft hydrocarbon production, to avoid double counting in this exercise). This is the second largest growth since production recorded in 2009 before the Macondo well disaster, which resulted in divestments to cover the clean-up. BP is now producing at the same level as in 201132 .
- Lukoil’s hydrocarbon production was flat (-0.3% in 2017 vs 2016) as oil production was negatively influenced by the decrease in compensation crude oil from the West Qurna-2 project in Iraq and external production limitations driven by the agreement between Russia and OPEC, while gas production increased by 15.8%.
- Statoil’s (now Equinor) hydrocarbon production grew by 5.2% in 2017 supported by a 13.7% increase in gas. Statoil is the Norwegian oil & gas company with gas representing 45% of total production.
- Eni is the Italian oil & gas company with the state still controlling a minority shareholding. Its hydrocarbon production rebounded in 2017 (+3.2%) due to a massive increase in gas (+9.6%).
One thing is clear: climate change or not, it’s business as usual for the oil companies.