Tue. Dec 7th, 2021

Crown Prince Mohammed bin Salman and his energy minister said OPEC member Saudi Arabia would tackle climate change while ensuring the stability of the oil market and emphasizing the continued importance of hydrocarbons.

They spoke at the Saudi Green Initiative (SGI), ahead of COP26, the UN climate conference in Glasgow at the end of the month, which hopes to agree on deeper emission reductions to tackle global warming.

“The Kingdom of Saudi Arabia aims to reach zero emissions by 2060 under its circular carbon economy program … while maintaining the kingdom’s leading role in strengthening security and stability in global oil markets,” Prince Mohammed said in recorded remarks.

He said the kingdom would join a global initiative to reduce methane emissions by 30% from the 2020 level by 2030, which both the US and the EU have been pushing for.

US climate envoy John Kerry is set to attend a broader Middle East Green summit in Riyadh on Monday.

Saudi Energy Minister Prince Abdulaziz bin Salman said Riyadh, who has signed the Paris Climate Pact, had already submitted his nationally determined contributions (NDCs) – targets for individual states during a global effort to prevent average global temperatures rises above 1.5 degrees Celsius above pre-industrial levels.

SGI aims to eliminate 278 million tonnes of carbon emissions per year, the Crown Prince said compared to a previous target of 130 million tonnes.

In March, Saudi Arabia promised to reduce CO2 emissions by more than 4% of global contributions. It said it would involve producing 50% of the energy needs from renewable energy by 2030 and planting billions of trees in the desert state.

Hydrocarbons are still needed

Saudi Arabia’s economy remains heavily dependent on oil income, as economic diversification lags behind the Crown Prince’s ambitions.

Saudi officials have argued that the world will continue to need Saudi crude oil for decades to come.

“The world cannot function without hydrocarbons, fossil fuels, renewable energy sources, none of which will be the saver, it must be a comprehensive solution,” the energy minister said.

“We must be inclusive, and inclusivity requires that we be open to accepting the efforts of others as long as they want to reduce emissions,” he said, adding that the young generation of the kingdom “will not wait for us to change their future.”

He said the goal of zero emissions might be achieved by 2060, but the kingdom needed time to do things “properly”.

The Gulf’s OPEC producer, the United Arab Emirates, this month announced a plan for zero emissions by 2050.

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The CEO of the United Arab Emirates oil company ADNOC, Sultan al-Jaber, also stressed the importance of investing in hydrocarbons, saying that the world had “sleepwalked” into a supply crisis and that climate action should not become an economic burden for developing countries. .

Saudi Arabia has been criticized for acting too slowly, with the Climate Action Tracker giving it the lowest possible rating of “critically inadequate”.

And experts say it is too early to say what the impact of Saudi Arabia’s budding solar and wind projects will be. The first renewable energy plant opened in April, and its first wind farm began producing electricity in August.

Mega projects, such as the futuristic city of NEOM, also incorporate green energy plans, including a $ 5 billion hydrogen plant, and Saudi state-affiliated entities revolve around green collection.

Some investors have expressed concern about the kingdom’s carbon footprint. Others say that Saudi Arabia emits the least carbon per barrel of oil and that de facto ruler Prince Mohammed is serious about economic diversification.

“Obviously, the carbon footprint is a problem. However, we want to emphasize that realistically, carbon will be slow to phase out, and oil is here for a while yet,” said Tim Ash at BlueBay Asset Management ie email comments.


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