This newsletter provides monthly updates on oil and gas expansion globally, reporting on every new oil and gas exploration licence awarded. It also tracks the climate impact of these licences, translating them into total embodied emissions—that is, the amount of carbon dioxide (CO2) released into the atmosphere if the licensed oil and gas is extracted and burned. Finally, the monitoring of companies’ spending to explore and develop new oil and gas fields provides additional insights into the industry’s expansion activities. Certain data is segmented according to countries’ capacity to transition away from oil and gas.

Halting new fossil fuel projects is a key step in limiting global warming to 1.5°C and transitioning away from fossil fuels, as agreed by 198 countries at COP 28. Research by Green et al. (2024) in Science shows there is more than enough oil and gas in existing fields to meet Paris-aligned energy demand. Accordingly, the Carbon Minefields newsletter monitors efforts to expand oil and gas production beyond already operating fields—flagging misalignment with the Paris Agreement target.

The data below is collected by experts at the International Institute for Sustainable Development (IISD); we use AI and programming tools to extract and analyze data from Rystad Energy (2024) before reviewing all content for accuracy and clarity.

Monthly Update

New Exploration Licences Awarded

Last month, a total of 11 oil and gas exploration licences were awarded in five different countries. Among these, Morocco awarded licences with the largest volume of embodied emissions. The estimated volume of gas embodied in the licences awarded by Morocco is 315.6 billion cubic feet. If these reserves were burned, it would result in 18.8 million tons of carbon dioxide emissions. Overall, the total emissions that would be produced from burning all the newly licenced reserves is estimated to be 25.2 million tons of CO2. This data highlights the significant environmental impact associated with fossil fuel exploration and underscores the importance of transitioning toward cleaner and sustainable energy sources.

Oil and Gas Companies' Exploration Activities

During the last month, the companies with the highest investments in oil and gas exploration were Saudi Aramco, ExxonMobil, and Kuwait Petroleum Corp (KPC), totalling USD 1,230.1 million. The exploration licences with the highest embodied emissions were acquired by ExxonMobil, Comet Ridge, and Touchstone Exploration Inc., predominantly from Morocco, Australia, and Trinidad and Tobago. The global exploration CAPEX for projects awarded or discovered in the recent month amounted to USD 1,839.2 million, indicating a significant commitment to expand oil and gas production despite climate commitments and the COP 28 agreement to transition away from fossil fuels.

Rolling Annual Update

Licences Awarded

Over the last 12 months, awarded oil and gas exploration licences embodied a total of 1,774.9 MtCO2. The month with the highest volume of embodied emissions was May 2024, accounting for 621.5 MtCO2. Among the countries awarding these licences, those with low capacity to transition away from oil and gas production and low dependence on these fuels have contributed the most to the total emissions. Among these nations, Mozambique stands out for awarding licences with the largest volume of embodied emissions.

Note: The embodied carbon emissions from newly awarded licences are presented based on four country groups based on the Civil Society Equity Review (2023) categorization. Countries are grouped based on two main axes: 1) their capacity to transition and 2) their dependence on fossil fuels, which provides a rationale to determine how fast they should phase out their domestic production.  These indicators are measured based on countries' ability to deal with the costs and disruptions of climate change and historical emissions, as well as an assessment of how much a country’s socio-economic welfare is dependent on extraction.

Exploration CAPEX

In the past year, the total capital investment in oil and gas exploration projects has reached USD 25.9 billion, with January 2024 projects receiving the most significant funding. On average, monthly CAPEX stands at USD 2.2 billion. BP, Saudi Aramco, and Equinor are the top investors, collectively committing USD 5.1 billion to exploration projects awarded or discovered in the last 12 months.

Outlook

Ongoing and Upcoming Licensing Rounds

As of last month, there were 22 blocks open for bidding or under evaluation for oil and gas exploration. Looking ahead, there are plans to make 304 blocks available in upcoming licensing rounds. The estimated global emissions from burning the fuel reserves in these upcoming rounds is 5,654.6 MtCO2. China leads in the number of blocks planned to be available, with potential emissions of 905.0 MtCO2 if the oil and gas reserves are burned. These figures highlight the significant scale and impact of the oil and gas exploration activities under consideration.

Global Exploration Trends

Exploration activities in 2024 are expected to continue their upward trend since the global decline experienced in 2020. In the first 7 months of 2024, an estimated total of 304,000 square kilometres—equivalent to the land area of Poland—was awarded to oil and gas companies, who drilled 588 wells to explore new reserves with an estimated 2.03 GtCO2 of potential emissions. This is less than the acreage awarded in the same period of 2023, but upcoming licensing rounds indicate the total for the year is likely to be higher.

About the Carbon Minefields Newsletter

This newsletter is produced using data from Rystad Energy (2024) extracted from the UCubeExploration Browser v. 2024-08-06 and published with Rystad’s permission. Embodied emission estimates were calculated by the authors using the Intergovernmental Panel on Climate Change emission factors of crude oil, condensate, natural gas liquids, and gas. Rystad’s forecasts can change as licensing rounds are deferred, cancelled or completed, and estimates of reserves are revised. Data manipulation is automated with Python programming. Most text is generated with OpenAI's application programming interface using GPT-3.5 Turbo. The AI-generated outputs for this edition were produced on August 12, 2024. International Institute for Sustainable Development experts review all AI-generated content for accuracy, clarity, and further interpretation.

For more information regarding the data presented and for national-level disaggregation, please contact us at oboisvonkursk@iisd.ca or ceposadap@iisd.ca.