A division of Occidental Petroleum, Oxy Low Carbon Ventures (OLCV), has delivered the world’s first shipment of carbon-neutral oil to India.
Occidental said on Thursday that the delivery of two million barrels of carbon-neutral oil was made to Reliance Industries.
This transaction is the energy industry’s first major petroleum shipment for which greenhouse gas (GHG) emissions associated with the entire crude lifecycle have been offset.
Occidental added that this transaction was the first step in the creation of a new market for climate-differentiated crude oil. It is also a bridge to the development of a further differentiated petroleum product, net-zero oil – which the company intends to produce through the capture and sequestration of atmospheric CO2 via industrial-scale direct air capture facilities and geological sequestration.
Macquarie arranged and structured the bundled offset supply and retirement. The offsets were sourced from a variety of projects verified under the Verra Verified Carbon Standard meeting eligibility criteria for the UN’s International Civil Aviation Organization’s Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA).
The volume of offsets applied against the cargo are sufficient to cover the expected GHG emissions from the entire crude lifecycle including oil extraction, transport, storage, shipping, refining, subsequent use, and combustion.
This type of transaction, which involves the bundling of high-quality carbon offsets with crude oil, is an immediate executable solution that helps promote investments in longer-term, industrial-scale decarbonization strategies. It is also a step in the furtherance of Occidental’s net-zero ambitions and commitment to addressing climate change today.
Occidental is the first U.S.-based international energy company to announce an ambition to achieve net-zero GHG emissions associated with the use of its products by 2050
Recently, Occidental Petroleum claimed that it was doing more than U.S. electric vehicle and clean energy company Tesla to reduce greenhouse gas emissions.
Richard Jackson , president of Oxy Low Carbon Ventures, said: “ We are taking important initial steps to work with our customers in hard-to-decarbonize industries to offer carbon-neutral and other low-carbon products that will leverage our expertise in carbon management to lower their total carbon impact and address Scope 3 emissions ”.
Ozzie Pagan , senior managing director for Macquarie in the Americas, added: “ Macquarie is delighted to have worked with Occidental in developing this innovative solution. We look forward to continued collaboration with the company on realizing their ambitious carbon-neutral goals.
“ Macquarie is working to lead the energy transition through innovation and investments focused on advancing de-carbonization. We seek to develop, along with our clients, actionable strategies today and sustainable innovations for the future ”.
It is worth noting that the very large crude carrier (VLCC) Sea Pearl containing the carbon-neutral oil finished unloading in India on Thursday, 28 January.