A renewed focus on hydrocarbons by major fossil fuel players is a “blip” that won’t derail their longer-term energy transition agenda – but represents a “very, very challenging message” for oil companies “that have lost control of the narrative”, said the CEO of global engineering giant Worley.
Chris Ashton claimed recent announcements by European oil & gas groups over higher relative investment levels in their core business compared to areas such as renewables shouldn’t be taken as a sign that the low-carbon shift is going into reverse.
“In the scheme of things, it’s a blip,” Ashton told Recharge in an interview, saying short-term decisions based on soaring fossil fuel prices would not change the longer-term trajectory towards lowering carbon.
“Speaking to a range of oil and gas companies, a range of big miners, a range of chemicals [companies], I’m not seeing any indication of them backing away from their transition, their strategic pivot,” said the Worley CEO, whose 50-000-strong global team works across the energy sector from upstream hydrocarbons to pioneering floating wind projects.
Oil majors including BP and Shell have been in the headlines in recent weeks over their commitment to the energy transition. Ashton said that while “we can’t transition without the oil and gas companies making a profit”, recent shifts in emphasis represent “a very, very challenging message for the oil companies to manage”.
Ashton added that the fossil majors “have lost control of the narrative” [around their transition plans] . “This doesn’t help them take back control.”
Airbus an example
The Worley CEO spoke after the Australia-headquartered group hosted a seminar in London on the direction of the energy transition, including the need to balance ensuring community buy-in to project development with the rapid progress required to hit net zero goals.
Ashton said new models of distributed manufacturing could help to endure that more regions felt they were gaining industrial benefits from the transition.
He cited the example of Airbus, the pan-European aerospace giant which operates in multiple countries with elements of the aircraft made in each.
“We have to see organisations invest in distributed manufacturing,” said Ashton.
“Airbus as a concept brought multiple countries together, multiple elements of the supply chain, common goals.
“I think there’s a similar opportunity to align supply chains with distributed manufacturing in its construct but bring them together differently.”