Mubadala Energy’s 2024 emissions cuts signal shift towards cleaner energy

Mubadala Energy, a well-known Abu Dhabi-based player in the energy scene, has reported a pretty notable drop in greenhouse gas emissions for 2024. It really highlights how the company is playing a growing part in the world’s shift towards cleaner energy. According to its latest Sustainability Report, they managed to cut their Scope 1 and 2 emissions by about 36.5 percent—that’s emissions coming directly from their own sources and indirectly from purchased electricity. And get this—they also saw a massive 55 percent reduction in emissions intensity, which went down from 15.57 to 6.95 tonnes of CO₂ equivalent per kilo barrel of oil equivalent (kboe). Pretty impressive, right?

These improvements seem to come from a mix of better production efficiencies, smarter operations, and ongoing efforts to lower carbon output. Interestingly enough, Mubadala also reported a 12.8 percent decrease in emissions from flared gas across its portfolio, which shows they’re serious about curbing wasteful and harmful gas flaring practices. As part of its strategy to make more climate-conscious choices, Mubadala rolled out its first carbon pricing policy in 2024—aiming to factor in climate risks into decision-making and influence investments and operations.

This latest report actually builds on the company’s previous sustainability wins. Back in 2023, Mubadala Energy had already announced about a two-thirds reduction in Scope 1 and 2 emissions compared to the previous year. They also adjusted their fuel mix, increasing the share of natural gas from 66 percent to 69 percent, moving toward cleaner energy sources.

Mansoor Mohamed Al Hamed, who’s the Managing Director and CEO of Mubadala Energy, summarized the report under the theme “People, Energy, Impact.” He made it clear that sustainability is now fully embedded in the company’s daily work—driven by operational discipline, increased efficiency, and targeted decarbonisation projects. On the waste management side, the company recycled 56 percent of its total waste in 2024 and ramped up its efforts to reduce flared gas—showing they’re tackling environmental impact from multiple angles.

On the social side, Mubadala has kept a zero-fatality safety record since it started, and it invests heavily in workforce development; employees averaged 64 training hours each. The diversity of the team is noteworthy too, with people from 32 different nationalities and a higher proportion of women than the industry average. In terms of governance, they set up an ESG (Environmental, Social, and Governance) committee tasked with defining decarbonisation KPIs at the leadership level. And for six years running, they’ve had zero data breaches, indicating solid cyber risk controls.

Now, while these emission reductions are no doubt significant, analysts say maintaining such steep improvements each year will become really tough. The remaining emissions tend to be tied to complex operations that are harder to clean up. Mubadala’s move to implement internal carbon pricing is viewed as a smart way to institutionalize environmental responsibility across its business units. But, of course, how effectively this pays off depends on how strictly they enforce this pricing across different projects and cost centers.

At the same time, Mubadala Energy is expanding into lower-carbon sectors. In 2024, it increased its stake in upstream natural gas and LNG projects through an acquisition in Kimmeridge’s SoTex HoldCo in the US. This indicates a strategic push to balance traditional oil capacities with investments in cleaner energy sources. Plus, the Mubadala Group’s annual review mentioned the launch of Project DeCarb, a partnership with Solutions+ focused on embedding comprehensive decarbonisation planning in its UAE-based portfolio companies—another sign of their broader commitment to sustainability.

However, one notable gap is that the company hasn’t fully disclosed its Scope 3 emissions—the indirect emissions from its upstream and downstream activities. The 2024 report says they’re aligning with emerging global standards for emissions accounting, but full Scope 3 coverage still isn’t there. This is pretty important, since these indirect emissions usually make up the largest part of a company’s carbon footprint in the energy sector.

All in all, Mubadala Energy’s 2024 sustainability results show the industry’s ongoing shift in the UAE’s energy landscape. Their efforts to improve operations, implement carbon pricing, and diversify into lower-carbon energy sources are very much in line with national climate targets and global trends. But as they and the rest of the industry move forward, questions remain—particularly about the long-term sustainability of these aggressive reductions, and whether internal carbon prices and more transparent emissions reporting will truly drive meaningful change in the Gulf’s energy producers.

Source: Noah Wire Services