UBS BB: Petrobras makes ESG progress but still faces challenges

A few days after Petrobras CEO José Mauro Coelho spoke about measures the state-controlled oil company has taken to reduce its carbon emissions, analysts at Swiss bank UBS BB released a report stating that the firm is indeed advancing in its ESG (Environmental, Social, and Governance) agenda, albeit in a timid fashion. 

During an event last Wednesday, Mr. Coelho said that Petrobras is considering creating an offshore wind farm at the Campos Basin in the state of Bahia, in partnership with Norwegian company Equinor. Regarding the initiative itself, the bank’s analysts said that Petrobras is still more focused on reducing its greenhouse emissions, with investments in renewable energy remaining small. 

Per the bank, Petrobras’s focus has been on bringing results. On the extraction front, its core business, analysts pointed out that the state-owned company reduced its greenhouse gas emissions by 48 percent to 15.7 kilos of carbon dioxide for each barrel of oil equivalent, compared to that recorded in 2009. 

The improvement is mainly due to the fact that part of the oil extracted from Petrobras’s pre-salt deepwater reserves is normally “cleaner” than average.

Petrobras has also made progress in its ways of reinjecting carbon dioxide from extraction into the fields themselves, said the analysts, with the Carbon Capture, Utilization, and Storage (CCUS) programs. Between 2008 and 2021, the company reinjected around 30 million tons of carbon dioxide into the reservoirs.

By 2025, the state-owned company expects to have injected 40 million tons.

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