IRVING, TX: Responding to a shareholder initiative for information on its asset risk policy due to climate change, ExxonMobil says it has no plans to leave any oil in the ground as it will be needed to meet future global energy demand.
"Our analysis and those of independent agencies confirms our long-standing view that all viable energy sources will be essential to meet increasing demand growth that accompanies expanding economies and rising living standards," said William Colton, ExxonMobil's vice president of corporate strategic planning.
The company's announcement coincides with the latest UN Intergovernmental Panel on Climate Change (IPCC) report that says the effects of climate change are already occurring on all continents and across the oceans. It adds that in many cases, the world "is ill-prepared for risks from a changing climate."
Responding to the idea of oil sequestration in order not to exceed global warming by two degrees Celsius by 2100, ExxonMobil says this "low carbon scenario" would, by 2030, cost the average American household an additional $2,350 per year for energy, or five percent of total before-tax median income.
As a result, ExxonMobil thinks such costs would have an impact that is "beyond those that societies, especially the world's poorest and most vulnerable, would be willing to bear."
The company also cites a 2008 report by the International Energy Agency that says the cost of reducing greenhouse gas emissions to 50 percent below 2005 levels by 2050 would require the annual building of 24-32 one-thousand-megawatt nuclear plants, 30-35 coal plants with carbon capture and sequestration capabilities, and 3,700-17,800 wind turbines of four megawatt capacity - at a total cost of US$45 trillion.
"The risk of climate change is clear and the risk warrants action," said Colton who added: "ExxonMobil is taking action by reducing greenhouse gas emissions in its operations, helping consumers reduce their emissions, supporting research that leads to technology breakthroughs and participating in constructive dialogue on policy options."
Vicente Barros, co-chair of the IPCC Working Group II noted: "We live in an era of man-made climate change. In many cases, we are not prepared for the climate-related risks that we already face. Investments in better preparation can pay dividends both for the present and for the future."