China grants certificate to its first batch of ‘carbon-neutral’ petroleum

Shanghai Environment and Energy Exchange (SEEE) issued China’s first petroleum carbon neutrality certificate to China Petrochemical Corporation (Sinopec Group), China COSCO Shipping Corporation Limited (COSCO SHIPPING Group), and China Eastern Airlines at a ceremony jointly held by the three conglomerates in Shanghai on Sept. 22.

The day also marked the first anniversary of China’s announcement of carbon peak and carbon neutrality goals at the United Nations General Assembly.

The first batch of crude oil certified as carbon neutral, which weighed 30,000 tons, was from the share of Sinopec Group’s wholly-owned subsidiary, Sinopec International Petroleum Exploration and Production Corporation (SIPC), of crude oil produced in relevant projects in Angola.

It was imported by China International United Petroleum & Chemicals Co., Ltd. (Unipec) under Sinopec Group, transported by COSCO SHIPPING Group, and refined by Sinopec Shanghai Gaoqiao Petrochemical Co., Ltd., a petrochemical company affiliated to Sinopec Group.

There will be 8,963 tons of motor gasoline, 2,276 tons of motor diesel, 5,417 tons of aviation kerosene, 2,786 tons of liquefied petroleum gas (LPG), 6,502 tons of marine diesel, and 2,998 tons of low-sulfur marine fuel oil produced from the imported crude oil.

This year, Sinopec Group plans to make carbon-neutral gasoline and diesel available to the public in certain gas stations and cooperate with China Eastern Airlines to launch carbon-neutral flights.

China Classification Society Certification Company (CCSC), as a third-party verification institution, carried out accurate calculations of the carbon dioxide (CO2) emissions produced during the whole life cycle of the carbon-neutral products, from oil exploitation to the consumption of these products, in a bid to neutralize the equivalents of the greenhouse gas emissions.

According to estimations, the batch of crude oil imported by Unipec produced 103,526.19 tons of CO2 emissions throughout its life cycle.

Sinopec Group was responsible for compensating for the greenhouse gas emissions produced in the exploitation, storage, and processing of the crude oil, the transport of the petroleum products, as well as the combustion of the motor gasoline, motor diesel, and LPG produced from the crude oil; COSCO SHIPPING Group carried out duties of offsetting the carbon emissions caused by the transport of the crude oil and combustion of the marine fuel oil and China Eastern Airlines compensated for the greenhouse gas emissions produced in the combustion of the aviation kerosene.

Giving play to their respective advantages, the three conglomerates jointly established a new model of green transport and blazed a trail for achieving net-zero CO2 emissions throughout the life cycle of products through cross-industry cooperation.

The three Chinese conglomerates have actively offset the carbon emissions generated by the 30,000 tons of crude oil, including buying CO2 emissions quotas from China Certified Emissions Reductions (CCER) and inviting the SEEE for certification.

The CO2 emission quotas purchased from CCER mainly involved projects including a carbon sink and afforestation project in east China’s Jiangxi province and a photovoltaic power plant project in Gantangzi village, Binchuan county, southwest China’s Yunnan province.

While providing financial support for remote regions of the country in boosting agriculture and forestry, developing low-carbon and green energy sources, and consolidating the results of poverty alleviation, these Chinese companies have jointly created China’s first batch of carbon-neutral petroleum products.

There had been few precedents for trade in truly carbon-neutral petroleum in the world due to the long petroleum industrial chain, complex technological process, and difficulty in calculating the amount of greenhouse gas emissions.

Statistics show that the petroleum and gas sector produces about 20 percent of China’s CO2 emissions.

The voluntary carbon offset efforts covered the whole life cycle of the crude oil of Sinopec Group, including the exploitation, transport, refining, and storage of crude oil and the combustion of the finished products, truly realizing carbon neutrality throughout the whole process, said Ling Yiqun, vice president of Sinopec Group.

Ling said that Sinopec Group, COSCO SHIPPING Group, and China Eastern Airlines had assumed their due responsibilities to reduce carbon emissions.

The cooperation among the three conglomerates in achieving carbon neutrality for petroleum products, the first of its kind among China’s petroleum, shipping, and aviation industries for offsetting carbon emissions, has a demonstration effect and represents an active action for promoting carbon neutrality in the world, according to Ling.