Climate Week NYC - Stranded Assets and Stranded Liabilities: The fossil fuel industry is failing to save for retirement

21 September | New York

The low-carbon transition is shortening the productive lifespan of oil and gas infrastructure – bringing forward the Asset Retirement Obligations (AROs) – and increasing the stranded asset and stranded liabilities to companies and the taxpaying public.

Over $1 trillion of oil & gas assets risk becoming stranded as a result of policy action on climate and the rise in alternative energy sources, with the majority of this unburnable carbon being held by companies listed in just a handful of global financial centres. As assets become stranded due to excessive production costs, retirement costs are accelerated.

So, who will be left to pick up the cost?

In the US, the estimated $280 billion cost to plug onshore oil and gas wells is already pressuring industry, who have no retirement savings, leaving governments and taxpayers to pick up any shortfalls.

It gets more complicated too. Larger companies sell off wells to smaller companies after collecting their profit and thereby avoid any decommissioning and ARO costs.

Regulators, companies and civil society are waking up to this reality. Carbon Tracker has been pioneering analysis on Stranded Assets and Stranded Liabilities but there is a long way to go. This event will bring together the experts, the analysis and lived experiences to explore the following questions:

What risks are investors exposed to through stranded assets and unburnable carbon?
Why do we continue to finance the oil and gas industry?
What is the true cost to retire the oil and gas industry?
How accurate are ARO accounting disclosures and other reported information?
Who could be financially impacted by AROs, and how?