Saudi Aramco, the world’s largest oil-exporting company, aims to achieve an ambitious target of net-zero carbon emissions by 2050, its president and chief executive said hours after the kingdom said it aimed to neutralise its emissions by 2060.
There is a need to work on existing energy sources in parallel with investing in new sources, Amin Nasser said during the Saudi Green Initiative forum on Saturday.
"Saudi Aramco will aim to achieve the ambition of being net zero from our operations by 2050," he said.
“The road will be complex but I am confident we can meet them and accelerate our efforts to a low-carbon future."
As the Cop26 climate summit approaches at the end of the month, several countries have pledged to aim for net-zero emissions by 2050, while global airlines, banks and other companies are also targeting the mid-century goal.
Mr Nasser also urged countries not to "demonise" hydrocarbons as the world rapidly transitions to cleaner forms of energy.
"What we need to do is work in parallel: we need to work on our existing sources of energy and, at the same time, [bring] in new sources of energy like renewables and hydrogen, and this is exactly what we’re doing," Mr Nasser said.
Adequate crude oil spare capacity needs to be in place in order to ensure energy security and prevent shortages, he added.
The oil giant is investing to expand its capacity to 13 million barrels per day, grow its gas-processing capacity and eliminate liquid burning in the kingdom.
"While maintaining our existing resources and growing it over the next 10 years, we will be achieving net zero by 2050, so we’re not abandoning our existing sources of energy, at the same time we have big investment in renewables through hydrogen, non-combustible uses of oil like crude to chemicals, non-metallics," Mr Nasser said.
"So we’re investing in new sources of energy but at the same time, we’re not abandoning our existing sources."
Mr Nasser said he saw a decline in spare capacity due to a sharp drop in investments over the past seven years.
"Today there is only three [million] to four million barrels and it is declining fast," he said.
"If the airline industry opens up, the shortage in the airline industry is close to three million barrels today, if that picks up, it will eat the spare capacity that is available."
Global airlines expect losses in 2022 to drop to $11.6 billion after registering a $51.8bn loss in 2021 as aviation makes an uneven recovery from the coronavirus pandemic, industry body the International Air Transport Association said at its annual general meeting in Boston this month.
"We need to maintain investments in existing resources," Mr Nasser said.
"Oil and gas will continue to be a part of the energy mix for decades to come and we need to invest in that."
Affordability, reliability and global energy security is important or the world risks an economic crisis, he said.
"Investments in technology will help reduce the costs of carbon capture and sequestration," Mr Nasser said, adding that Saudi Aramco was investing in blue hydrogen and green hydrogen projects.
Asked what he expects from the Cop26 meeting, Mr Nasser said there was a need for an orderly transition and a holistic view of energy security otherwise the world risked an economic crisis.
"We need policies that are inclusive, not divisive," he said.
Patrick Pouyanne, chief executive of TotalEnergies, said excluding oil and gas was not the correct answer to an energy transition, because a lack of investment in hydrocarbons could in itself create a crisis.
He said the recent jump in gas prices was due to a "strong rebound" in post-Covid demand and that prices could stabilise "after winter time".