«Problems of economics and management of oil and gas complex»

Energy transformation and adaptive capabilities of oil and gas companies

UDC: 338.12
DOI: -

Authors:

¹ National University of Oil and Gas "Gubkin University", Moscow, Russia

Keywords: oil and gas companies, energy transition, development strategies, adaptation, ratings, ESG

Annotation:

Oil and gas companies face a critical choice of their role in the global energy system amid the climate crisis. The key question is how to position themselves and how best to become part of the renewable energy "revolution". Going beyond their core business is risky, but a "wait and see" strategy can be costly, so they need to gradually expand their business model. Companies are adopting strategies to remain relevant in a decarbonized world. Some of them have already expanded their portfolios including new energy. Other ones are decarbonizing their core businesses. Still others are abandoning part of their investments in the oil and gas industry. As these strategies evolve, three new company archetypes will emerge: energy companies, oil and gas companies, and low-carbon solutions leaders. Methods for adapting companies to the new situation are described. To assess the adaptation of major companies to the energy transition, the "Index of Corporate Flexibility and Resilience" indicator is used. The values of this index for major and national oil companies are given. It is concluded that a pragmatic new alignment of forces, prioritizing energy security goals over the sustainability imperative, will slow the pace of transition over the next few years.

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