Tullow Oil has committed to becoming a Net Zero company by 2030 on its Scope 1 and 2 emissions. We will achieve this through a combination of decarbonising our operated assets in Ghana and through a nature-based carbon removal programme to offset our hard to abate emissions from power generation.
Over the last year Tullow’s emissions have been too high as a result of elevated levels of flaring required for better reservoir management and sustained production levels. The carbon intensity of production in 2020 was 29 kg CO2 e/bbl relative to an IOGP industry average of 18 kg CO2 e/bbl.
Tullow takes its impact on the environment very seriously and the decision to produce to flare from both our FPSOs has been a very difficult decision to take, but, after almost 10 years of excess gas injection on Jubilee a request to flare was made to protect the reservoirs and to maintain our oil production at our business planned levels. In addition, on our TEN FPSO, several Enyenra wells, due to progressive declining/reducing reservoir pressure, can recently only be produced into the FPSO by routing fluid to a separation vessel that has to operate at a pressure much lower than its original design intent. Low pressure separated gas from this vessel (up to 30MMscfd) is currently being flared, until such time as we install gas tie-in(s) to reroute this gas to the low-pressure section of FPSO gas processing train.
We plan to bring the carbon intensity of operations back in line with IOGP industry averages or lower by 2025 or sooner through our commitment to eliminate all routine flaring, which will allow us to reduce emissions on a net equity basis (accounting for emissions from our non-operated portfolio) by between 40-45%. One key project that will increase gas handling capacity on Jubilee is already underway and others, such as process modifications on TEN to routing tie-ins we are targeting to progress in our 2021 Key Performance Indicators (KPIs). Also part of our 2021 KPIs are plans to progress several NPV+ projects identified by the initial Net Zero study.
“In 2020 we set out to define a decarbonisation plan and determine a timeframe for our Net Zero commitment. These decarbonisation efforts will set Tullow on a path to reduce emissions on a net equity basis by 40 per cent relative to a 2020 baseline. Further identified emissions can reduce emissions by a further 5 per cent. Carbon offsetting will also be required to achieve a carbon neutral or Net Zero status, and work is underway to determine the right carbon offset strategy for Tullow.” - Rahul Dhir, CEO
To successfully eliminate routine flaring we will also need to secure long-term gas offtake agreements with the Government of Ghana. For 2021, our target is to achieve an offtake level between 100-135 mmscf/d to support oil production, which we are already successfully achieving today. There is strong alignment and a robust commercial foundation between the JV Partners and the Government of Ghana to achieve the targeted levels.
Tullow and its JV partners are also actively discussing a long-term firm gas supply and offtake agreement with the Government of Ghana which is anticipated to create material value to all parties involved and which underpins the projected outlook for the 10-year business plan. We are also working with GNGC on a firm gas offtake agreement. Two of our JV Partners have their own Net Zero plans, so this aligns with their overall corporate intent and we have also engaged them on our Net Zero plans as they have developed over the last few months.
Our residual hard to abate emissions – largely from power generation on the FPSOs – will be offset via nature-based carbon removal programmes focused in our key countries of operation. We will be looking to invest in new carbon offset projects in our key countries of operations over the next decade in order to offset its residual net equity emissions of ~600,000 tonnes of CO2e. As we intend to be the key investors of new projects, we will build this portfolio slowly with a view to be carbon neutral from 2030 onwards. Tullow has agreed the strategic objectives of its carbon offset programme with the Board and in 2021 will work to identify suitable projects for investment.