By Fabiana Negrin Ochoa
A collaboration between Chinese oil major Sinopec, COSCO Shipping Holdings Co. and China Eastern Airlines Corp. has yielded the country's first carbon-neutral petroleum shipment after the three companies offset the carbon dioxide produced throughout the cargo's full cycle from production to shipping.
The Shanghai Environment and Energy Exchange granted the three companies the certification at a ceremony Wednesday.
"This carbon-neutral petroleum project has achieved carbon neutrality from the 'cradle' to the 'grave' with every drop of oil," Sinopec Group Vice President Ling Yiqun said in a statement.
The 30,000-ton shipment of crude was produced in Angola, and transported more than 9,300 nautical miles across the Atlantic, Indian and Pacific oceans by Cosco before arriving at Ningbo-Zhoushan Port, one of the busiest in the world. The oil was then taken to Sinopec's Gaoqiao Petrochemical Corp. refinery.
To neutralize the CO2 produced over the journey, the companies divvied up the offsetting in stages. Sinopec handled emissions from the exploitation, storage, processing and transportation of petroleum, motor gasoline, and diesel and liquefied petroleum gas combustion, while Cosco took care of crude oil transportation and marine-fuel combustion emissions, and China Eastern offset those from aviation kerosene combustion.
The offsets were made via energy-saving and emission-reduction strategies as well as the purchase of Chinese Certified Emission Reduction carbon credits.
The companies hired SEEE, which operates China's emissions-trading scheme on its platform, to serve as the certification authority for the project, Sinopec said. The China Classification Society Certification Company, a professional certification body affiliated with the China Classification Society, served as a third-party verifier to measure the CO2 emissions.
The project comes as energy companies world-wide bid to decarbonize their products amid mounting environmental pressure from governments. A division of Occidental Petroleum Corp. delivered the world's first carbon-neutral shipment of crude in February, sending 2 million barrels to India's Reliance Industries Ltd. Sinopec peer PetroChina Co. received its first carbon-neutral liquefied natural gas shipment in July under a five-year supply deal with a Royal Dutch Shell PLC subsidiary.
Sinopec said Wednesday that it hoped the project would help chart the path to carbon-neutral oil trading and cross-industry collaboration.
The energy giant, which aims to be carbon neutral by 2050, is preparing to roll out carbon-neutral gasoline and diesel products sometime this year. It will also keep working with China Eastern on carbon-neutral flights, including by supplying the carrier with 5,417 tons of jet fuel. Sinopec plans to ramp up production capacity for "green hydrogen"--made from renewable sources--and aims to launch its first green hydrogen plant next year.
Write to Fabiana Negrin Ochoa at firstname.lastname@example.org
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