The country’s vast forests and marshes should play an important role in decarbonisation efforts, according to a 2035 outlook from Russian energy company Lukoil.

This week, as the European Union unveils legislation binding the bloc to lowering emissions to ‘net-zero’ by 2050, much attention is being paid to what exactly this net-zero target means.

The idea behind a net-zero target is to reduce emissions as much as possible, and make up for the rest by sucking carbon out of the atmosphere – for instance by planting forests or burying emissions underground using carbon capture and storage technology.

The European Union isn’t the only one thinking about how continued emissions could be abated. In September, Russia formally joined the Paris Agreement, highlighting the role its vas forest areas can play in storing CO2.

“Russia is making another colossal contribution to combatting CO2 emissions and CO2 sequestration which is not reflected in the contributions but is a crucial factor in this effort,” said a Kremlin spokesperson at the time.

“These are Russia’s boreal forests which are the lungs of the planet,” said the spokesman for Russian President Vladimir Putin.

This week Lukoil, the Russian multinational energy corporation, presented an energy outlook for 2035, updating a previous one in 2016. Climate considerations get more attention in this updated outlook, with a particular focus on how future emissions could be abated through forestry in order to meet the Paris Agreement’s goal of limiting global warming to 1.5 degrees Celsius.

“Afforestation is an important area for reducing CO2 emissions,” said Leonid Fedun, Lukoil’s vice-president for strategic development, presenting the report at a EURACTIV event in Brussels. He pointed to a project in the Lower Volga flood plain, where planting 33 million Paulownia trees has the potential to pull 1 million tonnes of CO2 out of the atmosphere.

“Planting paulownia trees near our Volgograd refinery would capture up to 30t/Ha of CO2 per year and produce valuable wood, feed and biofuels,” he said. “But in the EU, I think there is skepticism about this topic.”

Green Finnish MEP Ville Niinistö and Carlos Calvo Ambel from environmental campaign group Transport & Environment, who also spoke at the event, agreed that such afforestation plans can be an important part of solving the climate crisis. But they expressed doubt about whether such efforts should be recognised in order to reduce the decarbonisation requirements for countries or industry

“Offsets were tried with the Kyoto Protocol,” said Calvo Ambel, referring to the Clean Development Mechanism scheme in which governments and companies could receive credits toward meeting their emissions reduction obligations by funding projects which decrease emissions.

“We can’t be choosing between planting trees and reducing emissions,” he said.

A new focus

Fedun said Lukoil’s new energy outlook represents a change in thinking among the company’s senior management, where climate change is being recognised as a key part of their business strategy.

“We’re looking at the gradual transformation of Lukoil from an oil company to an integrated energy company,” he said. “Lukoil is now number one in Russia for hydropower generation,” he pointed out.

The outlook predicts that, with current climate policies and existing fuel efficiency programs, the demand for liquid hydrocarbons will continue to grow until 2035. But if there are additional environmental restrictions, the peak demand for liquid hydrocarbons may occur before 2030.

The outlook sees abatement measures as key to meeting the Paris Agreement goal. In a ‘climate’ scenario which meets the goal, an active use of carbon capture, utilisation and storage (CCUS) technologies and an increase in the scale of reforestation is assumed. Forest cover is currently stable in Russia, but the scenario would see it start increasing significantly in 2025 through reforestation.

Net neutrality would be reached around 2065, with around 28 billion tonnes of CO2 emissions made up for by CCUS and forestry which would take an equal amount of carbon out of the atmosphere.

“The goals of the Paris Climate Agreement cannot be achieved without wide application of CCUS technology,” Fedol said.

Niinistö disagreed. “Any new investment should go into renewables and energy efficiency,” he said. “Now we need to make a big program of development into renewables, energy efficiency, and new forms of sustainable fuels like hydrogen and biofuels. This is a big shift they have to do and still a lot of the investment is going into the wrong direction,” he said.

Calvo Ambel said he was encouraged by the change in thinking at Lukoil, and that the forestry vision could play a role in the climate solution. But he would like to see the company shift more toward alternative fuels earlier. This, he added, will be particularly important for transport.

“Oil majors potentially have a main role to play in decarbonising transport, but they have to take it seriously,” he said. “A report last year by carbon tracker estimated that in order to protect shareholder value they need to reduce their output by 50% by 2040.”

Fedun said Lukoil’s greenhouse gas emissions have already decreased by 4.3% since 2016. Most of those emissions – 42% – still come from oil refining. 32% comes from power generation, while 23% comes from exploration and production.

Lukoil is planning to introduce a number of measures to reduce greenhouse gas emissions in at its facilities in EU territory, Fedun said.

Examples include an emissions reduction program at a refinery in Zeeland, the Netherlands,  using energy efficiency, CCUS and green hydrogen. There are also solar and energy efficiency plans in Romania and Bulgaria.

For these efforts to be successful, he said, “it is necessary to develop a cooperation program between the EU and Russia at the legislative level as well as accounting system of the CO2 emissions reduction from reforestation activities.”

[Edited by Frédéric Simon]