WoodMac: Policy Uncertainty Clouds E&P’s Carbon Management Push

The lack of emissions guidelines could serve as a barrier to significant progress as E&P companies in the Lower 48 explore advancing carbon management technologies.

WoodMac: Policy Uncertainty Clouds E&P’s Carbon Management Push

Despite the uncertainty, WoodMac ​Rachel Schelble believes that most Scope 1 emissions targets by Lower 48 E&Ps could be addressed by the middle of the decade, with capex reaching about $100 million to achieve those goals. (Source: Shutterstock.com)

Even with commodity markets stabilized at high prices, the E&P sector is working to identify a balance between the shifting priorities of decarbonization and achieving climate goals while also growing production and ensuring energy security.

It’s seemingly a three-wire tightrope walk between appeasing investors who want both a return and prioritize rewarding those who achieve emissions reductions, a federal government whose tone has changed from restricting drilling to pushing for more production to combat high gas prices, offset import losses from Russia, and supply global markets who have similarly cut off Russian oil and gas.

“Lower 48 E&Ps are really working hard to strike the balance between energy security and the energy transition,” said Rachel Schelble, head of corporate carbon management and infrastructure at Wood Mackenzie, speaking recently at Hart Energy’s Carbon Management Conference in Fort Worth, Texas.

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Brian Walzel

Brian Walzel is senior editor for Hart Energy’s E&P Plus.