From petrol station to “sustainability hub”: the role of the oil and gas industry in energizing local community development

October 24, 2023

The need for economic growth and environmental sustainability has become the defining challenge of our era. As the world races forward in pursuit of progress, the pressing need to conserve and restore our natural environment while alleviating poverty has assumed a paramount role, and must be done in a way that supports the long-term viability and security of food and water systems. The delicate balance between these objectives brings multinationals, particularly in oil and gas, into a pivotal spotlight.

Multinationals in oil and gas are often blamed for environmental crises, including biodiversity loss, habitat degradation, climate change, resource depletion, and threats to human health stemming from environmental and human rights risks. Indeed, some of these effects are the most pronounced in developing markets. That being said, the globalized value chains of oil and gas multinationals also represent a tremendously powerful opportunity for ecosystem and community restoration. How can this be achieved concretely? Through innovation in sustainability strategy.

Whereas much of sustainability strategy in oil and gas has to date been focused on lowering the environmental impact of upstream operations, focusing on downstream operations has never been more important. Indeed, the downstream network of oil and gas companies is among the most well-resourced, sophisticated, efficient and geographically dispersed organizations in the world.

That being said, today's petrol stations are not addressing the true needs of local communities, which they must critically do from an environmental, human and development perspective. While petrol is of course providing essential assistance, too much time and money is spent on selling products that are either unhealthy or of little relevance in the context of broader health, nutrition and development challenges of host countries. This means undergoing a profound analysis of how to move beyond the principal mission of "refueling" to "energizing community development".

Indeed, transforming today's petrol station into a "sustainable development hub" could be the most impactful business innovation of our time. In this briefing, we suggest several avenues for developing this concept, and how the oil and gas industry can use its power for positive transformation in sustainability - both environmental and human.

Building on the idea of the downstream sustainability hub, aligning on-the-ground operations with a broader mission to support communities (and mothers / caretakers in particular), the petrol station of tomorrow could provide health services (especially emergency medicine and maternity/infant support), literacy/numeracy and vocational training, easy-to-access water, washroom and sanitation points, nutritious meals, support with basic administrative formalities (ID cards, tax forms), and mobile banking, payment card and postal services.

In addition to petrol and diesel, the sustainability hub can also be designed to offer renewable-based electricity (including support in installing and maintaining microgrids), clean cooking, refrigeration and charging solutions and even certain transportation services. This will not only help reduce the negative environmental impacts of traditional fuel sources, but also provide vital services and support for local communities.

Multinationals in the oil and gas industry have the financial resources, technological capabilities, and global reach to make these innovative sustainability strategies a reality. By investing in sustainable development hubs at their downstream operations, they can not only mitigate their environmental impact, but also promote economic growth and improve the lives of local communities. This approach aligns with the United Nations' Sustainable Development Goals.

Such a transformation would require strong partnerships between oil and gas companies, governments, NGOs and local communities to ensure efficient operations and effective impact. It would also require investing in research and development to roll-out simple and affordable technologies and models that can support this shift in approach.

Multinationals in the oil and gas industry have the financial resources, technological capabilities, and global reach to make these innovative sustainability strategies a reality. By investing in sustainable development hubs at their downstream operations, they can not only mitigate their environmental impact, but also promote economic growth and entrepreneurship and improve the lives of local communities. This approach aligns with the United Nations' Sustainable Development Goals, including Goal 7 (Affordable and Clean Energy), Goal 8 (Decent Work and Economic Growth), Goal 3 (Good Health and Well-Being) and Goal 4 (Quality Education).

It is clear that the oil and gas industry is making progress towards increasing sustainability engagement, but there is still much work to be done. Shifting towards this paradigm, by implementing a combination of sustainability initiatives and community-driven engagement, solutions can be implemented that go far beyond net zero commitments.

CPM