The oil and gas firm ran by the president of COP28 climate talks is set to spend more than $1 billion every month this decade on fossil fuels, despite its claims to be a leading green energy provider, Global Witness analysis has found.
The Abu Dhabi National Oil Company (ADNOC) announced in January this year that it was earmarking $15 billion for investment in “low-carbon solutions” by 2030. A week later its CEO Sultan al-Jaber was unveiled as COP28 president, a move that caused dismay among climate organisations and US and EU lawmakers.
Global Witness has found that Al-Jaber’s company is planning to spend more than $100 billion between now and 2030 on oil and gas production alone – that’s an average of $1.14 billion every month, and nearly seven times more than its planned “low-carbon solutions” spend over the same period.
In 2030 – the year by which the United Nations says planet heating carbon emissions must be slashed by 45 percent – ADNOC is forecast to spend $13.2 billion on oil and gas alone, a 43-percent increase compared with current levels.
Both the UN and the International Energy Agency say that no new additional oil and gas production is compatible with the Paris Agreement temperature goal of limiting heating to 1.5C. Our analysis shows ADNOC is planning to spend at least $150 billion on new oil and gas production.
Al-Jaber, who also heads ADNOC’s renewables subsidiary Masdar, has said that keeping 1.5C within reach will be at the “top priority” of COP28 discussions in Dubai in November.
Having brought forward plans to increase its production capacity to 5 million barrels per day, ADNOC is more than doubling its capex on oil and gas projects by 2025. Capex and operating costs combined are set to increase 6 percent in 2024, 42 percent in 2025 and a further 16 percent in 2026, according to our analysis of Rystad Energy industry data.
In two years alone – 2026 ($16.1 billion) and 2027 ($16 billion) – ADNOC’s spending on oil and gas will outstrip its “low-carbon” investment for the entire decade.
ADNOC recently announced it would seek to become net zero by 2045 (6). Our analysis shows that it plans to spend $13.9 billion on producing oil and gas in that year alone. Between today and 2050, by which the UN says the entire global economy must achieve net zero emissions, ADNOC is projected to have invested $387 billion in oil and gas.
Patrick Galey, Senior Investigator at Global Witness, said:
“Fossil fuels companies like to burnish their green credentials, yet they rarely say the quiet part out loud: that they continue to throw eyewatering amounts at the same old polluting oil and gas that is accelerating the climate crisis.
“The International Energy Association and the UN says that no new oil and gas projects are compatible with 1.5C, yet Al-Jaber’s own company ADNOC plans to invest hundreds of billions in order to produce highly polluting fossil fuels for decades to come. During the two weeks of COP alone, it will spend nearly half a billion dollars on oil and gas.
“How he can expect to lecture other nations on the need to decarbonise and be taken seriously is anyone’s guess, while he continues to provide vastly more funding to oil and gas than to renewable alternatives. He is a fossil fuel boss, plain and simple, saying one thing while his company does the other.”
In response to questions from Global Witness, an ADNOC spokesperson said:
“The analysis of, and assumptions made, regarding ADNOC’s capital expenditure program beyond the company’s current five-year business plan (2023 to 2027) are speculative and therefore incorrect.
“The world’s population is expanding, and with-it energy demand is increasing. All of the current energy transition scenarios, including by the IEA, show that some level of oil and gas will be needed into the future. As such, it is important that, in addition to accelerating investments in renewables and lower carbon energy solutions, we consider the least carbon intensive sources of oil and gas and further reduce their intensity to enable a fair, equitable, orderly, and responsible energy transition. This is the approach ADNOC is taking.
“Our 2022 upstream emissions data confirms our position as one of the least carbon intensive producers in the world, and we are the first company among our peer group to accelerate our net zero ambition to 2045. We are further reducing our carbon intensity by 25% and targeting near zero methane emissions by 2030. As we reduce our emissions, we are also ramping up investments in renewables and zero carbon energies like hydrogen for our customers.”
Notes to editor:
Key findings
- ADNOC will spend more than $1 billion per month on fossil fuels in the period until 2030 [1] That’s $100 billion between September 2023 and 2030 inclusive – compared with $15bn pledged to low-carbon projects by 2030. That means ADNOC is projected to spend over six (6.6) times on fossil fuels than “low-carbon solutions” [2]
- During COP28, ADNOC will spend half a billion dollars on fossil fuels [3]
- By 2050 its total spending on upstream oil and gas will near $400 billion [4]
- It will spend more than $150 billion on new oil and gas by 2050 – none of which is compatible with 1.5C, per UN, IEA – per analysis of Rystad data
- ADNOC is more than doubling its Capex within just 2 years [5], the same date by which it plans to have increased capacity by 25 percent (5 million barrels per day vs 4 million bpd currently) [6]
- Trend-wise, it is predicted to ramp up its Capex and Opex in each of the next three years (+6% in 2024, +42% in 2025 and +16% in 2026) before a gradual relative decline from 2027 onwards. This is consistent with our previous production analysis, which showed a sustained increase in oil and gas output until 2030, and a relative steep decline thereafter
- This is happening in the most crucial decade for climate action – the UN Environment Programme’s Emissions Gap report says emissions must fall by 43 percent by 2030 in order to keep 1.5C within reach [7]
- In 2045 alone, the year which it is supposed to reach net zero emissions [8], ADNOC plans to spend $13.9 billion on upstream oil and gas
- In every single year through 2050 it is spending more on oil than on gas
- ADNOC is projected to spend 43 percent more on upstream oil and gas in 2030 than it does currently [9]
- ADNOC will spend more in two single years (2026 and 2027) on upstream oil and gas than it plans to invest in low carbon alternatives this entire decade [10]
Methodology
- The data on forecasted oil and gas capex, exploratory capex and opex was sourced from energy business intelligence agency Rystad Energy’s UCube database. UCube is an integrated field-by-field database of the global upstream oil and gas market, covering the time span from 1900 to 2100. Rystad’s data is widely referenced by major oil and gas companies, the media and international bodies such as the IEA.
- UCube takes into account oil and gas demand to project asset-level supply. Projections are based on data sources including company reporting (e.g., earnings and profits reporting) and policies, government sources and policies, energy service reporting, energy agencies and academic research and news articles. Where reported data is unavailable, data is modelled based on the above sources and supported by a comprehensive database of global oil and gas fields.
- We sourced the data of forecasted capex, exploratory capex and opex for the period 2023-2050. The data includes assets that are already producing (all assets that are currently producing), under development (assets for which development has been approved by companies and government but production has not yet started) or discovery (assets where discoveries have been made, but are not yet in a phase of further development). We did not include Rystad’s undiscovered life cycle category, which covers assets where discoveries have not yet been made.
- The data covers only investment in crude oil and gas production, not NGL and condensate, making these conservative production estimates
References
[1] $100 billion spend Sept 2023-2030 inclusive = $1.14 bn per month (88 months), per Rystad
[3] COP is 13 days (at least). $1.14 bn per month = $38 mn per day. $38 x 13 = $494 mn
[4] $387 bn Capex + Opex total by 2050 (inclusive of 2023)
[5] $3.62 bn in 2023 vs $7.48 bn in 2025
[6] https://www.adnoc.ae/en/ourstrategy/responsible-growth
[7] https://www.unep.org/resources/emissions-gap-report-2022
[8] https://www.adnoc.ae/en/OurStrategy/Advancing-Towards-Net-Zero
[9] 2023 Capex + Opex = $9.1 bn vs 2030 Capex + Opex = $12.9 bn
[10] 2026 Capex + Opex = $15.45 bn, 2027 = $15.56 bn, renewables by 2030 = $15 bn
