July 21, 2022 | News

Recent research has identified and located the world’s largest fossil fuel extraction projects. These 425 ‘climate bombs’, spread across 48 countries, are coal, oil and gas infrastructures that could emit more than 1 billion tonnes of CO2 over their lifetime. If all of them were to be mined to completion, their combined potential emissions would be twice the emissions cap that must not be exceeded if global warming is to be held to 1.5°C above pre-industrial levels. Clearing these climate bombs, i.e. preventing these projects from starting or being completed, is imperative.

Each of these projects is like a 1000 franc note left in the middle of St. Francis Square. What is the likelihood that this note will not be pocketed by a passer-by within a few minutes? Or are they of the same nature as a piece of building land that one would like to
to be downgraded to an agricultural zone in the hope of the owner’s smiling approval. Obviously, it is very naive to think that the owners of these assets will voluntarily give up exploiting them! And this is not just about private gain: the Norwegian state has just commissioned the largest oil and gas field in Europe!

So what should we do? Many people seem to think that weaning the owners of these assets from financing, i.e. putting pressure on the banks and investors, is the only way to get them to give up exploiting these resources. This is a complete illusion. The vast majority of these fossil resource owners are states or state-owned companies – (listed companies were responsible for only 20% of global industrial greenhouse gas emissions in 2015) – and large companies that do not rely on external financing to exploit their resources. And in the remaining cases it is absolutely impossible to prevent private financiers – investment or private equity funds – which are not subject to the control of banks or investors in the public markets – from helping companies to collect their 1000 franc note by appropriating a fraction of it for services rendered.

We are in fact in a situation where there is no alternative to public power. Firstly, and most radically, by pushing the States to refuse to grant authorisation to operate. But the Norwegian case shows that this is difficult if the corresponding financial loss (for the shareholders but also for the voters of the policy-makers) is too high. Lobbying is massive at all levels and so far there are few encouraging cases.

The only option is therefore to melt the value of the 1000 franc note! The surest way to avoid exploiting this fossil fuel is to learn to do without it and to make it uneconomic to exploit. The real decision-makers are the people who demand fossil fuels and it is at their level that the challenge can be met, not otherwise. Of course, governments have a decisive role to play here too: they must force the pace of fossil product renunciation, massively encourage the transfer to renewable energies and urgently ban the use of polluting equipment for which substitutes already exist.

By Jean-Pierre Danthine, Managing Director, E4S

Originally published in French in Le Matin Dimanche