This week, BP projected that global demand for oil may have peaked in 2019 and that we shouldn’t ever expect demand to recover to pre-COVID-19 levels. On the face of it, BP’s analysis is stark, with global demand for oil reducing in all three of its scenarios over the next thirty years.
The degree and pace of the decline, according to BP, is dependent on the increasing efficiency and electrification of road transportation, highlighting how social and environmental considerations are increasingly becoming crucial considerations for companies, governments, consumers and investors in the move away from carbon-emitting fuels.
We, at Reabold, recognise the trends of the energy revolution, but also very much believe that both oil and gas will be a part of energy supply for some time yet. We believe that the dramatic shift will be in where and how the hydrocarbons are sourced, with a focus on producing energy in the least carbon intensive manner. Extraction of oil and gas from fields with a low carbon intensity has the benefit of being more environmentally friendly and can also provide the opportunity to develop resources at a lower cost, which is of particular importance given the currently depressed oil and gas prices.
This presents an opportunity for projects such as West Newton, which is an extremely low-carbon prospect having received the best grade for low carbon intensity (AA) by GaffneyCline in a recent report. With West Newton containing carbon intensities “significantly lower than the UK average and also compared to onshore analogues” it is likely more capital will be deployed into these types of projects going forward.
Reabold is proud of its commitments to Environment, Social and Governance (ESG) considerations, which is not only evidenced by the strong low carbon credentials of West Newton, but also through its location being at the heart of the Zero Carbon Humber project area, which aims to promote decarbonising technologies across industrial activities in the wider Humber region. Reabold’s focus on environmentally and socially responsible sources of energy comprises a significant part of our decision making as we look to facilitate the trend towards low carbon intensive sources of energy production for the benefit of our investors, business partners, consumers and wider stakeholders.