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Why are the energy transition leaders not (yet) being rewarded by oil and gas investors?

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09 June 2022

Why are the energy transition leaders not (yet) being rewarded by oil and gas investors?

Report summary

Equity markets are not rewarding decarbonisation progress in corporate valuations. But deferring decarbonisation strategies would be a strategic mistake. The move towards more certain, more quantifiable, and more immediate carbon risk is inexorable. The window to avoid material value erosion will start to close. Today’s crisis could even accelerate the period in which oil and gas companies can reposition for a low carbon future. We look at the factors weighing on greening strategies and why oil and gas companies must act now to avoid longer-term value erosion.

Table of contents

Tables and charts

This report includes 6 images and tables including:

  • It's not easy being green: Market premium to Wood Mackenzie's group valuation, by CoRSi transition rating*
  • Wood Mackenzie’s estimate of free cash flow from wind and solar*
  • Wood Mackenzie’s carbon price forecast for a 1.5-degree scenario*
  • Upstream NPV10 at risk from Scope 1 and 2 emissions under our 1.5-degree carbon price scenario**
  • Wind and solar operating cash flow as a % of total group operating cash flow*
  • PE and PCF multiples for 2022 as of 27 May 2022

What's included

This report contains:

  • Document

    Why are the energy transition leaders not (yet) being rewarded by oil and gas investors?

    PDF 843.90 KB