Even for an organization as given as the UN to sweeping statements about the future of the world, the words of an official on the UN’s panel on climate change last week were startling: “The next few years are probably the most important in human history,” the official said. The reason for the apocalyptic tone was publication of a landmark report by the UN which said, in a nutshell, that the world was running out of time to avert a climate disaster of mankind’s own making. At current rates of greenhouse gas emissions, we would by 2030 pass the 1.5 degree celsius rise that is enough to wreak climate chaos, and well on the way to a 3 or 4-degree rise that would make the planet uninhabitable. Only an immediate commitment to “carbon neutrality” — taking out as much greenhouse gas as we put in — would give any chance of staying under the 1.5 degree danger level. Not everyone agrees with the dire warnings on climate change, including the current incumbent of the White House, but there are increasing signs that big business, and especially the energy business, is taking the warning signs seriously. In a recent significant victory for the environmental lobby, three of the biggest oil companies in the world — Exxon Mobil, Chevron and Occidental — announced they were ready to take part in the Oil and Gas Climate Initiative, the industry organization which aims to implement the goals of the Paris Agreement (which President Trump ostentatiously left soon after he became president). It is not all selfless altruism from the big energy companies, however. Activist investors have all piled pressure on these energy groups — via lawsuits and the very direct action of disinvestment — to take their environmental responsibilities seriously, if belatedly. In the midst of this new climate change awareness comes no less an organization than Goldman Sachs, the giant US investment bank not well known for its “tree-hugging” inclinations. Goldman has just produced a piece of research entitled “Re-imagining Big Oils,” and offered insights into how the energy companies can successfully adapt to the threat of climate change. In a recent significant victory for the environmental lobby, three of the biggest oil companies in the world — Exxon Mobil, Chevron and Occidental — announced they were ready to take part in the Oil and Gas Climate Initiative Frank Kane You might have expected Goldman to hedge its bets, but it rushes straight in on the side of the environmentalists: “There is growing consensus among policy makers and scientists that global surface temperatures are rising and that the main cause is human-induced emissions of greenhouse gases,” it states. Two-thirds of the greenhouse gas emissions are attributable to the wider energy sector, with coal the biggest culprit. The Big Oil companies are a major part of this pollution chain, producing and marketing around 10 percent of the global carbon emissions. The lesson is there for all to see: If Big Oil can become and remain committed to strategies that reduce carbon emissions, it will go a long way to carbon neutrality. Given the global oil industry’s ability to adapt technologically to new requirements in the first century of its existence, the signs are good that Big Oil can achieve this transformation. Who even 50 years ago could have foreseen the state-of-the-art techniques demanded by deep sea drilling, or shale oil production? Now, Goldman argues, the big oil companies need to become broader, cleaner energy providers, with a deeper presence in the global gas and power chains, including retail, electric vehicle charging and renewables; in biofuels and petrochemicals; and with improved upstream and industrial operations oriented toward carbon capture. That transition will not come easily. It will require “deep cultural and corporate changes,” and, Goldman warns, the higher carbon parts of the production chain, like oil sands and the refining process, may become “financially stranded and underinvested.” By the middle of the next decade, the pace of investment in big oil mega-projects is likely to slow significantly, leading to what Goldman calls “structural underinvestment” in key parts of the oil and gas supply chain and potentially a very tight oil market. But that will be part of the price of transformation in the global energy industry and the battle against climate change. The Goldman report has been getting much scrutiny at the Dhahran headquarters of Saudi Aramco, the biggest of Big Oil. Aramco is pretty much in tune with the thinking already, with its strategy of concentrating on high-technology exploitation of reserves, diversification toward petrochemicals (including the mooted SABIC merger) and other added-value parts of the downstream, and its increasing investment in renewable energy sources. Much human ingenuity has gone into the technological development of fossil fuels over the past century, and it has helped raise living standards and well-being around the world. Now the same amount of smart-thinking has to be devoted to de-carbonizing the planet. Frank Kane is an award-winning business journalist based in Dubai. Twitter: @frankkanedubai Disclaimer: Views expressed by writers in this section are their own and do not necessarily reflect Arab News" point-of-view