Global oil companies are pumping billions of dollars into offshore drilling, reversing a long decline in spending on the decades-long projects including some in the remote iceberg waters far off Canada’s Atlantic coast.
Surging oil prices are encouraging the investments, along with Europe’s mounting energy demand as the Ukraine-Russia war drags on.
Offshore production sites are more expensive to build than onshore shale, the last decade’s investment darling. But once they are up and running, they can turn profits at lower prices than other forms of production.
They are also designed to pump oil for decades, a counterintuitive move that could increase financial risk; for the projects as the world pushes for net-zero greenhouse gas emissions by 2050 to slow climate change.
Offshore projects generate fewer emissions per barrel than other forms of oil production due to their massive scale, but they would still increase global air pollution. Environmental groups warn that spills far offshore are hard to clean up.