Norwegian oil company Statoil has topped a list of international oil companies for having the best strategy for becoming much more climate-friendly. Statoil’s CEO Eldar Sætre gets much of the credit, as the company also claims to be working hard on improving safety.
Newspaper Dagens Næringsliv (DN) reported that the list of companies with the best climate strategy was compiled by the organization Carbon Disclosure Project (CDP), which analyzed strategies submitted by the world’s largest oil and gas companies. CDP is backed by 827 of the world’s largest institutional investors, who together manage hundreds of billions of dollars.
Statoil ranked number one, followed by Eni of Italy and Total of France, both of which are active in Norway. All five of the best oil companies, in terms of how they handle risks tied to climate change, were European, and lauded for their investments in gas projects and renewable energy resources while also adapting strategy more geared towards a society that relies on renewable instead of fossil fuels. Three of the world’s largest companies — Saudi Aramco, Petro-China and Rosneft – chose not to take part in the surveys on strategy submitted by the others.
Climate consciousness yields competitive edge
Statoil was predictably pleased to have topped the list. “We’ve carried out thorough and long-term work in the entire organization to reduce emissions,” Bjørn Otto Sverdrup, Statoil’s director of sustainability, told DN. “For us, this is an important competitive advantage on the way towards a lower-emission society.”
As climate experts mentioned at the recent meeting in Marrakech to help implement the UN’s Paris Agreement to limit global warming, green measures have become an issue more tied to profitability than politics. Companies that don’t cut emissions and adapt or promote a lower-emission society are not expected to be as profitable as those that do.
“In recent years we have professionalized the work, with clearer goals and better reporting,” Sverdrup told DN. “This year’s high score (on the CDP list) is nice recognition of that, shows we’re on the right track and gives us extra inspiration for continued leadership in the important climate area.”
It’s the first time CDP carried out a survey of how oil companies are meeting the climate threat. They were rated on a mix of strategy, production and emissions today. Anders Bjartnes, editor of Energi og Klima in Norway, wasn’t surprised that Statoil wound up best among the investors’ overview. He said Statoil also has a strategy for adapting to lower oil prices.
Asked whether Statoil has changed since Eldar Sætre took over as chief executive last year, Bjartnes said “absolutely. It’s much more clear that Statoil is taking climate work seriously.”
Safety strides, too
Statoil is also trying to show that it’s taking safety seriously after a string of accidents and serious concerns among labour unions and petroleum industry regulators. Earlier this month the company appointed a new chief operating officer, Jannicke Nilsson, to replace Anders Opedal, who will now lead Statoil’s operations in Brazil. Nilsson, who was promoted from running Statoil’s cost-cutting and efficiency program Step, thus joins Sætre’s senior management team.
The 50-year-old Nilsson promised major attention on safety issues. “The most important thing for me now, is to strengthen our work to improve safety throughout the company,” she told DN. “We are not happy about the incidents we’ve had recently.” She was referring to everything from a fatal helicopter crash last spring to well-control problems on the Troll field and problems on other fields and at the Mongstad refinery and power plant.
“We will work hard and systematically to improve,” Nilsson said, noting that investigations were underway into many of the recent incidents that have set off alarms. Asked whether they can be tied to the cost-cutting that’s been going on at Statoil for the past few years, she said no conclusions would be drawn until the investigations are completed.