The FT has reported this morning that:
New Zealand has become one of the world's first countries to ban future offshore oil and gas exploration in a move heralded by environmental campaigners as a symbolic blow to “Big Oil”.
The South Pacific nation's ban is an important policy move at a time when nations are exploring how to comply with their requirements under the Paris climate change agreement.
I think it was just coincidence that the FT also reports this morning that:
Royal Dutch Shell said it saw little risk of being left with “stranded assets” as the world begins to shift away from fossil fuels and promised to keep pace with the global transition to cleaner energy. The Anglo-Dutch group said 80 per cent of its current proved oil and gas reserves would be produced by 2030, when it expects demand for those hydrocarbons to be higher than it is today even under its most aggressive scenario for growth in alternative forms of energy.
The issue is threefold. First, we know we need to burn less. There is no doubt about that, Full marks to New Zealand then.
Second, most extractive companies are valued not on their current profits but on the reserves that they hold. And as my old friend and fellow Green New Dealer, Jeremey Leggett, has long suggested, most of their known reserves are going to have to stay in the ground if the world is not to fry.
So, third, we face both a massive energy crisis and a financial one too as the enormous valuation placed on those reserves in the world's financial markets collapses, as surely it will.
New Zealand has made a smart move. Shell is just blustering. The writing is on the wall. For pension funds and others following New Zealand's example and getting out of fossil fuel now might be the very best thing that they can do. Oil is going to have to stay in the ground, whatever the impact on profits. And we'll all have to pay the price for that.
Thanks for reading this post.
You can share this post on social media of your choice by clicking these icons:
You can subscribe to this blog's daily email here.
And if you would like to support this blog you can, here:
Completely agree. We should not think about looking for new fossil fuels until we are back below 350 ppm of atmospheric CO_2 (or better 300 ppm) , see e.g. https://350.org/science/#causes
Any other plan will be very damaging.
Petroleum is useful for many purposes other than burning it in automobile engines
And it still burns the planet
And provides for the growing of food. We need many ,many tonnes of fertiliser. I accept the “burning” bit however its a no brainer.
“And provides for the growing of food. We need many, many tonnes of fertiliser.”
… but the manufacture of fertilisers contributes to climate change. Also, a speaker on Radio 4’s ‘Inside Science’ said current output relies on “spraying fields 17 times” with herbicides and insecticides (Other research has also revealed that 75% of all flying insects have disappeared in Germany and probably much further afield, prompting warnings of “ecological armageddon”.) Soil is being depleted at alarming rates. These methods are not sustainable. What’s more, one third of the food produced is wasted!
Using compost agriculture – and none of these expensive insecticides, herbicides and fertilisers, organic farming currently produces 80% as much as the output of industrial methods before the wastage — i.e. more food than is needed in wealthier countries.
The ‘Inside Science’ report asserted that if organic research was funded as generously as current commercial farming methods, organic farmers could produce as much or more than industrial farmers.
What’s more, organic farmers are nourishing soil and not polluting rivers and oceans [The size and number of marine dead zones–areas where the deep water is so low in dissolved oxygen that sea creatures can’t survive–have grown explosively in the past half-century. — NASA Earth Observatory (2008)]
Four fifths of the world’s food is produced by these methods — which are sustainable.
Joe Burlington – is that right that four fifths of the world’s food is produced by sustainable organic farming methods? Nice to hear something that provides optimism from time to time!
Steve H – “There are more than 570 million farms in the world. Although the notion of family farming is imprecise, most definitions refer to the type of management or ownership and the labour supply on the farm. More than 90 percent of farms are run by an individual or a family and rely primarily on family labour. According to these criteria, family farms are by far the most prevalent form of agriculture in the world. Estimates suggest that they occupy around 70 — 80 percent of farm land and produce more than 80 percent of the world’s food in value terms.”
[On page 2 of ‘The State of Food and Agriculture 2014’. UN FAO http://www.fao.org/3/a-i4036e.pdf%5D
Four fifths is 80%. I now know that a figure of 70% is often used. There is detailed discussion at https://www.researchgate.net/post/Smallholder_farmers_produce_70_per_cent_of_the_worlds_food_Whats_the_source_for_this_number
Awesome. Thanks for the reply Joe.