Texas Oil & Gas Association (TXOGA)

Summary

Shell benefits from its membership of TXOGA, particularly in relation to its role advising the Texas state government on development of legislation and regulation to better enable growth in business opportunities in carbon capture, utilisation and storage (CCUS) and hydrogen. TXOGA also supports the reduction of methane emissions and flaring across the oil and gas industry in Texas, including through their work with the oil and gas industry to establish and staff the Texas Methane & Flaring Coalition.[3]

We have found TXOGA to have some misalignment with our climate and energy transition-related policy positions. TXOGA has not stated support for the goal of the Paris Agreement or net-zero emissions by 2050. TXOGA has advised us that as a state-level organisation it is not organised or funded to routinely address such issues, which it considers to be federal, not state-level, issues. We also note that TXOGA has not stated positions on a number of related climate and energy transition topics on which we would expect it to state positions.

We have conducted a more detailed review of our membership of TXOGA, and have decided to remain in the association at the current time. We believe that its positions are changing, and that we can have more impact within the association than outside of it. We also recognise the value that TXOGA brings to us in relation to its advocacy on CCUS and hydrogen. Supportive CCUS and hydrogen regulations are crucial enablers for our business strategy in the region to develop industrial decarbonisation hubs. TXOGA has been advancing CCUS with the Texas state government during 2022, resulting in the association authoring a draft CCUS bill for the 2023 Texas State Legislative Session. TXOGA has also provided input into additional bills being drafted in support of hydrogen production projects within the state and associated pipelines for distribution of hydrogen across the state once projects become operational.

We will keep our membership of TXOGA under review during the next 12 months. We will use this period to continue to engage TXOGA, including through our position on TXOGA’s board and our membership of its work groups on carbon management and climate policy.

We will urge TXOGA to update its climate statement to:

• State support for net-zero emissions by 2050 and to publicly advocate for reducing carbon emissions.

We will encourage TXOGA to publish information on its website about:

• Its advocacy on CCUS legislation and regulation.
• Its advocacy in support of decarbonised hydrogen.
• Its support of policies that encourage public and private investment to protect and expand natural ecosystems that store carbon, including policies to ensure that nature-based solutions complement, and do not displace, efforts to avoid and reduce greenhouse gas emissions.
• Its support for improving energy efficiency through standards and regulatory instruments covering key sectors of the economy.

We also encourage TXOGA to:

• Support policies that recognise natural gas and other low-carbon gases as partners for renewable sources.
• Support ending routine flaring by 2030 or sooner. TXOGA, through the Texas Methane & Flaring Coalition, already supports ending routine flaring by 2030, but we encourage efforts to bring that date forward.
• Support accelerating electrification using renewable and low-carbon power sources, and their connection to Texas transmission lines.
• Advocate constructively in support of a carbon price if such policy discussions arise at state level.
• State a position in support of policies to decarbonise road transport.

We will continue to track alignment between TXOGA’s climate and energy transition-related positions and our own and will be transparent about where we find differences. We will continue to engage the association in areas where we have different views. We will provide an update in our next report.