PDO commits to net zero emissions by 2050

MUSCAT, Sept 11: Joining the ranks of leading international organisations pledging steep cuts in their CO2 emissions, Petroleum Development Oman (PDO) – the country’s biggest oil and gas producer -- has outlined a far-reaching strategy to become a carbon-neutral energy producer by 2050.

Steve Phimister (pictured), Managing Director, said the company’s decarbonisation roadmap encompasses initiatives to, among other things, slash climate-change causing CO2 emissions, reduce flaring, improve energy efficiency, and invest in renewable and alternative energy solutions.

“At PDO, we have set ourselves some strong targets, and like many others around the world, we are committed to Net Zero by 2050, and a significant step-change of halving our emissions base by 50 per cent by 2030,” he stated.

Phimister, who was appointed to helm the majority state-owned company in July, made the announcement during a ‘Ministerial Dialogue’, jointly hosted by Oman’s Ministry of Energy and Minerals and the International Energy Agency (IEA) on Thursday.

Dr Mohammed bin Hamad al Rumhy, Minister of Energy and Minerals, also addressed the virtual session, which focused on the theme, ‘Clean Energy Transitions and Economic Resilience in the Middle East and North Africa’.

A ‘decarbonisation roadmap’ initiated a couple of years ago envisions as many as over 150 “opportunities” to tackle PDO’s carbon footprint, according to the Managing Director.

“It’s well-structured around six pillars, going from energy efficiency to power generation, management of wells and reservoirs, but also flaring and venting, carbon offsets, and a shift in portfolio and culture. So it’s all encompassing!”

Significantly, renewable power will receive strong attention as part of this strategy, Phimister noted. Renewable capacity, currently amounting to around 100 MW of solar-based capacity -- which equates to about to 10 per cent of PDO’s total power capacity -- will be ramped up to 30 per cent by 2025, ultimately rising to 50 per cent by 2030. In conjunction with this effort, distribution networks are being strengthened across the length and breadth of the country, in collaboration with the government, he said.

Also ambitious is the company’s strategy to reduce flaring, which accounts for about 20 per cent of its emissions base.

Routine flaring, accounting for a quarter of the emissions, is proposed to be eliminated well before the 2030 deadline set by the World Bank. Non-routine flaring will be dramatically whittled down through flaring reduction projects, said Phimister, adding that in 2020 alone, flaring was slashed by around 30 per cent compared with 2019 levels.

The official however stressed PDO’s commitment to balancing climate change mitigation objectives with continuing support for Oman’s economic development.

“At PDO we have a very clear objective to continue to provide energy to our customers but also a very substantial contribution to the Omani economy, and we must do that sustainably. And therefore we are committed to the Oman Energy Masterplan 2040 and we will seek to turn the climate change realities into real opportunities as energy demand rises.”

He further stated: “I am a believer that oil and gas will remain fundamental to our energy mix, but we also have to develop new energy solutions to sustain growth opportunities not only for PDO but the whole nation. I think that will mean moves into decarbonising power markets, growing Omani low carbon business chains and accelerating developments in solar, hydrogen wind and other low-carbon alternatives like hydrogen.”

PDO’s vision to develop new solutions and technologies to decarbonise its operations will inevitably unlock opportunities for the growth of alternative fuels and other energy products which in turn will help decarbonise the Omani industry as well. This will translate into opportunities to expand the company’s existing investments in renewable power, and new businesses and value chains in hydrogen, ammonia and carbon capture and storage (CCS), he added.