France’s total gives up the US oil lobby in terms of climate division

LONDON (Reuters) – France’s Total SE on Friday became the world’s largest energy company to drop its main oil and gas lobby in the United States due to disagreements over its climate policies and support for drilling regulations.

Total said he would not renew his membership in 2021 at the American Petroleum Institute (API) following a review of the lobby’s climate positions, describing them as only “partially aligned” with his own.

The exit from the strongest energy lobby comes before radical changes in US policy, and President Joe Biden promises to address climate change and bring the country to zero net emissions by 2050.

“As part of our climate ambition made public in May 2020, we are committed to ensuring, in a transparent manner, that the industry associations of which we are members adopt positions and messages that are aligned with those of the group in the fight against change. climate, “said Patrick Pouyanné, CEO.

The withdrawal highlights a growing rift between Europe’s top energy companies, which in recent years have accelerated emission reduction plans and the construction of large renewable energy companies and their US rivals Exxon Mobil Corp and Chevron Corp, which have survived largely increasing investor pressure to diversify.

Chevron does not intend to leave the API, said company spokesman Sean Comey. Exxon was not immediately available for comment.

The announcement puts pressure on Total’s European rivals, BP and Royal Dutch Shell, to follow suit after resisting the move in recent years.

BP, Shell and Equinor in Norway said on Friday they were reviewing members of trade organizations and how they were aligning with climate issues. Shell spokesman Curtis Moore said “API is approaching Shell’s own views” on climate change.

European oil companies have mentioned in the past the role of API in formulating safety and operating standards for the industry as a reason why they have remained in the group.

However, in the reasons for leaving the group, Total mentioned API’s support for last year’s downgrade of US methane regulations, its differing views on the price of carbon, and the lack of support for subsidies for electric vehicles.

API thanked Total for its membership, but noted that it does not support energy subsidies, saying it distorts markets.

“We believe that the world’s energy and environmental challenges are large enough to require many different approaches to address them, and we benefit from a variety of perspectives,” API said.

The group defended its record for combating carbon emissions, noting that technological advances in the industry have helped it reduce rates of carbon dioxide and methane emissions in large oil-producing regions.

Overall last year it announced plans to reduce carbon emissions, with the aim of achieving net emissions from its operations and its energy products sold to customers in Europe by 2050 or sooner.

Total’s operations in the United States include a series of offshore oil and gas fields in the Gulf of Mexico, a major refining and petrochemical plant in Port Arthur, Texas, and a renewable energy business. The company produced about 343,000 barrels of oil equivalent per day in the third quarter in America.

SIGNIFICANT MOVEMENT

Growing investor pressure has led Europe’s top energy companies to shape their plans to reduce emissions and increase renewable energy production.

“There is simply no justification for any association with lobby groups that overturn emission regulations and undermine urgent climate action,” said Jeanett Bergan, head of responsible investment at KLP, Norway’s largest pension fund, which manages assets. of $ 80 billion.

In total, BP and Shell have already given up on US fuel and petrochemical producers (AFPM), an American oil refining group, due to differences in climate policies.

The withdrawal from the API was more significant, said Andrew Logan, director of oil and gas programs and the CERES clean energy investor group, said the announcement was significant and would put pressure on other major European oil companies.

“Given the size and influence of API, this is a much more significant move than previous decisions to exit more niche trading groups, such as AFPM. I think we will see other companies following suit, “Logan said.