How Do Oil Companies in Emerging Country Manage Carbon Emissions to Improve Sustainability Reporting? A Case Study of PT Pertamina
DOI:
https://doi.org/10.5755/j01.erem.81.3.40381Keywords:
PT Pertamina, oil and gas, decarbonizing, sustainability reporting, emissionsAbstract
BACKGROUND AND OBJECTIVES: As an energy-intensive industry, oil and gas companies are pivotal in addressing carbon emissions while advancing sustainable practices. This study examines PT Pertamina, Indonesia's foremost oil and gas company, in achieving decarbonization objectives and enhancing its Environmental, Social, and Governance (ESG) performance. This study evaluates Pertamina’s initiatives in mitigating greenhouse gas emissions, advocating for sustainable business practices, and contributing to Indonesia’s emission reduction targets.
METHODS: The research utilizes a combination of scientific literature and corporate reports, including sustainability disclosures, to scrutinize Pertamina’s carbon management strategies. The analysis focuses on the company’s Scope 1 and Scope 2 emissions reduction achievements, decarbonization programs, and the coherence of these initiatives with its ESG pledges.
FINDINGS: PT Pertamina has surpassed its 2023 Scope 1 and Scope 2 emissions reduction target by 124%, decarbonizing 1.13 million tons of CO2e. The company has made significant progress in decarbonizing its business activities and establishing sustainable businesses, securing its leading position in the Sustainalytics ESG evaluation for integrated oil and gas companies. Furthermore, the sale of B35 biodiesel products has led to a reduction of 28 million tons in emissions annually, showcasing Pertamina's leadership in green energy development.
CONCLUSION: PT Pertamina’s success in surpassing emissions reduction targets and improving its ESG performance underscores its dedication to sustainability. The company’s decarbonization endeavors, propelled by innovative technologies and sustainable business practices, support Indonesia’s goals to achieve net-zero emissions by 2060. This case study serves Pertamina’s exemplary role in the oil and gas industry in developing countries.
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