“Many climate-related issues are wreaking havoc on the industry, with recent examples including severe water level drops in the Mississippi River and supply chain interruptions in the Panama Canal,” the North Carolina-based non-profit organisation noted in its study.

“The change in climate impacts the overall productivity of a vessel; the routes are affected, resulting in changes in plans and cargo losses,” it stated further, as it predicted another loss figure of up to USD 25 billion a year by 2100 due to the damage and disruption caused by ports alone.

The shipping sector has reportedly been sluggish of late, when it comes to cutting carbon emissions. Although Danish shipping and logistics company Maersk has been using Green methanol to power its container ships, the fuel’s high price and restricted supply have hampered the transformation process.

Worldwide Greenhouse gas emissions from the shipping sector, as of November 2023, are around 3%. The RTI International’s findings come at a time when the sector has committed to acquiring net-zero emissions by 2050, with experts asking for the implementation of vigorous measures to meet the targets set forth in the Paris Agreement.

The agreement was adopted at the 80th meeting of the International Maritime Organization’s Marine Environmental Protection Committee (MEPC), conducted in the earlier half of 2023. The pact united all 175 member states in a common objective, which was to ensure “a just and equitable transition to a 20-30% reduction in shipping emissions by 2030, progressing to a 70-80% reduction by 2040.”

The roadmap involves setting robust interim emission reduction targets for 2030 and 2040, apart from committing to a lifecycle approach for assessing emissions to avoid shifting emissions from sea to land, specifying a clear and rapid timeline for adopting and applying binding regulatory measures and last but not the least, making a commitment that shipping industry’s green transition will be just and equitable, and leave no one behind.

“Over the next seven years, the 2030 target will be met by transitioning 5-10% of marine fuels to zero-emission alternatives, in alignment with the Climate Champions 2030 Shipping Breakthrough. Additionally, all ships being ordered from now on must be capable of running on zero-emission fuels by 2040 if they are to be useful for their full lifespan. Global mandatory measures and regulations will enter into force in 2027, consisting of a global GHG fuel standard and an economic measure that sets a price on GHG emissions based on the full lifecycle emissions,” the pact read.

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IEA Executive Director Fatih Birol said in a statement, “The scale and speed of the efforts demanded by this critical and formidable goal … make this perhaps the greatest challenge humankind has ever faced.” But on a positive note, the report mentioned if there is an investment of $5 trillion per year by 2030, it could provide a much needed major boost to the global economy, by adding millions of jobs in sectors such as clean energy, energy efficiency, and manufacturing, which, in turn, will also increase the global GDP growth by 0.4 percent per year.

In order to achieve this objective, the spending on new oil and gas projects needs to stop immediately, but investment in existing reservoirs could continue, the report mentioned. Additionally, no new coal-powered stations should be built unless they already include the required technology to capture emissions. In order to curb the emissions by cars, the sale of electric vehicles should be increased to 60% globally by 2030. The report also mentioned that the oil demand should be reduced to 24 million barrels a day in 2050 and it should never exceed 100 million barrels, as we saw two years ago.

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Adnoc is already among the top five lowest greenhouse gas emitters in the oil and gas industry with methane emissions as low as 0.01 percent.

Dr Sultan Al Jaber, Adnoc group chief executive and Minister of State told the media, “We are taking a comprehensive and holistic approach to our sustainability strategy in terms of our contribution to the economy, the environment and our most important asset, our people. We are strengthening our environmental performance as we expand our operations to ensure we can deliver more energy with fewer emissions for decades to come.”

He further revealed that Adnoc will continue to work in partnerships to prioritise sustainability and will continue to make investments in new and innovative technologies to improve environmental performance.

Besides announcing its plan to reduce greenhouse gas emissions, Adnoc also announced a range of other green initiatives such as limiting its freshwater consumption ratio below 0.5 percent of total water use and achieving an in-country value (ICV) of 50 percent across its full value chain by 2050.

Adnoc’s shipping unit, Adnoc Logistics and Services also announced that it will carry out tests to use biofuel in its vessels to cut sulphur emissions and comply with the 2020 sulphur cap.

According to local media reports, the company is exploring other alternatives such as LNG, LPG and blended biofuel to reduce fuel consumption as well as cut emissions.

Last month, Adnoc also signed an agreement with Italy’s ENI to explore collaboration on carbon capture, utilisation and storage as a part of its goal to cut emissions.

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