What the oil firms are doing

LONDON, England (CNN) -- As Europe tries to persuade U.S. President George W. Bush that the Kyoto agreement on cutting emissions that cause global warming is worth implementing, oil companies are debating how far to embrace change.

The corporate approach reflects world politics, with big European oil firms taking a more progressive approach to global warming than their American counterparts, according to pressure group Friends of the Earth.

While the world's largest oil firm, ExxonMobil, continues to deny the existence of the problem and has resisted change, Europe's large oil companies, such as Shell and BP, have not, Mark Johnson of Friends of the Earth told CNN.

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However, there is a great deal of debate within the industry as to how far and how fast change should be implemented, according to Greenpeace.

Neither Shell nor BP have endorsed the Kyoto Protocol, although last year they left the Global Climate Coalition, a Washington-based organisation that campaigns against the agreement.

Both companies have made moves to invest in renewable energy forms.

BP

BP is one of the biggest players in the currently small solar energy generation market, but says it expects revenues to grow to about $1 billion a year by 2007.

The company also says the addition of Amoco and Arco to the group has boosted gas as a proportion of its output from about 15 to 38 per cent. This figure is expected to rise to about 45 per cent by 2003.

BP says that makes it almost as much a gas company as an oil company -- and as gas is a more efficient fuel with lower emissions, it is moving towards increasingly cleaner, greener energy.

However, the firm plans to invest 50 times more in oil exploration and production than in renewable energy over the next three years -- something that pressure groups such as Greenpeace are unhappy about.

The company has been asked by campaigners to produce a report by the end of the year on how it plans to make the transition from fossil fuels to renewable energy.

A report by financial analysts Innovest calculates that BP stands to lose 5% of earnings from falling petrol sales as the market for greener fuel technology expands and regulations to reduce carbon dioxide emissions tighten.

Shell

Shell has set up Shell Renewables to develop commercial opportunities in solar, biomass and wind energy.

The company says it plans to be a significant player in the sustainable energy market and has been assessing renewable technologies for almost 20 years.

Most of the effort is concentrated on emerging markets in developing countries, although Shell Renewables was recently chosen to look into developing one of the UK's first offshore wind farms in the Irish Sea near Blackpool. If it goes ahead, the project could produce enough electricity for 40,000 households.

The UK is one of the windiest countries in Europe and the government calculates that it has enough offshore wind practically available to supply about a third of the country's total electricity demand.

Texaco

Texaco says it shares society's concern over the issue of climate change and believes that enough is known about it to warrant action now.

The company says it actively addresses the issue of climate change by using technology in its own operations to improve energy efficiency and cut emissions.

It is also creating new businesses to develop environmentally smart technologies such as fuel cell and geo-thermal, both of which emit no greenhouse gases.

In a July 2000 report by Innovest, Texaco was ranked fifth of 17 global integrated oil and gas companies based on its response to environmental trends.

The same report put Shell and BP in first and second place respectively and ExxonMobil in sixth place.

The report said concerns over climate change were providing growth opportunities for clean fuel technologies and that adjusting company portfolios to take advantage of such opportunities would be a key aspect of the energy industry in the future.

Shell
BP
Texaco
Innovest

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