Oil and gas revenues remain an important source of funding for the transition to green energy, and prematurely implementing overly stringent ESG (Environmental, Social, and Governance) regulations may negatively impact the energy transition itself, BP's Vice President for the Caspian Region, Bakhtiyar Aslanbayli, said at a conference of the American Chamber of Commerce in Azerbaijan (AmCham Azerbaijan), Report informs.
According to him, ESG principles should not be an additional or parallel agenda for companies, but an integral part of business strategy and corporate governance.
"ESG requirements should be formulated as a top-down management model within a company. Governments can establish specific ESG requirements regarding CO2 emissions and other issues. These requirements produce effective results when they are realistic and enforceable. Since the oil and gas sector is a high-risk sector, activities in it are regulated not only by local legislation but also by international standards. The sector already has established market standards for decarbonization, Net Zero goals, and carbon emission reduction. The main task is to maintain and improve these standards in light of new market challenges," he emphasized.
Aslanbayli added that cost optimization has currently become a top priority in both the public and private sectors. As an example, he stated that regardless of the number of wells drilled in BP-operated projects, the budget and personnel for these operations remain unchanged:
"If we drilled 15 wells last year, then this year we will drill 27. This increase will be supported by the same budget and the same personnel resources," the vice president said.