1st July, 2022
By Onome Lisa Ejenavi PhD
The contemporary oil and gas industry is confronted with irrefutable global challenges and is at a critical juncture.
These challenges cut across environmental, economic, political, or technological demands to tailor exploration and production activities in accordance with wide-ranging issues tied to the sustainable development paradigm.
In essence, the modern-day petroleum industry must consider all interlocking and mutually reinforcing pillars of sustainable development articulated as: environmental protection, economic growth and social development.
Although the concept of sustainable development has since evolved and expanded into the 17 sustainable development goals (SDGs), its core premise and principles remain consistent. Each goal and target of the SDGs remains inextricably linked to fulfilling one or more aspects of the 3 pillars.
In actualizing the aims of sustainable development, the oil and gas industry has to underscore and fulfil the core demands which include environmental protection, (expressed via GHG and CO2 mitigations, including biodiversity preservation), energy security, typified by reliability of products supplies or
their affordability and economic growth.
Post the Paris Agreement in 2015, which reiterates the imperative of the transition into a low carbon economy, the industry is placed in the peculiar position of bracing up to current signals regarding divestments of funds from the sector.
Due to these daunting challenges, creating a nexus between oil exploitation and sustainable development becomes imperative for developing petro-states as they are more reliant on hydrocarbon resources for driving their development agendas.
Certainly, the petroleum industry contributes to sustainable development in multiple ways by creating synergies across goals like poverty eradication via direct and indirect employment generation, energy security, economic growth through the state’s generation of substantial tax incomes and other revenues, including prompting technological advancement and innovation from more advanced economies.
However, the petroleum industry’s massive potential to impact on broad ranging factors positively or adversely as articulated by the sustainable development goals (SDGs), traversing economic growth, ecosystems management & protection including social development makes it a topical aspect of the sustainable development discourse. The obvious challenge being, how to generate more synergies across the SDGs rather than trade-offs.
Similarly, the pursuit of the goals or SDGs such as goal 14, affecting sustainable use of oceans, or goal 15 on terrestrial ecosystems, halting of deforestation and ensuring sustainable consumption directly and positively impacts goal 13, on forestalling climate change and its dire implications.
Nevertheless, the causal links between energy generation via fossil fuels use and climate change makes it a nagging issue requiring the need for targeting its amelioration via the targets and indicators of SDG 13, which stipulates the integration of climate change measures into national policies, strategies and planning.
It is also clarified that the burning of fossil fuels can produce around 21.3 billion tons of carbon dioxide (CO2) per year.
Carbon dioxide is a greenhouse gas that increases radiative forcing and contributes to global warming.
More so, the ability of climate change or its effects to severely heighten inequality or aggravate inequities against the poor or disadvantaged cannot be cursorily dismissed as this directly impacts upon the attainment of the SDGs.
The world’s poor and vulnerable are most susceptible to climate change and have minimal resistance or adaptive capacity to cushion the shocks and harsh effects.
Some of these harsh effects range from the exacerbation of hunger, poverty, or inequalities between people and across countries to the impairment of health and wellbeing goals.
Thus, the need to effectively incorporate climate action plans into petroleum development or projects planning as part of national policies will serve to anticipate or put in place adaptive or mitigative measures to counter its debilitating effects whilst impacting positively on several goals.
Similarly, a failure of integration or effective management efforts to tackle goals 14-15, affecting the sustainable use of natural resources, aquatic or terrestrial ecosystems and biodiversity during petroleum exploitation not only poses threats to food security but can severely impact SDG16 relating to peaceful societies and regional stability.
This is quite evident from examples of oil-induced conflict in Nigeria’s Niger-Delta, Angola’s Cabinda region, or East and South Yemen.
Also countering the challenges regarding the SDGs actualization anchor heavily on local, national and international collaboration, including broad-based expert and NGO participation.
More so, this interaction between state, industry and community objectives with the SDGs allows for not just short, but medium to long-term collaboration to foster economic and social sustainability, including a green oil industry.
The SDGs tactically modify the erstwhile states-focused approach to sustainability, to act as a value-triggering means of operationalizing sustainable development of the petroleum sector, via a more expansive network of actors, including a wide-range of local and international participants who can contribute to relevant spheres of oil sector growth to trigger a multi-stakeholder involvement which leaves no one behind.
Notwithstanding the considerable benefits or synergies derivable across the SDGs during oil exploitation, the issue of trade-offs in the sustainability discourse or in the oil industry remains inevitable.
Trade-offs therefore come into play in the sustainability discourse when a juxtaposition of positives or negatives is required in a selection amongst competing options and outcomes.
Invariably, positive gains with respect to some goals will be preferred at the expense of other SDGs preceding the implementation of a development decision.
Undoubtedly, the oil industry has been the precursor of negative externalities and trade-offs.
Evidently, the trade-offs and sustainability dilemmas from oil industry operations, range from adverse environmental footprint, carbon trails or contrary climate impacts and social challenges.
Although these problems have triggered calls for decarbonization, the need to maintain global energy security, access to affordable, reliable, sustainable and modern energy for all, as advocated by SDG 7, intensifies the necessity of more impactful solutions in the industry to forestall global or regional energy crises and unsustainable development.
A case of multiple trade-offs is even more glaring where petrol-rich developing states are concerned.
This is because petro-states grapple with the prospect of extensive climate change adaptation and mitigations challenges or costs in tandem with urgent development needs.
This creates a dilemma as to what priority actions to execute with limited funds; continued petroleum exploitation for: poverty eradication, energy security which in turn impacts food security, health, sustainable cities, economic growth or moderate and progressive steps towards climate change mitigations?
This tricky issue is subsequently considered, as it weighs heavily on petroleum reliant developing states in their quest for sustainable development.