Activists are dissatisfied with Chevron’s plans for new “lower carbon” ventures.
In response to mounting criticism from environmentalists, Chevron increased spending on “lower carbon” enterprises and announced plans to reduce emissions from its operations on Tuesday, in a pitch that garnered scoffs from climate activists.
The US oil giant said it would invest more than $10 billion on its “lower carbon operations” through 2028, including goods like aviation fuel manufactured from biofeedstocks rather than crude oil.
At the start of an investor presentation, Chief Executive Mike Wirth stated, “We believe climate change is real and that human activity, including the use of fossil fuels, contributes to it.”
“We believe that the future of energy will be low-carbon, and we want to lead the way.”
However, critics blasted the plan, which keeps the vast majority of Chevron’s capital spending dedicated to fossil fuels.
Chevron, like its American rival ExxonMobil, has been under increasing pressure from environmentalists and mainstream investors, with shareholders voting against their proposals at annual meetings earlier this year.
“We are glad that Chevron has finally expressed an interest in discussing the energy transition. Mark van Baal, founder of Follow This, a Dutch activist shareholder group, stated, “We’re glad that they’re increasing investment on lower-carbon energy.” “However, this is far from sufficient.”
Chevron’s increased investment in lower-carbon energy is “encouraging,” but Andrew Logan, director of the oil and gas program at activist non-profit investor group Ceres, said on Twitter that “it’s hard to see” how bringing renewable fuels to 7% of refineries nationwide by 2030 “will convince investors that it’s taking climate seriously.”
Many climate activists see the situation as a crisis, claiming that rising storms and forest fires demonstrate the need for quick action.
Executives described initiatives such as renovations to its El Segundo, California refinery to create renewable diesel and sustainable aviation fuel, as well as a joint venture with agribusiness Bunge to line up feedstocks for such fuels, during the 90-minute presentation to Wall Street analysts.
The company also discussed upgrades to upstream operations that will reduce emissions, such as the use of satellite technology to monitor for methane leaks in Kazakhstan and an upgrade to an offshore project in Nigeria that will reinject natural gas into the reservoir rather than flaring it into the atmosphere.
Even with the higher spending, Chevron’s traditional petroleum division will receive the majority of the company’s capital budget. Chevron announced in March that annual capital spending would range from $14 billion to $16 billion. Brief News from Washington Newsday.