The companies, which in the past have been criticized for not doing enough to tackle climate change or reduce greenhouse gas emissions, acknowledged that the current trend in greenhouse gas emissions is too high to meet the United Nation\'s target for limiting global warming by no more than 2 degrees.
Top oil and gas companies in Europe have urged governments around the world to introduce a pricing system for carbon emissions.
The comes as governments meet for two weeks in Bonn, Germany to work on a new UN Climate Change agreement to be signed at the end of the year in Paris, France.
The companies, which in the past have been criticized for not doing enough to tackle climate change or reduce greenhouse gas emissions, acknowledged that â€œthe current trendâ€ in greenhouse gas emissions is too high to meet the United Nation\'s target for limiting global warming by no more than 2 degrees.
The chief executives of BG Group, BP, Eni , Royal Dutch Shell, Statoil and France\'s Total said carbon pricing would reduce uncertainty and encourage the most cost-effective ways of reducing carbon emissions.
The letter sent the letter to France\'s Foreign Minister Laurent Fabius and Christiana Figueres, Executive Secretary of the UN Framework Convention on Climate Change (UNFCCC) say the oil industry faces challenge and that there is need to meet greater energy demand with less Carbon dioxide.
The six oil companies Chief executives say they firmly believe that carbon pricing will discourage high carbon options and reduce uncertainty that will help stimulate investments in the right low-carbon technologies and the right resources at the right pace.
The letter was has been published on the UN Framework Convention on Climate Change (UNFCCC) website.
The U.N. and World Bank have been advocating for policies that shift the responsibility to polluters to pay for carbon emissions.
According to a report published by the World Bank last week 40 nations and over 20 cities, states and regions now have a price on carbon dioxide (CO2) emissions, covering around 12 percent of annual global greenhouse gas emissions.
The value of global schemes to price carbon, including trading schemes and taxes, totaled almost $50 billion as of April 1, the World Bank said.
Governments from more than 190 nations from June 1 to June 11 meeting in Germany are working on a draft text for the climate change agreement to ahead of the 2015 climate change conference in France .below is a full letter from the six companies : Climate change is a critical challenge for our world. As major companies from the oil & gas sector, we recognize both the importance of the climate challenge and the importance of energy to human life and well-being.
We acknowledge that the current trend of greenhouse gas emissions is in excess of what the Intergovernmental Panel on Climate Change (IPCC) says is needed to limit the temperature rise to no more than 2 degrees above pre-industrial levels.
The challenge is how to meet greater energy demand with less CO2. We stand ready to play our part.
Our companies are already taking a number of actions to help limit emissions, such as growing the share of gas in our production, making energy efficiency improvements in our operations and products, providing renewable energy, investing in carbon capture and storage, and exploring new low-carbon technologies and business models.
These actions are a key part of our mission to provide the greatest number of people with access to sustainable and secure energy.
For us to do more, we need governments across the world to provide us with clear, stable, long-term, ambitious policy frameworks. This would reduce uncertainty and help stimulate investments in the right low carbon technologies and the right resources at the right pace.
We believe that a price on carbon should be a key element of these frameworks. If governments act to price carbon, this discourages high carbon options and encourages the most efficient ways of reducing emissions widely, including reduced demand for the most carbon intensive fossil fuels, greater energy efficiency, the use of natural gas in place of coal, increased investment in carbon capture and storage, renewable energy, smart buildings and grids, off-grid access to energy, cleaner cars and new mobility business models and behaviors.
Our companies are already exposed to a price on carbon emissions by participating in existing carbon markets and applying â€˜shadow\' carbon prices in our own businesses to test whether investments will be viable in a world where carbon has a higher price.
Yet, whatever we do to implement carbon pricing ourselves will not be sufficient or commercially sustainable unless national governments introduce carbon pricing even-handedly and eventually enable global linkage between national systems. Some economies have not yet taken this step, and this could create uncertainty about investment and disparities in the impact of policy on businesses.
Therefore, we call on governments, including at the UNFCCC negotiations in Paris and beyond to:
Introduce carbon pricing systems where they do not yet exist at the national or regional levels
Create an international framework that could eventually connect national systems. To support progress towards these outcomes, our companies would like to open direct dialogue with the UN and willing governments. We have important areas of interest in and contributions to make to creating and implementing a workable approach to carbon pricing, including:
1. Experience. For more than a century we have provided energy to the world. We are global in reach, closely familiar with managing major projects and risks of many kinds, and well-versed in trading and logistics. As we are already users of carbon pricing systems across the world, exchange of information at international scale could help to identify the best solutions.
2. Motivation. We want to be a part of the solution and deliver energy to society sustainably for many decades to come. Like our counterparts in other industry sectors we will play a key role in implementing the measures and deploying the technologies that will lead to a lower carbon future. Low carbon business models and solutions are fragile until they reach critical size, but with linked carbon pricing systems worldwide, uncertainty would be reduced and such solutions will start to create value for business more rapidly.
3. Pragmatism. We believe our presence at the table could be helpful in designing an approach to carbon pricing that would be both practical and deliverable, as well as ambitious, efficient and effective.
4. A forum for discussion. Our companies and others have come together under the auspices of the World Economic Forum to form the Oil & Gas Climate Initiative, or are members of the International Emissions Trading Association, the World Bank or the UN Global Compact Carbon Pricing initiatives. We believe these forums may offer an appropriate ground for public-private dialogue on how to price carbon into energy.
Practically, we and our senior staff will seek to engage and share our companies\' perspectives on the roleof carbon pricing in several important settings:in our meetings with Ministers and Government representatives.
Pricing carbon obviously adds a cost to our production and our products â€“ but carbon pricing policy frameworks will contribute to provide our businesses and their many stakeholders with a clear roadmap for future investment, a level playing field for all energy sources across geographies and a clear role in securing a more sustainable future.
- as we attend and address conferences
- as we hold engagements with our investors
- as we conduct meetings with other stakeholders including partners, suppliers, academics and researchers
- as we hold meetings for management and staff within our businesses.
We acknowledge the long-term challenge and appreciate that this will be transformative across the energy sector. Over many decades, our industry has been innovative and has been at the forefront of change. We are confident that we can build on our trajectory of innovation to meet the challenges of the future.
Each of us will copy this letter personally to key contacts among investors, governments, civil society and our staff.
BG Group plc - Mr. Helge Lund
BP plc - Mr. Bob Dudley
Eni S.p.A. - Mr. Claudio Descalzi
Royal Dutch Shell plc - Mr. Ben van Beurden
Statoil ASA - Mr. Eldar Saetre
Total S.A. - Mr. Patrick PouyannÃ©