Oil and gas industry expresses concern in a letter to Ed Davey about his comments on fossil fuel assets becoming unburnable to stop dangerous climate change.
The fossil fuel industry was deeply “unsettled” by comments from energy secretary Ed Davey raising the prospect that their assets could be rendered worthless by global action on climate change, according to a letter of protest sent to the secretary of state.
Malcolm Webb, chief executive of Oil and Gas UK, which represents the industry, wrote to Davey saying he was “perplexed” by the “conflicting and confusing messages” and accused him of making investment in the North Sea less attractive. The letter was released to the Guardian under freedom of information rules.
The issue was also raised by Erik Bonino, chairman of Shell UK, at a meeting with Davey in January, at which Bonino said if Shell “knew there were to be no more fossil fuels, [it] could cash out and give shareholders their money back in four years”.
The strong reactions reveal the depth of concern inside fossil fuel companies at analyses showing there are already three times more fossil fuels in proven reserves than can be burned if global warming is to be limited to 2C, the pledge made by the world’s nations. If a global climate deal makes good on that pledge, those coal, oil and gas reserves could become worthless, potentially losing investors trillions of dollars. Fossil fuel companies, which spent $650bn in 2013, searching for more reserves are also under attack from a fast-growing divestment campaign, which has persuaded over 180 groups to dump their fossil fuel stocks.
