Wood Group, an international engineering company, has faced criticism from environmental groups for expanding its oil and gas business while scaling back its renewables operations after receiving a £430 million government-backed “green transition loan.”
An analysis of Wood Group’s financial results by The Guardian and investigative journalism organisation Point Source revealed that the company’s upstream oil and gas business experienced a 17% growth, generating over $3 billion (£2.4bn) in revenue in 2022, compared to $2.6 billion (£2bn) in 2021.
In contrast, its renewable, hydrogen, and carbon capture business units saw a 35% reduction, resulting in revenues of only $222.8 million (£177.9m) in 2022, down from $344.6 million (£275.2m) in 2021.
Wood Group emphasised its dedication to actively participating in the energy transition across the short, medium, and long term, according to its statement.
It added: “A significant part of our role is also supporting our oil and gas and wider industry clients to decarbonise their operations. The KPI measures of the loan centre on reducing our own scope one and two emissions and growing our sustainable revenues. We are pleased that we achieved a 65% reduction in our scope one and two emissions.
“Wood’s business was repositioned following the sale of the Built Environment business in 2022 and following this change, we paid down two-thirds of the bank loan value. This change was a contributing factor to the reduction in our sustainable revenues in 2022. However, we have stated that we anticipate significant growth in sustainable revenues from sectors such as hydrogen and carbon capture, utilisation and storage through to 2025 and beyond.”
A UK Export Finance spokesperson told ELN: “We are firmly committed to supporting the UK’s transition towards a low-carbon economy as part of our 2050 net zero target.
“Our Transition Export Development Guarantee requires firms to report progress against a Climate Transition Plan to deliver their commitments.”
ELN has approached Wood and Crisil for comment – they did not respond before publication.
Article source: https://www.energylivenews.com/2023/06/08/uk-firms-green-loan-raises-concerns-as-oil-and-gas-business-expands/
