Occidental Petroleum Corp. CEO Vicki Hollub said on April 6 she opposes a carbon tax, an idea that has gained the backing of large rival oil companies and some trade groups.
“A carbon tax would be bad for a lot of the industry, a carbon tax would be bad for the consumers and especially for those consumers who are more disadvantaged from an economic standpoint,” Hollub told the virtual summit of the Texas Independent Producers and Royalty Owners Association.
The American Petroleum Institute (API), the largest U.S. oil and gas trade group, said last month that it endorses a carbon-price policy as one measure to mitigate climate change risk.
Oil majors Exxon Mobil Corp. and Chevron Corp. back the idea. Major U.S. financial trade groups have also called for some type of carbon pricing.
President Joe Biden’s administration is due to unveil a new economy-wide emissions reduction target for 2030 to comply with the Paris climate agreement by April 22, when Biden convenes world leaders on climate change.
Occidental collects carbon tax credits through its EOR operations. The method harnesses the CO₂produced during the extraction of oil and forces it back into the fields, which helps drive more oil to the surface.
The company has also set ambitious climate targets to reach net-zero emissions in its operations before 2040 and is trying to turn its low-carbon unit into a profitable business after it cut jobs and output last year when the coronavirus pandemic hammered global energy demand.
Unwinding tax breaks on fossil fuel companies could face opposition from Biden's fellow Democrats in the U.S. Congress from energy-producing states.
While a carbon tax may drive certain desired behaviors during the energy transition, there is no one solution to the world’s emissions woes, oil industry executives say.
Houston-based Baker Hughes said it will commit $60 million to the FiveT Hydrogen Fund, a unique new clean-hydrogen-only private infrastructure fund dedicated to delivering clean hydrogen infrastructure projects at scale.