The upstream oil and gas sector could possibly cut its emissions by 50 percent by 2030 through implementing cost-effective measures such as leaked gas recovery. This figure includes existing commitments, which account for 15 percent of methane abatement, plus a further 35 percent reduction with efforts by noncommitted players, Senior Partner Namit Sharma and coauthors note. Roughly 10 percent of total emissions are challenging to address, however, including a proportion of methane leaks and nonroutine flaring.
Image description:
A bar chart shows the global oil and gas marginal abatement cost curves, by 2030, measured in gigatons of CO2 equivalent per year of upstream oil and gas emissions on the x-axis (from 0 to 4), and abatement cost in US dollars per ton of CO2 equivalent on the y-axis (from –$300 to +$500). The chart highlights the potential abatement achievable through various measures. Under the 2030 commitments, an abatement of 15% is projected, represented by a collection of bars spanning from approximately 0 to 0.6 gigatons of CO2 equivalent per year. An additional 35% abatement is projected from implementing net-present-value-neutral and low-cost levers by noncommitted players. This abatement is represented by bars spanning from ~0.6 to 2.0 gigatons of CO2 equivalent per year. Abatement measures are also categorized by color, with shades indicating energy efficiency and methane reduction; flaring reduction; carbon capture, utilization, and storage (CCUS); electrification; and the switch to low-carbon fuels.
Note: This image description was completed with the assistance of Writer, a generative AI tool.
Source: McKinsey Energy Solutions: Asset Decarbonization.
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To read the article, see “The true cost of methane abatement: A crucial step in oil and gas decarbonization,” November 21, 2024.