February 2025 | Carbon Minefields Oil and Gas Exploration Monitor

In January 2025, global governments awarded around 75,000 square kilometres to the oil and gas industry to explore new resources. These leases represent the highest volume of embodied emissions over the past year. Norway awarded more than half of the new licences last month.

A series of updates to estimated resources in blocks licensed in the past 12 months have reordered the table of top expanders. The United States has jumped from fifth to first place in terms of embodied emissions, while Mozambique dropped right out of the table from first place. Six licences awarded by Mozambique in May 2024 that were previously thought to contain more than 11 trillion cubic feet of gas have been written down to almost nothing. This underscores the risks to Mozambique of banking on gas exports for its economic development.

Looking ahead, governments are planning 155 licensing rounds in the next 6 months, with embodied emissions of 12 billion tonnes of CO2 if fully exploited. While the planned licensing spree suggests that some governments continue to bet on future oil and gas development, broader industry trends point to a more cautious approach to exploration spending, with companies prioritizing financial resilience and fewer projects reaching final investment decisions.

Monthly Update

New Exploration Licences Awarded

Last month, 77 oil and gas exploration licences were awarded in seven different countries, with Norway leading in terms of embodied emissions. Norway awarded 53 new licences, which included 48.6 million barrels of oil and 1,130.6 billion cubic feet of gas that would result in 95.3 million tonnes of CO2 emissions if burned. Overall, the total emissions that would result from burning all the newly licensed reserves could amount to 180.0 million tonnes of CO2.

Oil and Gas Companies' Exploration Activities

During the last month, Equinor, APA Corporation, and Aker BP were the companies that invested the most into oil and gas exploration projects, with a combined expenditure of USD 941.1 million out of the total global exploration capital expenditure (CapEx) of USD 2,722.7 million. Among expanding companies, Shell, Equinor, and Aker BP acquired exploration licences with the largest estimates of oil and gas volumes. These licences were predominantly awarded by Norway and Egypt. The embodied emissions linked to these licences pose significant climate risks.

Rolling Annual Update

Licences Awarded

Estimated discovered resources in licensed reserves get updated regularly as Rystad continuously seeks to reassess their oil and gas volumes based on companies’ future drilling activity, historical exploration spending, and the exploration efficiency of the basin where the awarded blocks are located. Last month, Rystad’s database reflected major updates on discovered resources in licences awarded over the past year. For example, licences awarded by Mozambique in May 2024 were expected to contain more than 11 trillion cubic feet of gas, but this expectation has now been placed at almost zero, as no exploration wells are expected to be drilled in the near future.

Over the last 12 months, 1,028 oil and gas exploration licences were awarded, with the licensed reserves estimated to result in 1,216.5 million tonnes of CO2 emissions if burned. January 2025 had the highest volume of embodied emissions, with 180.0 MtCO2. The United States awarded licences with the highest volume of embodied emissions, followed by Russia and Norway.

Note: The embodied carbon emissions from newly awarded licences are presented based on 4 country groups based on the Civil Society Equity Review (2023) categorization. Countries are grouped based on two main axes: 1) their capacity to transition and 2) their dependence on fossil fuels, which provides a rationale to determine how fast they should phase out their domestic production. These indicators are measured based on countries' ability to deal with the costs and disruptions of climate change and historical emissions; as well as an assessment of how much a country’s socio-economic welfare is dependent on extraction.

Exploration CapEx

In the last 12 months, the total capital expenditure on oil and gas exploration projects reached USD 23.2 billion, with projects awarded in August 2024 attracting the highest investments. On average, monthly CapEx stands at USD 1.9 billion. Eni, Chevron, and Elysian Petroleum invested the most in expansion, collectively allocating USD 4.5 billion toward exploration projects.

Outlook

Ongoing and Upcoming Licensing Rounds

As of last month, 31 lease rounds opened for bidding or were under evaluation for oil and gas exploration. Looking ahead to the next 6 months, there are plans for an additional 155 licensing rounds. The estimated global emissions that could result from burning the fuel reserves in these upcoming rounds is 12,028.4 MtCO2, of which China would be contributing the most, at 9,379.3 MtCO2.

About the Carbon Minefields Newsletter

This newsletter provides monthly updates on oil and gas expansion globally, reporting on every new oil and gas exploration licence awarded. It also tracks the climate impact of these licences, translating them into total embodied emissions—that is, the amount of CO2 released into the atmosphere if the licensed oil and gas is extracted and burned. Finally, the monitoring of companies’ spending to explore and develop new oil and gas fields provides additional insights into the industry’s expansion activities. Certain data are segmented according to countries’ capacity to transition away from oil and gas.

Halting new fossil fuel projects is a key step in limiting global warming to 1.5°C and transitioning away from fossil fuels, as agreed by 198 countries at the 28th UN Climate Change Conference (COP 28). Research by Green et al. (2024) in Science shows there is more than enough oil and gas in existing fields to meet Paris-aligned energy demand. Accordingly, the Carbon Minefields newsletter monitors efforts to expand oil and gas production beyond already operating fields—flagging misalignment with the Paris Agreement target.

The data above are collected by experts at the International Institute for Sustainable Development (IISD); we use AI and programming tools to extract and analyze data from Rystad Energy (2025) before reviewing all content for accuracy and clarity.

This newsletter is produced using data from Rystad Energy (2025) extracted from the UCubeExploration Browser v. 2025-02-13 and published with Rystad’s permission. Embodied emission estimates were calculated by the authors using the Intergovernmental Panel on Climate Change emission factors of crude oil, condensate, natural gas liquids, and gas. Data manipulation is automated with Python programming. Most text is generated with OpenAI's application programming interface using GPT-3.5 Turbo. The AI-generated outputs for this edition were produced on February 13, 2025. International Institute for Sustainable Development experts review all AI-generated content for accuracy, clarity, and further interpretation.

For more information regarding the data presented and for national-level disaggregation, please contact us at oboisvonkursk@iisd.ca or ceposadap@iisd.ca