26 October 2020
At its annual general meeting last Friday, Worley was a pains to stress the company’s support for a low-carbon energy transition.
This is consistent with recent developments at the company, which has historically provided integral engineering services to facilitate the expansion of the oil and gas sector.
In 2019, Worley acquired Jacobs Engineering Group’s Energy, Chemicals and Resources division, with the increased focus on chemicals diluting Worley’s proportion of revenue tied to oil and gas development projects from 65% to 20%.
However, Worley is still a significant player in the oil and gas industry. In the last 12 months, the company has announced agreements to provide services for major oil and gas projects, including:
- Corpus Christi LNG (estimated to enable emissions equivalent to 1.5 times Australia’s national emissions over its lifetime)
- Total’s new North Platte offshore oil field in the Gulf of Mexico
- Chevron’s huge Australian LNG operations
So while Worley’s newly stated purpose of “delivering a more sustainable world” and new CEO Chris Ashton’s apparent focus on sustainability are welcome, clearly more needs to be done to ensure the projects Worley chooses to work on are aligned with that focus.
At last year’s AGM, former Chair Andrew Wood said that, while projects are broadly assessed by reference to the UN’s Sustainable Development Goals, consistency with the Paris Agreement was not necessarily a prerequisite for working on a project.
Worley was asked if its Responsible Business Assessment Standard been updated since then to ensure any carbon intensive project is assessed and confirmed as aligned with the Paris Agreement’s goal of limiting warming to 1.5°C before the company decides to work on that project.
Mr Ashton said the Responsible Business Assessment had been updated, but stopped short of confirming this assessment would preclude Worley from working on projects that are inconsistent with a 1.5°C outcome.
Mr Ashton repeatedly spoke of the low carbon energy transition, noting that some oil and gas demand will be required through that transition.
However Worley has so far failed to recognise that an energy transition consistent with the Paris climate goals does not allow for increasing oil and gas use. In fact the IPCC demonstrates that, without relying on assumptions that carbon capture and storage technology will play a significant future role, the role of gas for primary energy must decline globally (from a 2010 baseline) by 25% by 2030 and 74% by 2050, with oil’s share of primary energy falling 37% and 87% over the same time frames.
In August, 25 leading Australian scientists confirmed that, if we are to meet the Paris climate goals, “the time has passed for any new fossil fuel infrastructure, including the proposed expansion of the gas industry in Australia”.
If Worley wants to deliver on its promise of “delivering a more sustainable world”, it must categorically rule out any work on projects that expand the scale of the fossil fuel sector.