Nabors Industries Ltd. ( NBR Quick Quote NBR - Free Report) and firms across the oil and gas value chain set ambitious decarbonization targets. The sector now needs the means to meet the same. As a result, NBR is happy to launch Nabors Energy Transition Solutions (NETS), a rapidly expanding portfolio of solutions aimed at increasing the energy efficiency and lowering emissions of both itself and the third-party clients. The line-up currently comprises unique emissions monitoring and analytics software, engine management controls, energy storage devices, hydrogen injection catalysts, carbon capture technologies and fuel optimizing additives along with typical high-line power and dual-fuel solutions. All of this is aimed at making Nabors' fleet the cleanest and the most efficient in the business. NBR aims to expand these technologies beyond drilling into the wider upstream market in the future. Nabors is also looking to extend some of its solutions outside oil and gas, such as the large numbers of engines used in marine applications and power production today. Nabors has so far made strategic investments in three geothermal companies, namely, Geo-X Energy, SAGE Geosystems and Quaise through its Nabors Energy Transition Ventures business. Management stated that other initial targets will include alternative energy sources, such as hydrogen, energy storage and carbon capture. Nabors Energy Transition Corporation (NETC), a newly-created special purpose acquisition company and an affiliate of Nabors, raised $276 million in an initial public offering. NETC was established to achieve a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination with one or more enterprises. In the energy transition area, it plans to seek an initial business combination target. While this Hamilton-based energy firm expands its business portfolio by pursuing new decarbonization possibilities, it remains dedicated to its prudent capital-management and debt-control policies. Its current focus on drilling automation and digitization is well linked with improving the current energy scenario while also reacting to global sustainability issues. In its existing business, the currently Zacks Rank #3 (Hold) player expects the continuous expansion and innovation. Nabors sees the present extension of its overall strategy as an excellent opportunity to deliver some handsome incremental returns. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here . The Net-Zero Scenario Carbon neutrality, also termed net zero, refers to a situation wherein all carbon (and other greenhouse gas or GHG) emissions are offset by absorbing the same from the atmosphere. This is an important yardstick by climate scientists to ensure that global warming is limited to 1.5°C above the pre-industrial levels by 2050, in sync with the Paris Climate Agreement. Of late, the concept gained traction operationally with companies across a diverse spectrum laying out concrete strategies about their future sustainability endeavors. For the energy operators in particular, the pressure to decarbonize is intensified by institutional investors and major clients committed to an ESG agenda, thereby snubbing the carbon emitters. As the focus on energy transition deepens, let’s look at some of the oil and gas companies aiming to achieve net-zero emissions by 2050. It all started with Repsol ( REPYY Quick Quote REPYY - Free Report) , which in December 2019, announced its non-binding plan of reducing net carbon emissions to zero by 2050. The move by the Spanish firm, which complies with the Paris Agreement climate goals, marked the first such initiative in the oil and gas industry. REPYY is expected to use its 2016 carbon intensity level as the baseline. It plans to reduce 10% intensity by 2025 and 20% in the next five years. Repsol expects carbon intensity to fall 40% by 2040 and reach 100% by 2050. In February 2020, BP plc ( BP Quick Quote BP - Free Report) announced a plan of curbing net carbon emissions to zero by 2050 or sooner. This London-based energy behemoth plans to sell assets worth some $25 billion to finance its green energy push. As part of its net-zero ambition, BP vowed to cut fossil fuel production by 40% from the 2019 levels. Moreover, to achieve its environment targets, it plans to boost investments in non-hydrocarbon businesses over time. Additionally, BP intends to stop corporate reputation advertising and divert spending toward the promotion of carbon-reduction policies. Last year, Norway’s Equinor ( EQNR Quick Quote EQNR - Free Report) also set its strategy to enhance its transformation into a net-zero carbon emitter. EQNR plans to reduce net carbon intensity by 20% within 2030 and 40% by 2035 while investing more in renewables and low-carbon solutions. Equinor announced a long-term renewable energy target of reaching 12-16 gigawatt of installed capacity by 2030. It aims to store 15-30 million metric tons of carbon dioxide per year and offer clean hydrogen in 3-5 industrial clusters by 2035. EQNR intends to invest about $23 billion in renewables between 2021 and 2026. Wrapping Up A significant number of oil companies publicly set net-zero environmental pledges by 2050, many within the last few months. A big reason for such urgency is the market’s growing recognition of corporate ESG credentials. There is no doubt that the Oil/Energy space stepped up efforts toward a decarbonization goal. Nonetheless, this evolution involves a monumental shift in the energy sector’s business model by effectively departing from the primary operations of oil and gas development. While some of the transition strategies are indeed ambitious, what’s clear is that companies with a strong ESG bent are held in high regard by the public that might ultimately boost the stock prices.