Pemex Makes a Massive Emissions Reduction Pledge

Mexico’s troubled state energy major Pemex has announced plans to slash its carbon dioxide emissions by 54% over the next six years—perhaps the most ambitious emission-cutting program in the oil industry ever.

The company also said it would increase the amount of money it spends on non-oil and gas energy technologies and improving its safety standards, Bloomberg reported, citing Pemex executives during a call with investors, at which the company presented its updated sustainability plan.

“We are committed to reducing our environmental footprint through efficient practices and sustainable operations,” the acting chief financial officer Carlos Cortez said on the call. “This is a roadmap to a more prosperous future.”

However, investors interested in a greener Pemex would likely need to see some proof that these intentions are serious before they commit any money, the report noted.

“Some investors might need to see concrete steps to achieve the goals stated in order to fully embrace the ESG theme,” an analyst with a New York bank told Bloomberg. “Nevertheless, this starts to open the window of opportunity for those investors with ESG restrictions,” William Snead from Bank Bilbao Vizaya Argentaria said.

Earlier this month, Pemex said it would reach net-zero status for its operations by 2050. In an earlier version of its sustainability plan, the company said it would reduce its methane emissions by 30% over the next seven years and stop all gas flaring.

This week, Pemex said it would use between 14% and 18% of its capex this year for ESG projects. Over the next six years, the amount of capex allocated for such projects will be maintained at between 10% and 14%, the company also said.

Pemex is the most indebted oil company globally, with a pile of some $106 billion and declining production that it needs to turn around.

By Irina Slav for Oilprice.com

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