Oil companies promote gas as cleaner than coal for power generation

(Bloomberg; June 2) -Oil companies that have pumped trillions of barrels of crude from the ground are now saying the future is in their other main product: natural gas, a fuel they’re promoting as the logical successor to coal. With almost 200 nations set to hammer out a binding pact on carbon emissions in December, fossil-fuel companies led by Shell and Total say they are refocusing on gas as a cleaner alternative to the cheap coal that now dominates electricity generation worldwide.

That has sparked a war of words between the two industries and raised concern that Big Oil is more interested in grabbing market share then fighting global warming. “Total is gas, and gas is good,” CEO Patrick Pouyanne said June 1, in advance of this week’s World Gas Conference in Paris. His remarks echoed comments two weeks earlier by Shell CEO Ben Van Beurden, who said his company has changed from “an oil-and-gas company to a gas-and-oil company.”

Shell began producing more gas than oil in 2013; Total did it in 2014. ExxonMobil’s gas output rose to about 47 percent of total production last year from 39 percent six years ago. Shell, Total, BP and other oil companies said in a joint statement June 1 that they are banding together to promote gas as more climate friendly than coal. “The enemy is coal,” Pouyanne said. A key strategy for gas producers to push this agenda is asking governments to levy a price on carbon emissions from power plants. That creates an economic incentive to switch from coal to cleaner options.