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UPDATE 7-France's Total quits top U.S. oil lobby in climate split

Fri, 15th Jan 2021 13:44

* Total says will not renew API membership

* French firm's policies only 'partially align' with the API

* Total, BP, Shell already quit U.S. refining group AFPM
(Recasts, adds comments from BP, Chevron)

By Ron Bousso

LONDON, Jan 15 (Reuters) - France's Total SE on
Friday became the first major global energy company to quit the
main U.S. oil and gas lobby due to disagreements over its
climate policies and support for easing drilling regulations.

Total said it would not renew its 2021 membership with the
American Petroleum Institute (API) following a review of the
lobby's climate positions, describing them as being only
"partially aligned" with its own.

The high-profile departure from the most powerful energy
lobby comes ahead of sweeping changes in policy direction in the
United States, with incoming President Joe Biden promising to
tackle climate change and bring the country to net-zero
emissions by 2050.

"As part of our climate ambition made public in May 2020, we
are committed to ensuring, in a transparent manner, that the
industry associations of which we are a member adopt positions
and messages that are aligned with those of the Group in the
fight against climate change", Total Chief Executive Patrick
Pouyanné said.

The withdrawal highlights a widening rift between Europe's
top energy companies, which over the past year accelerated plans
to cut emissions and build large renewable energy businesses and
their U.S. rivals Exxon Mobil Corp and Chevron Corp
that have largely resisted growing investor pressure to
diversify.

Chevron has no plans to leave the API, company spokesman
Sean Comey said. Exxon was not immediately available for
comment.

The announcement puts pressure on Total's European rivals BP
and Royal Dutch Shell to follow suit after
resisting the move in recent years.

BP, Shell and Norway's Equinor on Friday said they
are reviewing memberships in trade organizations and how they
align on climate-related issues. Shell spokesman Curtis Moore
said "API is moving closer to Shell’s own stated views" on
climate change.

European oil companies have in the past pointed to the API's
role in formulating industry safety and operating standards as
their rationale for remaining with the group.

However, in its reasons for leaving the group, Total cited
the API's support for last year's rollback of U.S. regulation on
emissions of methane, its differing views on pricing carbon, as
well its lack of support for subsidies for electric vehicles.

The API thanked Total for its membership, but noted that it
does not support subsidies for energy, saying it distorts
markets.

"We believe that the world's energy and environmental
challenges are large enough that many different approaches are
necessary to solve them, and we benefit from a diversity of
views," the API said.

The group has defended its record on tackling carbon
emissions, noting that the industry's technological advances
have helped it cut carbon dioxide and methane emissions rates in
large oil-producing regions.

Total last year announced plans to cut its carbon emissions,
with the aim of reaching net zero emissions from its operations
and its energy products sold to customers in Europe by 2050 or
sooner.

Total's operations in the United States include a number of
offshore oil and gas fields in the Gulf of Mexico, a major
refining and petrochemical plant in Port Arthur, Texas, as well
as renewable energy businesses. The company produced about
343,000 barrels of oil equivalent per day in the third quarter
in the Americas.

SIGNIFICANT MOVE

Growing investor pressure has spurred Europe's top energy
companies to outline plans to curb emissions and boost renewable
energy output.

"There is simply no justification for any association with
lobby groups who roll back emissions regulations and undermine
urgent climate action," said Jeanett Bergan, head of responsible
investment at KLP, Norway's largest pension fund, which manages
$80 billion in assets.

Total, BP and Shell have already pulled out of the American
Fuel & Petrochemical Manufacturers (AFPM), a U.S. oil refining
group, also due to differences over climate policies.

The withdrawal from API was more significant, said Andrew
Logan, director for oil and gas programmes and clean energy
investor group CERES, said the announcement was significant and
would put pressure on other European oil majors.
"Given the size and influence of API, this is a much more
significant move than previous decisions to pull out of more
niche trade groups like AFPM. I think that we will see other
companies follow suit," Logan said.

(Reporting by Ron Bousso, Matthew Green and Shadia Nasralla in
London, Nerijus Adomaitis in Oslo, Valerie Volcovici in
Washington and Jennifer Hiller in Houston; editing by Jan
Harvey, Jason Neely, Jane Merriman, Marguerita Choy and Louise
Heavens)

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