Oil and gas firms across the Asia Pacific (APAC) region are underprepared for the climate transition and lack detailed decarbonisation plans, the Institute for Energy Economics and Financial Analysis (IEEFA) has warned. IEEFA’s new report noted that the region’s oil and gas sector will increasingly struggle to secure the level of fundraising it needs as more financial institutions step back from financing fossil fuel operations, in line with their commitments to alliances formed under the Glasgow Financial Alliance for Net Zero (GFANZ). APAC-based oil and gas companies are more reliant on equity than debt financing as a source of their capital, with the aggregate debt-to-total capital of 259 assessed companies sitting around 32%, the report added. “Despite net zero commitments, the top 20 regional oil and gas producers generate an average of 96% of their revenue directly from oil and gas production and related activities, and many still adopt a wait-and-see approach to new energy investments, lagging global peers,” said Christina Ng, IEEFA’s Research and Stakeholder Engagement Leader, Debt Markets, and co-author of the report.
