Dan Klein, head of future energy pathways at Platts Analytics, remarked:
- We do not expect Middle Eastern countries to meet net-zero pledges on schedule, largely due to the need to reduce emissions in sectors that are difficult to decarbonize, and the general high cost
- The biggest challenge that Middle Eastern countries face to achieve net-zero is decarbonizing their industrial and refining sectors, where electricity cannot be used in all instances
Moreover, industry emissions from gas are expected to climb by 2 % in 2022, more than making up for a 0.3 % drop in oil emissions in the industry, while the gas emissions growth in the industry is just above the global growth of 1.94 %, but the world economy is more diverse with potential to embrace new technologies such as electric vehicles, Klein added.
Vandana Hari, founder and CEO of Vanda Insights, commented:
- I see only one way out - oil and gas companies need to double down on investment in R&D for carbon capture, utilization and storage technology, accelerate pilot projects that can become role models and pull out all the stops in educating the public about this mitigation technique
- So far, carbon capture and storage is the only savior on the horizon for countries wanting to continue pumping oil and gas
- But it is expensive and also gets a bad name because, unfortunately, some view it as no more than a cover for continued production and use of polluting fossil fuels
After the small drop in Middle East emissions from the oil used in industry in 2022, the sector will show growth every year through at least 2040, according to the analysis.
Analysts expect Middle East to meet net-zero targets
S&P Global Platts informed that most analysts in an informal survey said they expect the Middle East countries to meet their net-zero targets.
According to one respondent:
- UAE and Saudi Arabia should meet their objectives and I would expect Saudi Arabia to do so well ahead of its 2060 target
- Bahrain has less capital to invest in the transition and downstream industry is a sizable part of its small economy, so right now its target looks the most challenging
The UAE is also actively working on its net-zero target and in line with this, 2 UAE-controlled oil and gas giants revealed a $3.6 billion project earlier in December.
The strategic project aims to decarbonise offshore operations as part of the firms’ efforts to reach their net-zero goals and support the UAE’ Net-Zero by 2050 Strategic Initiative.
A few days ago, Jan De Nul and Samsung C&T consortium secured a cable installation contract to deliver an HVDC cable and convertors package for this ADNOC-TAQA Lightning Project.
This electrification project is expected to reduce the carbon footprint of ADNOC’s offshore operations by more than 30 %, replacing existing offshore gas turbine generators with more sustainable power sources available on the Abu Dhabi onshore power network.
The S&P Global Platts Analytics reported on Friday that Saudi Arabia and the UAE want to increase oil & gas production while curbing emissions, adding that one of the survey respondents stated:
- Decarbonizing upstream production is doable
- Question is how much demand there will be if other countries also hit net-zero goals
Renewables, led by solar to dominate in Middle East’s strategy to curb emissions
Ways to cut emissions in industry and refining are skewed toward hydrogen and CCUS, according to Klein, who added:
In this regard, the Middle East may be positioned to help other countries outside the region achieve their own net-zero targets either by serving as a major source of global green hydrogen supply or by unlocking potential applications of captured CO2 from other countries for use in enhanced oil recovery.
S&P Global Platts launched in November low-carbon hydrogen assessments in the Middle East as the region strives to become a major exporter of the fuel.
This assessment concluded that renewables, led by solar, will be the dominant way to curb emissions in the Middle East.
Furthermore, installed solar across the Middle East and North Africa is expected to reach 31 GW by the end of 2026, up from about 10.5 GW installed at the end of 2021, while wind capacity in the region is expected to reach 9 GW by the end of 2026 versus about 5 GW currently operational, according to Platts Analytics.
Another survey respondent added: