Al Jaber's Dilemma for COP 28: Deliver finance and phase-out fossil fuels

The COP28 team has pushed back against this criticism and emphasised the importance of involving fossil-fuel companies in the energy transition. (Representative image)

“The phase-down of fossil fuels is inevitable”, was the last thing anyone expected Sultan Al Jaber, managing director and group CEO of Abu Dhabi National Oil Company (ADNOC), to admit in the presence of a small gathering of youth constituencies at the recently concluded 58th session of the UN Framework Convention on Climate Change, aka SB58, in Bonn, Germany.

Al Jaber is the minister of industry and advanced technology of the United Arab Emirates, and the President-designate of the United Nations climate change summit COP 28 scheduled to be held in Dubai in December 2023. This is his strongest statement yet on the future of coal, oil, and gas, in a warming world and is being interpreted by many as a climb down from his and his government’s previous positions, even if he did not suggest any time frame.

“Maximum energy with minimum emissions” has been Al Jaber’s mantra. “The world needs all the solutions it can get,” he said last October. “It is not oil and gas, or solar, not wind, or nuclear, or hydrogen. It is oil and gas and solar, and wind and nuclear, and hydrogen,” he said in his opening address at the 38th edition of the Abu Dhabi International Petroleum Exhibition Conference (ADIPEC). In November, ADNOC endorsed plans to expand the company’s five million barrels per day oil production capacity by 2027 from a previous target of 2030, to meet rising global energy demand. As recently as January of this year, at the Atlantic Council’s Global Energy Forum, he was still reciting his mantra, ‘Our world is on its way to being home to 9.7 billion people by 2050 and will have to produce 30 per cent more energy than what is available today. As long as the world still uses hydrocarbons, we must ensure they are the least carbon-intensive possible.”

Over the past year, the world’s biggest oil producers — places like the United States, Saudi Arabia, Norway and the Emirates — have approved dozens of vast new drilling projects. This month, the Emirates received long-sought permission from the Organisation of the Petroleum Exporting Countries (OPEC), the coalition of oil-producing nations that coordinates output and prices, to pump more oil starting next year. ADNOC, the oil company Al Jaber heads, is investing billions in meeting those new targets.

Change In Stance

This is why his “inevitable phase-out of fossil fuels” came as a surprise to many. However, by itself, the “phase-down of fossil fuels” statement without any timeframe is meaningless at a time when what is required is a quick and dramatic “phase-out of fossil fuels”. At the last COP, negotiators from India,  small island nations, Latin America, Africa and European Union called the conference to deliver an agreement on a “phaseout” of fossil fuels. But they received stiff resistance from representatives from fossil fuel-producing countries like Russia and Saudi Arabia.

Al Jaber has faced significant criticism for being designated as COP President due to his role as chief executive of an oil company. Last month, more than 130 European and US lawmakers published an open letter calling for his removal from the role, arguing that having the head of one of the world’s largest oil and gas companies as COP president risked undermining the negotiations. The COP28 team has pushed back against this criticism and emphasised the importance of involving fossil-fuel companies in the energy transition.

COP28 in Dubai, where Al Jaber is presiding, is the venue for the global stocktake to review the implementation of the Paris Agreement and its goal of keeping global warming well below 2°C and pursuing efforts to keep it under 1.5°C above pre-industrial levels. At the current levels of emissions, the world is way off the mark from the Paris Agreement goals, and, according to the United Nations Environment Programme is headed for 2.7°C warming. The challenge for his presidency is to ensure that the mitigation efforts are scaled up in a manner that complements the global stocktake.

Has the CEO of the world’s biggest oil company seen the end of the fossil fuel age or is the President-Designate of COP 28 climbing down in the face of relentless criticism?  One thing is certain, Al Jaber has a huge challenge ahead given the failure of parties to agree on the Mitigation Work Program, vital to achieving Paris Agreement goals, at Bonn. The only way to save COP28 is for him to find ways of delivering on climate finance, the lack of which is the biggest hurdle to global efforts on climate action. He can start by topping up the $100 billion climate promise that was to be delivered by 2020 and activate the Loss and Damage fund by providing the first tranche of funds from the profits of his fossil fuel businesses.

Shailendra Yashwant is a senior advisor to Climate Action Network South Asia (CANSA). Twitter: @shaibaba. Views are personal, and do not represent the stand of this publication.