What are the challenges?

Population growth and increased prosperity will continue to increase demand for energy. We believe that fossil fuels will remain the dominant source of energy for decades to come. At the same time, however, the world's greenhouse gas emissions must be reduced. The scale of the challenge means that all options must be used. Energy efficiency is one important tool. Other necessary tools for the transition to a low-carbon society include carbon capture and storage (CCS), fuel-switching - e.g. from coal to natural gas - and renewables.  

As remaining hydrocarbon resources are becoming harder to find, we are entering new energy-intensive and environmentally challenging areas of production. Heavy oil production from Venezuela, oil sands in Alberta and the production of LNG all lead to higher greenhouse gas (GHG) emissions per unit produced. We have entered into these activities with the aim of providing leadership in finding solutions to the challenges involved.

Renewable energy production will play an important role in the longer term. Renewable energy production is still a young industry that will need big investments and a great deal of technological development to become efficient and competitive. Renewable energy production is one of Statoil's main strategy areas.

Statoil calls for a global climate regime that provides the necessary long-term framework, encouraging cost-efficient renewable and low-carbon energy solutions.

What are we doing? 

Our goal is to develop a profitable business that leads to sustainable energy production and increased use of clean energy carriers. Our industrial response to the climate challenge is to focus on energy efficiency and carbon capture and storage, and gradually build up our new energy portfolio. 

Statoil is a pioneer in CCS and currently operates some of the world's largest projects in this area (Sleipner, Snøhvit, In-Salah). We are now taking one step further by building a technology centre for developing more cost effective technologies for carbon capture from different sources, such as coal and gas-fired power plants and refineries - in cooperation with the Norwegian Government and Shell. Statoil intends to generate significant business from carbon management, mainly focusing on storage. 

The development of renewable energy is important to us, and in this context our main focus will be on offshore wind and sustainable biofuels. Our ambition is to be an industry leader in terms of low climate impact from our activities. While producing energy, we stay committed to addressing climate issues. For us, this is both a challenge and an opportunity for technological innovation and value creation. Our ambition is to provide energy to meet the growing demand that is required for economic and social development, while at the same time caring for the environment and actively combating global climate change.

Statoil has developed the world's first full-scale floating wind turbine - Hywind - and, together with Statkraft, we will invest more than NOK 10 billion in Sheringham Shoal offshore wind farm capable of powering 220,000 British homes.

Biofuels are an important sustainable energy carrier that could contribute significantly to the reduction of greenhouse gas emissions in the transport sector.Our goal is to become a significant provider of sustainable biofuels and to achieve a first-mover position in our core retail markets.

Statoil is the second largest supplier of natural gas to Europe. Natural gas represents a low emission transition to a low-carbon future. Gas will thus have an essential role to play in finding a solution to the climate challenge.

Statoil has been among the industry leaders in terms of high efficiency and emissions per unit of produced oil. We have a long-established record of endeavouring to curb GHG emissions from our activities. Our climate policy sets out the principles for addressing the challenge of global warming and our ambition of maintaining our position as industry leader in relation to sustainable development. The policy covers: 

1. Operations

We endeavour to implement the best available technologies and practices, to operate our facilities with a high degree of energy efficiency and to reduce greenhouse gas emissions. 

2. Products

We promote energy efficiency in the use of our products and track the greenhouse gas intensity of our energy product portfolio.  

3. Renewable energy

We are developing a business portfolio in non-fossil energy and clean energy technologies and carriers.  

4. Carbon capture and storage (CCS)

We are working actively to establish CCS as a business opportunity, and we are evaluating CCS solutions as part of carbon dioxide-intensive projects. 

5. Climate market mechanisms

As part of our portfolio of mitigation options, we are actively engaged in emission trading and project-based mechanisms, and contribute to the development of carbon markets. 

6. Involvement

We engage in activities to increase awareness and understanding of global climate change and the role of business as a provider of solutions. We encourage and work with our suppliers, customers and employees to reduce their carbon footprint. 

7. Leadership

We seek low-carbon and energy-efficient solutions in all areas of our business. 

We aim to continue to work actively together with governments, businesses and other stakeholders to facilitate viable global policies and regulatory frameworks that encourage cost-efficient, renewable and low-carbon energy solutions and the implementation of carbon capture and storage. 

What have we achieved?

We are actively promoting CCS as a key technology to reduce global greenhouse gas emissions. We have helped to put CCS at the top of the political agenda in the EU and elsewhere, influencing the EU's view on this technology and making progress in terms of gaining public acceptance for the technology as a climate change mitigation measure.

In 2008, the Sleipner West field reached an important milestone, with total storage  of carbon dioxide reaching 10 million tonnes since storage began in 1996. The experience from the Sleipner project demonstrates that carbon dioxide can be stored safely. The successful storage of carbon dioxide on Sleipner has been followed by another pioneer carbon storage project - in 2008, the Snøhvit field started injecting and storing carbon dioxide from LNG-production on Melkøya in a geological formation below the gas reservoir.

Together with Gassnova (representing the Norwegian State) and A/S Norske Shell, we are developing a technology centre at our Mongstad refinery for carbon capture technologies, known as the European CO2 Technology Centre Mongstad (TCM). The technology centre demonstration plant aims to help suppliers develop more cost-efficient and safe technologies for carbon capture to handle emissions from different sources, such as gas power, coal power and refineries. The plant will have the capacity to capture up to 100,000 tonnes of carbon dioxide annually, and it therefore represents an important step towards full, industrial scale carbon capture. The TCM project is linked to the Norwegian State and Statoil's project for large-scale carbon capture at the gas power plant at Mongstad. TCM is currently under construction, and it is expected start up at the turn of the year 2011/2012.

In 2009, Statoil crossed a new energy barrier when the company built the world's first full-scale floating wind turbine, Hywind. The 2.3 MW turbine is a pilot of a concept developed by Statoil, located 10 km off the island of Karmøy north of Stavanger, Norway. The test period started in the autumn of 2009 and will last for two years. The Hywind concept is based on combining existing technologies from the wind and oil and gas industry in a new way, and opens up the possibility for capturing wind energy in deep-water environments. .

In 2009, Statoil joined forces with the Norwegian utility Statkraft to develop the offshore wind farm Sheringham Shoal in the UK. Located off the coast of North Norfolk, the 315 MW Sheringham Shoal wind farm will provide enough energy to power almost 220,000 British homes. Comprising 88 wind turbines fixed to the seabed and located between 17 and 22 km offshore, this project will draw on know-how from Statoil's longstanding offshore activities and Statkraft's expertise in renewable energy. The wind farm is owned jointly by Statoil and Statkraft through Scira Offshore Energy Limited. Statoil is operator for the project during the development phase. The project is currently under production and is expected to start up at the end of 2011. Sheringham Shoal was awarded in thesecond licensing round.