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PETRONAS’ Net Zero Carbon Emissions Pathway – Our Journey
Facing an era of rapid energy transition, PETRONAS announced its Net Zero Carbon Emissions pathway, designed to accelerate its efforts and set out details of how the organisation will take even more credible actions to fulfill its commitment in achieving net zero carbon emissions by 2050. The pathway will address emissions from our operations and include growth targets for cleaner energy solutions. Delivery of this target is anchored on our business context, national policies, international frameworks and scientific consensus on climate change that supports the Paris Agreement.
“For PETRONAS, we intend to seize the opportunities and provide the world with the energy it needs today with consideration for the climate goals of the Paris Agreement. PETRONAS’ priority is to be in step with the progress of the societies we serve.”
YM Tan Sri Tengku Muhammad Taufik
President & Group CEO, PETRONAS
Our Targets
Reducing our Operational Greenhouse Gas Emissions
Zero Routine Flaring and Venting
Implementing flare gas recovery projects, improvements in compressor capacity, vent-to-flare conversion and vent recovery projects. To this aim, we have endorsed the World Bank's Zero Routine Flaring by 2030 Initiative. PETRONAS has pledged to avoid routine flaring in new oil field developments and end routine flaring at existing oil production sites by 2030.
Electrification
Investing in and developing renewable energy infrastructure to power PETRONAS' operations and processes, which include, among other things, fuel gas replacement with electricity where feasible.
Energy Efficiency
Building on existing operational excellence with technology and innovation, such as implementation of digital solutions and process equipment advancement, to uplift process optimisation initiatives such as optimising gas turbine operations, superior heat transfer, furnace, and boilers efficiency, etc.
Carbon Capture and Storage (CCS)
Develop carbon capture and storage solutions in partnership with technology providers, focusing on efforts to capture carbon dioxide and injecting it into deep geological formations for permanent secure storage. With the applied technologies and innovation, the joint partnerships will drive PETRONAS' efforts
towards net zero carbon emissions by 2050 aspiration.Approach to Climate-related Risks and Opportunities
Climate science plays a significant role in driving the transition to renewable energy sources and low-carbon technologies. As awareness of the need to mitigate climate change grows, there is increasing demand for cleaner, sustainable energy. This shift creates both risks and opportunities for PETRONAS.
PETRONAS is dedicated to its role as custodian of Malaysia’s hydrocarbon resources and to meet customer energy demands, while contributing towards the climate ambitions of the Paris Agreement. Our Pathway to Net Zero Carbon Emissions 2050 (Pathway) was launched in November 2022, outlining the actions needed to achieve our net-zero ambitions. The development of the Pathway was informed by our business context, national policies, international frameworks, and scientific consensus on climate change.Adopting TCFD
We aspire to proactively strengthen transparency in reporting while shaping the national climate-related risk disclosure practice in Malaysia. We apply the framework recommendations put forward by the Task Force on Climate-related Financial Disclosures (TCFD) to our assessment of climate risk. By aligning our strategic assessment of risk with TCFD, we strive to effectively manage and capitalise on climate-related risks and opportunities and accelerate progress towards our path to net zero.
Governance
We recognise that climate change is a critical business issue, contributing to a set of risks and opportunities. We are taking more deliberate actions to elevate sustainability, especially climate-related discussions at the Board, to shape the long-term strategic direction of the company. The role of the Board in climate-related matters can be referred to in the Sustainability Statement section.
Strategy
We defined our Pathway to accelerate and advance groupwide actions and commitment. The Pathway – with its short-, medium- and long-term targets – will steer the group towards realising our Pathway to Net Zero Carbon Emissions 2050 (NZCE 2050). The Pathway is two-pronged, reducing operational greenhouse gas (GHG) emissions and increasing investments in business growth opportunities in the low carbon economy.
Risks & Opportunities
We apply a group-wide approach to the management of risk through the establishment of the PETRONAS Risk Policy and complemented by the PETRONAS Resiliency Model, which the Enterprise Risk Management (ERM) Framework is part of. These policies and frameworks provide an integrated and holistic view of the overall strategy towards effective risk management. We have adopted TCFD’s categorisation of climate-related risks into two major categories which are transition risks and physical risks.
Metrics and Targets
PETRONAS has adopted the equity share approach to account for our emissions inventory and performance. We have revised our carbon emissions accounting method to adhere to international frameworks and sector specific guidance to give us a robust basis for Scope 1 and Scope 2, and a better understanding of Scope 3 greenhouse gas emissions.
Read more for details description on our adoption of TCFD in www.petronas.com/integrated-report-2022/
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