Dr Marcio Wagner da Silva, Process Engineering Manager.

How are oil & gas companies rethinking their operational strategies to prioritise carbon emissions reduction?

It's fundamental to understand that there is not a magic solution to promote real decarbonisation in the oil & gas industry, the advances are incremental, and, in this sense, we are seeing good advances. The efforts to maximise energy efficiency of the process, especially in the downstream sector, are a relevant part of the strategic planning of any downstream player and this has a deep impact on carbon emissions. Another good advance is the development of carbon capture technologies and green hydrogen production routes.

The oil & gas companies are engaged to reduce their carbon emissions, and this is reflected in their strategic planning, but it's important to consider which is fundamental to look for a balance between carbon intensity reduction and the energetic security of the nations.

What role do emerging technologies, such as carbon capture and storage (CCS) or hydrogen, play in reducing emissions in the oil & gas sector?

The new technologies have a fundamental role in the search for a sustainable decarbonisation of the oil & gas industry. Real decarbonisation should balance the economic development of the nations and the environmental emissions which is translated by the term ‘energetic security’. Under this context, the development of new technologies, especially the carbon capture and clean routes to produce hydrogen are essential to achieve this balance.

For example, nowadays, it's impossible to produce cleaner crude oil derivatives without a great amount of hydrogen which is produced in large scale through natural gas reforming, which releases a great amount of carbon.

Considering that these technologies are under development and with relatively high cost, it's fundamental to a synergy between the oil & gas players and governments aiming to develop policies capable of supporting the development of these technologies with low impact to the energy prices for final consumers.

How are companies integrating renewable energy sources (e.g., wind, solar) into their operations to reduce reliance on traditional hydrocarbons?

The renewables coprocessing routes in crude oil refineries are an interesting route to achieve decarbonisation, but there is a limit considering the quality of final derivatives and process restrictions like hydrogen consumption in hydrotreating units and the necessity to develop specific catalysts to deal with high amount of renewable raw material in the feed of processing units. As quoted earlier, hydrogen is still produced by an intensive carbon emissions route and increasing the renewables participation in the feed of hydrotreating units will not close the circularity cycle.

Another key question is ensuring an adequate and secure supply chain of raw materials. There are limitations to producing biomass for any countries and some regions like the Middle East can face even more difficulties to have access to biomass, furthermore there is always the concern relative to a potential concurrence with food which is not tolerable.

What are the challenges and opportunities for oil & gas companies in transitioning to cleaner energy sources like biofuels or green hydrogen?

The challenges are related to produce deep changes in their process, accelerate the development of relatively new technologies and keep their competitiveness under the threat of potential high operating costs related to the use of new technologies, furthermore, the main challenge for oil & gas players is the culture change where it's necessary to understand that the world changed and the strategies applied in the past success will not works to the future challenges.

The opportunities are related to the development of technical critical thinking even to use their knowledge to create new alternatives. The oil & gas industry is a centenary industry which has a kind of aversion to innovations and this needs to change to achieve sustainable development, especially considering the increasingly hostile scenario for fossil fuels. The oil & gas industry personnel should behave more like the technological companies now, where the concept of innovation is in the core business.

How important are partnerships between oil & gas companies and clean tech startups or government initiatives in driving emissions reduction?

This synergy is fundamental! As previously quoted, there are no clear policies about carbon markets in countries and incentive policies to install carbon capture technologies by the oil & gas players, it's a fundamental part of the strategy to promote real decarbonisation without great impact over the energy cost for final consumers.

Closer relations with clean tech start-ups are beneficial for oil & gas players once these companies have more agility and experience in developing and launching new technologies. As a secular industry, oil & gas companies tend to have extremely rigid management processes which can delay the development of innovations, and the start-ups partnership can be a strategy to solve this matter.

What specific processes or operational changes are being implemented to improve energy efficiency and reduce emissions at extraction, refining, and transportation stages?

As previously commented, there is a serious concern in the oil & gas companies to reduce the carbon intensity of their processes through energetic efficiency. In the refining industry, for example, energy is responsible for higher than 60% of the total production cost, and obviously, this question can't be ignored by any player which wants to reach competitive operations.

In countries with relatively clean, energetic matrix (high availability of hydroelectric plants), the direct use of electric power in the process in detriment of power generation from steam can be a good strategy to minimise carbon emissions, but there is a reliability cost which needs to be adequately managed.

The main question is using the available technologies to promote deep studies of the process and identify opportunities to reduce energetic intensity of the process. A question which demands even more study is hydrogen waste in crude oil refineries where the use of ‘pinch technologies’ can help the refineries to minimise the carbon emissions related to hydrogen production.

(The views expressed in interviews are personal, not necessarily of the organisations represented)

Dr Marcio Wagner da Silva is Process Engineering Manager at a Crude Oil Refinery based in São José dos Campos, Brazil. He earned a bachelor's in chemical engineering from the University of Maringa (UEM), Brazil and a PhD in Chemical Engineering from the University of Campinas (UNICAMP), Brazil. He has extensive experience in research, design and construction in the oil and gas industry, including developing and coordinating projects for operational improvements and debottlenecking to bottom barrel units. Dr Marcio Wagner earned an MBA in Project Management from the Federal University of Rio de Janeiro (UFRJ), and in Digital Transformation at Pontifical Catholic University of Rio Grande do Sul (PUC/RS), in Production and Operations Management at State University of Sao Paulo (USP), and is certified in Business from Getulio Vargas Foundation (FGV).