WoodMac consultancy predicts growth in oil production and an increase in carbon emissions. Prepare an action plan to control the emission rate.
Oil and gas industry is expected to see a 3% growth in global oil production in 2024 according to five forecasts by Wood Mackenzie, leading to an increase in emissions.
The oil and gas sector continues to play a crucial role in the global energy market, with the oil and gas industry expected to experience significant expansion in 2024, as predicted by Wood Mackenzie. This growth in Oil and Gas production will have implications for emissions levels in the industry.
Oil and Gas: Main trends for 2024
Let’s check out the main trends for 2024, according to the consultancy:
- investment in Oil and Gas will stabilize: Global spending will reach just over US$500 billion in 2024, an increase of just 2% from 2023 after an 18% increase over the past three years (in real terms).
- Increase in emissions of projects will test the relationships of the supply chain;
- Fusions and acquisitions will prioritize scale, asset performance and diversification in the oil and gas industry;
- Decarbonization gains will be reversed in 2024 in the oil and gas industry;
- US oil production will enter a new phase of growth, according to the consultancy.
Important details about trends
1. Investment in Oil and Gas will stabilize: The consultancy identified 45 projects in the final decision phase investment, which will require US $ 170 billion to develop 25,5 billion barrels of oil equivalent (boe).
2. Increase in project emissions will test supply chain relationships: Inflation, bottlenecks and price uncertainty will be the main challenges, according to Wood Mackenzie.
- The suppliers did not follow the recent increase in activity and projects are more complex, with a greater demand for efficiency and reducing emissions.
3. Mergers and acquisitions will prioritize scale, asset performance and diversification: The consolidation of the oil sector will maintain the pace of 2023, when major mergers were announced, such as Chevron-Hess and ExxonMobil-Pioneer.
– This movement will be driven by several factors, including operational and financial efficiency and, in some cases, emissions performance.
4. Some decarbonization gains will be reversed in 2024: The oil industry will continue to reduce emissions per barrel, but this will not be enough to offset the absolute increase in emissions.
– Scope 1 and 2 emissions in 2024 will increase by 12 million tons of CO2 equivalent in relation to 2023, estimates Wood Mackenzie.
5. US oil production will enter a new phase of growth: The region of USA known as the 'Lower 48', which excludes Alaska and Hawaii, will see slower growth after the rapid increase of the last two years.
– Oil production in the region will increase 180 thousand barrels per day in 2024, high of 2%, according to the consultancy.
Other highlights in the Oil and Gas sector
Oil industry against tax.charged from April in the state of Rio de Janeiro.
– Sector entities have met with law firms in recent weeks to prepare an action plan, which should be put into practice between the months of February and March, after the Judiciary recess.
- The Control, Monitoring and Inspection Fee for Oil and Gas Exploration and Production Activities (TFPG) was established through law 10.254/2023, sanctioned by governor Cláudio Castro (PL) on December 20th.
Carmópolis paid off. received from Carmo Energy to charge the late payment, which should have been made on December 20th.
– Carmo Energy purchased the asset in December 2021, for $1,1 billion. It paid a US$275 million deposit and another US$548 million in December 2022.
Vibra without Petrobras. ‘in current terms’. O contract ends on June 28, 2029.
– Vibra stated that it was already planning for the end of the contract and that the statement does not change the strategy the company.
- Among the brands are the ‘Postos Petrobras’ chain, the aviation kerosene brand ‘BR Aviation’ and the gasoline products ‘Podium’ and ‘Grid’.
- Petrobras back à fuel distribution? Understand what is at stake
Biodiesel import.stated that the suspension of approval for biodiesel imports by the National Energy Policy Council (CNPE) was important so as not to 'compromise the local biofuel industry' and generate 'investor instability'.
– The board also approved, on the same day, the anticipation of the increase in mandatory mixing of biodiesel in diesel: from 12% to 14%, in March 2024, and to 15%, in 2025.
Biodiesel trucks. is investing R$26,4 million to replace its fleet of diesel trucks with 24 Scania vehicles powered by 100% biodiesel, which should reduce CO95 emissions by 2%.
BYD's plan for Brazil. The Chinese BYD promises to verticalize all its production of electric vehicles in Brazil, from the exploration and processing of lithium, through the manufacture of batteries, to the production of buses and cars.
– The idea, according to the chairman of the Board of BYD Brasil, Alexandre Baldyin an interview with , it is to ‘make Brazil a regional in Latin America for BYD’.
- Unlike the rest of the world, in Brazil, the ethanol hybrid will also be part of the company's portfolio.
Global risks of 2024. The World Economic Forum's (WEF) Global Risks Report placed extreme weather events at the top of the list of the top 10 risks that global populations will face in the long term.
Incentive for debentures approved. sanctioned without vetoes, this Wednesday (10), law 14801/2023, with incentives for the issuance of debentures for investments in infrastructure. Experts say the measure could attract a new investor profile to the energy sector.
– The new debentures can be issued until the end of 2030, by specific purpose companies, concessionaires, permissionaires, authorizers or lessees, who will be able to deduct up to 30% from the IRPJ and CSLL calculation base of the sum of interest paid on the bonds.
Source: EPBR
