Oil giants invest in exploration
Oil and gas corporations are using their immense profits gained from the increase in fossil fuel prices caused by the conflict in Ukraine to ramp up their search for fresh reserves, disregarding multiple pleas from the United Nations to gradually eliminate the use of hydrocarbons in order to prevent a climate catastrophe.
Data and industry executives discovered that the resurgence of exploration is a result of the demand from a large number of investors who want to maximize their profits in the oil and gas industry instead of putting their money into less profitable renewable energy ventures.
According to the predictions of the International Energy Agency, investments in oil and gas exploration and production worldwide are expected to rise by approximately 11 percent, reaching a remarkable $528bn by 2023. This surge in investment is anticipated to reach its highest point since 2015.
According to Barclays, the number of offshore projects anticipated to receive approval this year is expected to reach its highest level in a decade.
The increased demand for oil and gas reserves and production, especially among European major companies, follows the decision by Shell and BP to scale back their efforts to transition towards renewable energy and instead focus on their traditional business.
Historically, the profits generated from the exploration and extraction of oil and gas resources have ranged from 15 to 20 percent, whereas the majority of renewable energy projects have yielded returns of up to 8 percent.
Research on data from oil services company Baker Hughes revealed that the quantity of offshore drilling ships utilized for oil and gas exploration and production has bounced back to levels seen before the pandemic. Specifically, there has been a significant increase of 45 percent since reaching its lowest point in October 2020.
Wood Mackenzie experts projected a sustained surge in operations, estimating that offshore exploration and drilling endeavors will expand by 20 percent come 2025.
The research and advisory organization from the United Kingdom also forecasted the investment of approximately $185 billion in the exploration and extraction of 27 billion barrels of oil reserves. These investments will primarily be directed towards the more expensive and more profitable deep-water projects, attracting international oil companies.
Nambia, a nation in Southern Africa that has not yet tapped into its oil and gas reserves, garnered significant attention when Shell and TotalEnergies uncovered oil and gas deposits in its offshore regions.
Meanwhile in China, a prominent player in wind and solar investments, expresses the need for additional power plants running on coal as economic growth dipped and scarcities resulted in power outages and halting of manufacturing units.
Despite Beijing's efforts to increase its reliance on renewable energy sources, the country has simultaneously been building an escalating number of coal-based power plants in recent times.
Temperatures have achieved unparalleled levels across the globe as the objective of limiting long-term global warming to a 1.5C (2.7F) threshold slips further away.
The leader of the United Nations, Antonio Guterres, has consistently cautioned world leaders about the crucial decision they must make: either collaborate or face the devastating consequences of global warming, which could amount to nothing less than the destruction of humanity.
While diplomats convened in Bonn in early June to get ready for the upcoming yearly climate negotiations in November, the Copernicus Climate Change Service, which is supported by the European Union, reported that the average worldwide surface air temperatures exceeded 1.5C compared to levels from before the industrial era for a number of consecutive days.
Certain regions in North America experienced temperatures that were approximately 10 degrees Celsius higher than usual for this time of the year. In addition, smoke originating from wildfires covered vast areas of Canada and the United States.
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