Transforming Natural Resource Management for a Sustainable Planet
This paper presents the recent expansion of UNFC guidance to cover social and environmental effects and the further transformation of the system to make it a valuable tool in resource management for governments and businesses.
The global acceptance of the 2030 Agenda for Sustainable Development marked a new era in global development. Natural resources are essential for attaining most of the agenda’s Sustainable Development Goals (SDGs). Whether these measures have created value will depend on why, how, when, and where natural resources are discovered, produced, consumed, recovered, and reconsumed. In response, the United Nations Framework Classification for Resources (UNFC) is transforming into a comprehensive and integrated system that can be used for managing these resources to ensure balanced, responsible, and resilient development. This paper presents the recent expansion of UNFC guidance to cover social and environmental effects and the further transformation of the system to make it a valuable tool in resource management for governments and businesses.
The 2030 Agenda for Sustainable Development, with its SDGs, has ushered in a new era in global development marked by pursuit of economic, social, and environmental gains in equal measure. The transformation is accompanied by a commitment to meeting the needs of two key beneficiaries—the people and the planet—through the common goal of sustainable prosperity for all.
The UNFC is a unified, global system for policymaking, government resource management, business-process innovation, and financial management and reporting that applies to key energy resources, including oil and gas, renewable energy, nuclear fuel resources, minerals resources, injection projects, and anthropogenic resources. The current UNFC grew partly out of the pre-existing United Nations International Framework Classification for Reserves/Resources–Solid Fuels and Mineral Commodities and the Society of Petroleum Engineers Resource Classification of 2000. It largely is compatible with the current SPE Petroleum Resource Management System in that it addresses not just what has been found, which was the case for the earliest classifications, but also what can be gained, in a manner that follows the industrial value chain. The UNFC additionally addresses the economic and social conditions that allow, or do not allow, projects to proceed.
Agenda 2030 makes it imperative to transform resource management to meet these new challenges. This transformation is based on the premise that various stakeholders, such as governments, financial institutions, and commercial enterprises, will require a balanced, integrated, and comprehensive resource-management system fully capable of supporting the realization of SDGs. As a first definitive step, the UNFC has incorporated high-level guidelines for applying social and environmental considerations to resource classification and management, and has incorporated consistent concepts and terminologies in regard to these aspects. Even more-detailed guidelines are being prepared. These guidelines provide the critical social and environmental bases for classification of resources in a manner that facilitates an equilibrium between environmental, social, and economic aspects.
The complete paper is the collective outcome of discussions held with a large number of members of the United Nations Economic Commission for Europe Expert Group on Resources Classification. The paper includes detailed discussions of resource management and the realization of SDGs under the 2030 Agenda for Sustainable Development; the UNFC approach to sustainable resource management, including overarching principles; social and environmental considerations; and the UNFC resource management tool kit. Highlights include the following.
- Changes in consumption patterns will be part of a broader transformation of the society that makes resources easier to acquire and more efficient in their use.
- SDGs cannot be achieved unless natural resources are seen as naturally integrated and indivisible rather than disaggregated as commodities.
- Refocusing resource management means recognizing that what are usually termed “projects” are actually parts of larger processes wherein management challenge shifts toward integrated ecosystem programs to enable development of new skills.
- The UNFC transformation pivots natural-resource management away from a conventional approach centered on oil, gas, minerals, water, and soil to a more-integrated, human-resource-focused model entirely in line with the original Brundtland sustainable development model designed to meet the needs of both present and future generations (Fig. 1). Recentering natural resources around human resources, capacities, and technologies enables the production and use of natural resources to become a regenerative activity—in some cases even circular, so the third use proves more valuable than the second (i.e., helical) rather than linear and extractive as seen today. Additionally, resource-management methodology will move away from a project-focused “push” model of resource use based on extracting value to one that is driven by defining the “pull” of meeting future generational needs. Once these future needs are defined, the pathway to that future can be charted by working backward to the current state. The transformative vocabulary of the redesigned resource pathway substitutes the term “recovery” for “extraction,” and a single resource-management approach is replaced by an integrated, ecosystem-based approach.
- UNFC documentation now includes guidelines on accommodating environmental and social considerations, which constitute the first step toward developing a comprehensive resource-management tool. Perhaps the biggest risk for successful natural resource management is posed by an asymptotic gap between what is possible, in principle, for modern resource recovery, and what is actually accomplished. Artificial intelligence may function as the adaptive bridge that crosses the asymptotic gap if it can enable reverse engineering from transformative outcomes identified at increasingly distant points in the future.
- In the context of aligning future investment strategies with delivering SDGs, fund managers rank SDG 9—“Build resilient infrastructure, promote inclusive and sustainable industrialization, and foster innovation”—in first place as an investment driver. SDG 13—“Take urgent action to tackle climate change and its impacts”—is ranked second, and SDG 7—“Ensure access to affordable, reliable, sustainable, and modern energy for all”—is ranked third.
- In this model, the future management of all natural resources will be decided on the basis of resource innovation, contribution to climate action, and their role as an energy source.
- To satisfy such an approach, the following four “zero conditions” for UNFC-based resource management have been identified, in addition to the requirement that operations be based on valid business cases.
- Zero waste/zero harm
- Social license to operate
- Comprehensive resource recovery
- Integrated materials flowing within a modern ecosystem
- Applying these four zero conditions, the Expert Group on Resource Classification has begun to consider techniques to map the boundaries of the new SDG-driven resource management supported by the UNFC. Once this mapping is further advanced, it will become clearer what the management tool kit might need to contain.
- The UNFC-based management tool kit will benefit primary stakeholders of international policy developers, governments managing their resources, industry deploying their capabilities, and financiers providing the capital. Their joint efforts will benefit local communities, manufacturers and service providers, educators, academia, researchers, students, civil society, and the future inheritors of this planet.
This article, written by JPT Technology Editor Judy Feder, contains highlights of paper SPE 191537, “Transforming Natural Resource Management for a Sustainable Planet,” by David MacDonald, SPE, BP; Julian Hilton, Aleff Group; David Elliott and Sigurd Heiberg, SPE, Petrad; and Harikrishnan Tulsidas and Charlotte Griffiths, United Nations Economic Commission for Europe, prepared for the 2018 SPE Annual Technical Conference and Exhibition, Dallas, 24–26 September. The paper has not been peer reviewed.