Petroleum Development Oman

PDO has set targets to reduce its scope 1 and 2 absolute emissions by 50% by 2030, compared to 2019, and by 100% by 2050. However, due to the lack of data reported these targets could not be assessed. PDO should ensure that these targets align with its 1.5°C pathway and cover all of its oil and gas activities. Additionally, PDO should set intermediate targets at gaps of no more than five years to incentivise near-term actions on a longer-term goal. The company should clearly report its base year emissions and any offsetting it intends to use to allow for a complete analysis of its targets and progress against them.

PDO’s scope 1 and 2 emissions intensity increased annually between 2017 and 2021. This does not align with PDO’s 1.5°C pathway, which requires it to reduce its scope 1 and 2 emissions intensity by about 7% per year between 2021 and 2026. In 2021, PDO reports that its priorities are to grow its hydrocarbon operations, establish a differentiated hydrocarbon portfolio, and carbon capture, usage and storage (CCUS) and low-carbon fuels. However, PDO only reports its capital expenditure (CapEx) for 2021 (USD 4.5 billion) and its total projected CapEx for 2022, but not the proportion of this to be invested in low-carbon and mitigation technologies.

Research and development (R&D) expenditure on low-carbon technologies will be essential for PDO to develop a low-carbon product portfolio and be successful in a low-carbon economy. PDO reports that it aims to foster national research and deploy new technologies. However, the company does not disclose any supporting financial information for its R&D into mature and non-mature climate change mitigation nor for its carbon capture and carbon removal technologies. To meet the sectoral-level expectation, at least 77% of the company’s total R&D investments should be dedicated to low-carbon technologies.

PDO has not implemented company oversight of climate change issues. Positions or committees implemented to hold such oversight should demonstrate relevant climate change or low-carbon transition expertise. Although PDO has elements of a low-carbon transition plan, the company should provide more details on its targets (e.g. base year emissions and use of offsets), include financial commitments, outline its review and update process, and outline its commitment to reporting the company’s progress. The plan should be informed by scenario analysis to ensure that the plan’s ambition is sufficient for a 1.5°C pathway.

PDO has set targets to achieve net-zero emissions by 2050 and reduce its emissions by 50% by 2030. Despite these objectives, the company does not specify the emission scopes covered by these targets. Furthermore, PDO has committed to the World Bank Zero Routine Flaring By 2030 initiative.

PDO reports elements of a transition plan, such as emission reduction targets for 2030 and 2050, along with low-carbon electricity generation and alternative fuel business models. But PDO does not demonstrate the intention to develop a complete plan in the near future.

PDO discloses commitment to the World Bank Zero Routine Flaring by 2030 initiative. Its aims to improve the energy efficiency of its facilities and derive 30% of its power capacity from renewable sources by 2025. Supported by the construction of a 78 kilowatt solar rooftop project and the development of another 100 megawatt (MW) solar plant. PDO made a total CapEx investment of USD 4.5 billion, but does not disclose its CapEx spend in low-carbon technologies.

Between 2017 and 2021, PDO’s scope 1 and 2 emissions intensity increased. To align with its 1.5°C pathway PDO needs to decrease its scope 1 and 2 and emissions intensity by about 7% annually. Additionally, between 2017 and 2021 PDO’s scope 1, 2 and 3 emissions intensity marginally decreased. To align with its 1.5°C pathway the company needs to decrease its scope 1, 2 and 3 emissions intensity by about 4% annually.

Although PDO has set a long-term target to achieve net-zero emissions by 2050, it has not reported which emission scopes are covered. The company does not publish a transition plan or report details of financial information to support its low-carbon electricity business models. As part of PDO’s strategy moving forward the company aims to grow safe and cost/carbon competitive hydrocarbon operations.

No evidence was found of the company’s commitment to social dialogue or of the categories of stakeholders the company engages with on a just transition. Furthermore, no evidence was found to demonstrate the company’s ongoing social dialogue and meaningful engagement with affected stakeholders. No evidence was found of the company undertaking just transition planning to mitigate the social impacts of the low-carbon transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue and with stakeholders in its just transition planning.

The company discloses the actions it takes to create more than 3,110 job opportunities through its employment and training initiatives and 13 capability building and employment Memorandums of Collaboration. However, no public commitment by the company was found stating its intention to create and support access to green and decent jobs as part of the low-carbon transition. Moreover, no evidence was found of the company’s action to promote these jobs in a way that ensures gender balance and inclusion of vulnerable groups. Additionally, no relevant disclosure was found of the company’s assessment of employment dislocation risks. The company discloses the actions it takes to training and education opportunities for workers and affected stakeholders. For instance, it provides distance learning scheme which supports 40 staffs to complete their bachelor and masters degree. Furthermore, the company discloses the measures it takes to embed equality of opportunity for women and vulnerable groups in these actions. It does this through funding a community-based vocational training initiative for low-income Omani women. However, no evidence was found of the company having a process for identifying skills gaps for workers and stakeholders affected by the low-carbon transition or a public commitment to help workers displaced by the transition to reskill or upskill.

No relevant disclosure was found to show if the company identifies impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to social protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders. No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.

No policies or commitments of the company related to respect for human rights were found in the public domain. This includes the necessary policies and systems by which the company can ensure respect for basic human rights in its operations and supply chain.

While the company commits to respecting the health and safety of its workers, no evidence was found that it expects the same commitment of its business relationships. No evidence was found of a time-bound target for paying all workers a living wage. No evidence was found that the company discloses the proportion of its direct workforce covered by collective bargaining agreements and the company’s required working hours. The company discloses the gender of its workforce by employee category. However, no relevant disclosure was found of additional indicators of workforce diversity. No evidence was found that the company commits to gender equality and women’s empowerment.

The company commits to protecting personal data. However, no evidence was found of a privacy statement regarding the collection, sharing and access to personal data. No relevant disclosure was found of the company’s global tax strategy and the corporate income tax paid for each relevant jurisdiction. While the company has a policy prohibiting bribery and corruption, no evidence was found that it includes corresponding clauses in its contracts with business relationships. No evidence was found that the company has a lobbying and political engagement policy and that it specifies that it does not make political contributions. Moreover, no relevant disclosure was found of the company’s expenditure on lobbying activities.