2 degrees of separation:

Transition risk for oil & gas in a low carbon world

NEW REPORT

Breaking the Habit

Why none of the large oil companies are “Paris-aligned”, and what they need to do to get there


This report provides an update to our 2017 and 2018 “2 Degrees of Separation” reports, along with an updated methodology.

The most common climate-related question facing investors – “how can we tell if a company is aligned with Paris”? Carbon Tracker’s framework for addressing this challenge in the oil and gas sector is based solely on the economics of potential project portfolios.

Every oil major is betting heavily against a 1.5˚C world and investing in projects that are contrary to the Paris goals

Andrew Grant, Senior Oil & Gas Analyst

In this report, we lay out our approach and apply it to a universe of the largest listed oil and gas producers. For the first time, we look at alignment in terms of short term actions – which individual projects are non-Paris compliant and shouldn’t go ahead in an economically rational Paris-aligned world, yet nonetheless either a) were sanctioned last year; or b) are targeting sanction this year.

Company Name Country of Headquarters % of NPS potential capex outside 1.7-1.8°C/SDS budget (% band, unsanctioned only) % of NPS potential capex outside 1.6°C/B2DS budget (% band, unsanctioned only) Quartile SDS BudgetQuartile B2DS Budget
Apache

United States

30 - 40%

50 - 60%

4

4

Arc Resources

Canada

0 - 10%

50 - 60%

2

4

Concho Resources

United States

40 - 50%

60 - 70%

4

4

Ecopetrol

Colombia

20 - 30%

40 - 50%

4

4

Energen

United States

50 - 60%

50 - 60%

4

4

ExxonMobil

United States

20 - 30%

40 - 50%

4

4

Galp Energia SA

Portugal

10 - 20%

40 - 50%

3

4

Gulfport Energy

United States

20 - 30%

50 - 60%

3

4

Husky Energy

Canada

20 - 30%

60 - 70%

3

4

Imperial Oil (Public Traded Part)

Canada

20 - 30%

60 - 70%

4

4

Marathon Oil

United States

10 - 20%

50 - 60%

3

4

Petrobras

Brazil

20 - 30%

40 - 50%

4

4

QEP Resources

United States

10 - 20%

50 - 60%

2

4

Sinopec

China

30 - 40%

40 - 50%

4

4

Surgutneftegas

Russia

20 - 30%

40 - 50%

4

4

Tullow Oil

United Kingdom

30 - 40%

40 - 50%

4

4

Vermilion Energy

Canada

30 - 40%

50 - 60%

4

4

WPX Energy

United States

40 - 50%

60 - 70%

4

4

Aker BP

Norway

20 - 30%

40 - 50%

3

3

CNOOC

China

20 - 30%

30 - 40%

3

3

ConocoPhillips

United States

0 - 10%

30 - 40%

2

3

Crescent Point Energy

Canada

40 - 50%

40 - 50%

4

3

Encana

Canada

10 - 20%

30 - 40%

3

3

Equinor

Norway

20 - 30%

40 - 50%

3

3

Gazprom

Russia

10 - 20%

30 - 40%

3

3

Hess

United States

20 - 30%

40 - 50%

4

3

Lukoil

Russia

20 - 30%

40 - 50%

3

3

Murphy Oil

United States

20 - 30%

30 - 40%

4

3

Occidental Petroleum

United Kingdom

0 - 10%

30 - 40%

1

3

OMV

Austria

20 - 30%

40 - 50%

3

3

Parsley Energy

United States

0 - 10%

40 - 50%

1

3

Range Resources

United States

10 - 20%

30 - 40%

2

3

Repsol

Spain

20 - 30%

30 - 40%

4

3

Rosneft

Russia

20 - 30%

40 - 50%

3

3

Shell

Netherlands

20 - 30%

30 - 40%

3

3

Total

France

20 - 30%

30 - 40%

4

3

Anadarko

United States

0 - 10%

10 - 20%

2

2

BHP Billiton

Australia

0 - 10%

20 - 30%

1

2

BP

United Kingdom

10 - 20%

20 - 30%

2

2

Canadian Natural Resources (CNRL)

Canada

20 - 30%

20 - 30%

3

2

Cenovus Energy

Canada

10 - 20%

20 - 30%

2

2

Chesapeake

United States

0 - 10%

20 - 30%

2

2

Chevron

United States

10 - 20%

30 - 40%

3

2

Cimarex Energy

United States

0 - 10%

20 - 30%

1

2

Continental Resources

United States

0 - 10%

20 - 30%

2

2

Devon Energy

United States

20 - 30%

30 - 40%

4

2

Eni

Italy

10 - 20%

30 - 40%

3

2

EOG Resources

United States

0 - 10%

20 - 30%

1

2

Newfield Exploration

United States

10 - 20%

20 - 30%

2

2

Noble Energy

United States

0 - 10%

20 - 30%

2

2

Novatek

Russia

0 - 10%

20 - 30%

1

2

PetroChina

China

10 - 20%

20 - 30%

3

2

Santos

Australia

0 - 10%

10 - 20%

2

2

Suncor Energy

Canada

10 - 20%

10 - 20%

3

2

Antero Resources

United States

0 - 10%

0 - 10%

1

1

Cabot Oil and Gas

United States

0 - 10%

0 - 10%

1

1

Diamondback Energy

United States

10 - 20%

10 - 20%

2

1

EQT Corporation

United States

0 - 10%

10 - 20%

1

1

Inpex

Japan

0 - 10%

10 - 20%

2

1

Lundin Petroleum

Sweden

0 - 10%

0 - 10%

1

1

Oil Search

Papua New Guinea

0 - 10%

0 - 10%

1

1

Origin Energy

Australia

0 - 10%

0 - 10%

1

1

Peyto

Canada

0 - 10%

10 - 20%

1

1

Pioneer Natural Resources

United States

0 - 10%

0 - 10%

1

1

RSP Permian

United States

10 - 20%

0 - 10%

2

1

Sasol

South Africa

0 - 10%

10 - 20%

1

1

Saudi Aramco

Saudi Arabia

0 - 10%

0 - 10%

1

1

Seven Generations Energy

Canada

0 - 10%

0 - 10%

1

1

Southwestern Energy

United States

0 - 10%

0 - 10%

1

1

Tatneft

Russia

0 - 10%

10 - 20%

2

1

Tourmaline Oil

Canada

0 - 10%

0 - 10%

2

1

Woodside

Australia

10 - 20%

10 - 20%

2

1