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The offshore Norwegian field will be re-developed through the installation of two new subsea templates that will be tied back into the Ekofisk Complex to tap into an estimated 10 million standard cubic metres of oil equivalents Sm3 of recoverable reserves. We will return to this below. Actions to mitigate this risk by large-emitting companies serve the objective of reducing physical climate risk through reduced emissions by aligning production with a lower-carbon future; they can do this in an economic way by sanctioning only on the highest-margin projects.

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The company plans to drill seven production wells in the Tor formation along with a pilot well to evaluate the long-term productivity in the Ekofisk formation. Actions to mitigate this risk by large-emitting companies serve the objective of reducing physical climate risk through reduced emissions by aligning production with a lower-carbon future; they can do this in an economic way by sanctioning only on the highest-margin projects. Companies such as COP are continually investing in the resource base. Separately, it would clearly benefit investors to have similar disclosures from other companies in a like for like basis—COP cannot do this alone; it requires instead that capital markets regulators play a role. That means not just focusing on the supply stack but focusing further on the supply stack in the context of a limited and shrinking carbon budget. The oil and gas field, which was brought into production in , was shut down in after the installation reached the end of its lifetime. Related Article.

Today these are the investments that need to be most carefully managed in the climate context and COP is improving transparency by identifying expected future costs. The oil and gas field, which was brought into production inwas shut down in after the installation reached the end of its lifetime.

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To the extent that physical climate change has adverse macroeconomic impacts that cannot be meaningfully hedged against or diversified away, investors may lose on net, even if individual fossil fuel producers see some local benefit. Conoco, what about the carbon externalities? That means not just focusing on the supply stack but focusing further on the supply stack in the context of a limited and shrinking carbon budget. COP does not conduct this analysis and therefore cannot describe how or why its current resource base fits within a carbon budget built around the Paris climate targets. Indeed, the conclusions COP draws from its scenario work substantiate this point. The offshore Norwegian field will be re-developed through the installation of two new subsea templates that will be tied back into the Ekofisk Complex to tap into an estimated 10 million standard cubic metres of oil equivalents Sm3 of recoverable reserves. The new greenfield facilities will be built nearly a kilometer west of the original Tor platform and will have no connection to the shut-in facilities. Actions to mitigate this risk by large-emitting companies serve the objective of reducing physical climate risk through reduced emissions by aligning production with a lower-carbon future; they can do this in an economic way by sanctioning only on the highest-margin projects. Companies may then choose to return cash to shareholders or diversify into low-carbon businesses. And how do these volumes relate to an overall carbon budget? Related Article. First, COP focuses on the cost of the resource base—not just the proven reserves. In its most recent report, ConocoPhillips COP makes useful progress on the market misread issues but lacks information on how it would fare in a lower carbon budget relative to its peers—it does not view the latter component as helpful to investors. These are risks posed directly to investee companies and require companies to demonstrate discipline in actual and planned capital expenditures.

Their decision to sell reflects a concern about holding high-cost assets; the fact that sales prices did not cover carrying costs illustrates the reality that the best-laid plans may not succeed—whether because of perceived future climate constraints or shifting price expectations more generally.

First, COP focuses on the cost of the resource base—not just the proven reserves.

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Companies may then choose to return cash to shareholders or diversify into low-carbon businesses. These are risks posed directly to investee companies and require companies to demonstrate discipline in actual and planned capital expenditures.

The company plans to drill seven production wells in the Tor formation along with a pilot well to evaluate the long-term productivity in the Ekofisk formation. Moreover, the scenarios only go out to though COP has indicated its next iteration will extend to Indeed, the conclusions COP draws from its scenario work substantiate this point.

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First, COP focuses on the cost of the resource base—not just the proven reserves. COP does not conduct this analysis and therefore cannot describe how or why its current resource base fits within a carbon budget built around the Paris climate targets. In a climate-constrained world, COP agrees that this will likely lead to greater competition on costs; it would be logical to expect such impairment risks to become more significant. Companies may then choose to return cash to shareholders or diversify into low-carbon businesses. Separately, it would clearly benefit investors to have similar disclosures from other companies in a like for like basis—COP cannot do this alone; it requires instead that capital markets regulators play a role. Redevelopment plan for the Tor field The redevelopment project, called Tor II, will be one of the many development opportunities in the Greater Ekofisk Area, that will allow continued operations towards , said ConocoPhillips. First production from the re-developed Tor field is targeted to be achieved towards the end of It addresses transition risk by focusing on becoming a low-cost producer but eschews providing the types of information that would address the climate concerns regarding the dwindling carbon budget that are driving shareholder engagement. These are risks posed directly to investee companies and require companies to demonstrate discipline in actual and planned capital expenditures. Do you have interesting content to share with us?

Like many of its competitors, COP maintains the view that it is a passive supplier of fossil energy rather than an agent in the emerging energy transition. The company is not focused on the carbon externalities generated by its products because it does not view it as a problem it intends to help solve.

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