Greens' new front in climate war with ExxonMobil

Oil giant ExxonMobil is responsible for some 5% of global carbon dioxide emissions over the last 120 years, according to research by Friends of the Earth.1 Environmentalists claim that such work could eventually lead to major corporations being sued for damages arising from climate change - a proposition which ExxonMobil dismisses as "absurd".

For several years, ExxonMobil has been the focus of environment groups' campaign to put climate change on the corporate agenda (ENDS Report 330, pp 25-28 ).

The latest attack focuses on the company's historic contribution to climate change. FoE claims that its research is the first time that one company's historic emissions have been calculated - and there is little doubt that other major energy companies are likely to come under similar scrutiny in future.

In the main part of the research, US consultancy Climate Mitigation Services compiled an inventory of the company's emissions from 1882 to 2002. Exxon and Mobil were created in 1911 when the US Standard Oil Trust was broken up. The two businesses merged in 1999 to form the world's biggest oil company.

Emissions were estimated on the basis of the company's production and marketing data. But emissions from internal energy use, flaring and venting and methane leakage had to be estimated.

Over the past 120 years, the report found, ExxonMobil has been responsible for 20.3 billion tonnes of CO2 - 4.7-5.3% of total man-made emissions over the same period, and three times greater than current global emissions from fossil fuel combustion. The figure rises to 21.5 billion tonnes of CO2 equivalent when the company's methane emissions are included.

Of the total release, 82.3% arose from customers burning the company's products. Less than 10% arose from the company's own energy use, with the remainder stemming from venting and flaring and methane leakage.

A second report by New Zealand-based consultants NIWA concludes that Exxon has contributed some 5ppm to atmospheric CO2 concentrations - representing 4.8-5.5% of the total increase above pre-industrial levels. The company's contribution to temperature increases and projected sea level rises is lower at around 3-4%.

FoE director Tony Juniper said the findings "bring closer the day when the victims of climate change can take legal action against ExxonMobil for the damage its activities have caused and will cause in the future." A law suit is already under way against the US export credit agencies for funding fossil fuel projects, and the Inuit Circumpolar Conference is also considering a claim against the US government on the grounds that climate change will infringe Inuit human rights. Paul Dickinson, coordinator of the Carbon Disclosure Project (ENDS Report 346, pp 21-24 ), also warned that "precedents set by asbestos and tobacco litigation could lead to a spate of law suits against significant emitters."

FoE is calling on ExxonMobil to accept that climate change is occurring as a result of fossil fuel use - and to set aside a segregated fund to meet any claims that may be made against it. It argues that "the potential financial cost for the company is impossible to quantify yet could clearly be vast". Insurance agency Munich Re has estimated that worldwide damage from climate change could exceed $300 billion per year by 2050.

The state of knowledge about climate change risks would probably be an important factor in any future litigation. FoE says that 83% of ExxonMobil's emissions have occurred since rising atmospheric levels of CO2 were first detected in 1960. Roughly a quarter has occurred since 1992, when the UN Framework Convention on Climate Change was signed in Rio de Janeiro.

Peter Roderick of the Climate Justice Programme, an umbrella group set up to support enforcement of legislation on climate change, says that ExxonMobil would struggle to plead ignorance. He cites company documents which claim that: "Since long before climate change became a major public policy issue, ExxonMobil scientists have been involved in research to address the issue."

ExxonMobil said that any allegation that it is not taking a constructive approach on climate change is "completely and utterly unfounded." "The implication of the FoE assertion is that every company which has produced oil, coal or gas has potentially been acting illegally in supplying fuels vital for society," it said. "Our view is that such a proposition is absurd."

In early February, ExxonMobil issued a study on energy trends which forecast that global energy demand will increase by 40% by 2020 - with 80% of the growth in developing countries.2 The company recognises that "although scientific evidence remains inconclusive, the potential impacts of greenhouse gases on society and ecosystems may prove to be significant."

However, ExxonMobil continues to take a sceptical line on renewable energy, arguing that this does not meet its focus on delivering shareholder value, but is quietly shifting its business towards less carbon-intensive fuels such as natural gas. In the short-term, at least, the strategy is reaping rewards - the company's net income in 2003 soared by 88% to $21.5 billion.