Net Zero was someone else’s problem. Not anymore.

RSM's Net Zero Report on the resources sector examines how net zero expectations are increasingly influencing operational and commercial decisions across mining, oil and gas, and the extended value chain that supports them, including contractors. 

While the need to decarbonise is not in dispute, current targets are not always aligned with technological readiness, infrastructure constraints and the structural realities that shape what the sector can realistically deliver.  

Net zero planning frequently points to efficiency improvements, electrification and alternative fuels; however, many operations face practical constraints that limit the feasibility of these pathways in the near term. The barriers are driven less by intent than by access to reliable power, infrastructure availability, capital requirements and site-specific operating conditions, particularly in remote and mobile environments. As a result, progress is often incremental, with emissions targets translating into cost and reporting considerations rather than immediate changes to operating models. 

The driller's exemption is over 

For drilling businesses, the relevance of net zero has traditionally been less direct. The operational profile of the industry, mobile, diesel-reliant equipment operating across remote sites under short-term contracts and within infrastructure constraints largely outside a contractor's control, has insulated drillers from the bulk of the regulatory pressure. That dynamic is now changing. Although drillers may not be directly regulated or required to set emissions targets, the effects of the transition are already emerging in subtle but tangible ways through procurement, operating expectations and commercial arrangements. 

Procurement does the regulating

Mining, oil and gas companies are increasingly committing to emissions reduction targets, with many already obligated under the Safeguard Mechanism (established under the National Greenhouse and Energy Reporting framework). These commitments are influencing procurement approaches, contractor management practices and information expectations.

Drilling contractors may face growing expectations to demonstrate awareness of emissions performance, fuel efficiency and broader alignment with decarbonisation objectives. While responsibility for site infrastructure and energy supply typically remains with the owner-operator, contractors are often expected to operate within client-defined parameters. Over time, this can create commercial pressure to adapt operating practices or justify the continued use of diesel-intensive  
 equipment, even where alternatives are limited or not yet technically or economically viable.

These value-chain dynamics also flow into emissions reporting. Mining, oil and gas companies face heightened expectations around disclosure, including Scope 3 emissions, which capture indirect emissions across the value chain. As a result, drilling contractors are likely to face frequent requests for fuel consumption data, greenhouse gas estimates and operational metrics linked to carbon performance. While these requests are typically driven by customer reporting obligations rather than direct regulation, they may influence tender outcomes, contract renewals and preferred-supplier status. 

Incremental, not wholesale

A second area of impact relates to the gradual shift toward electrification and lower-emissions technologies. Decarbonisation in drilling is being approached through incremental change rather than wholesale transformation. Emerging technologies include hybrid power systems combining diesel generators with battery storage, electrified rigs where suitable power access exists, and on-site integration of renewable energy where conditions allow. Battery systems can smooth peak loads and improve generator efficiency, while automation and data-driven optimisation can reduce unnecessary fuel consumption. These technologies are not universally applicable, particularly for remote, short-duration or exploration-stage projects. 

Capital follows the climate

Capital allocation is also shifting. As banks, insurers and investors integrate climate considerations into their lending and investment frameworks, mining, oil and gas companies may encounter tighter financing conditions for certain projects or   activities. These dynamics extend indirectly to drilling contractors, shaping project pipelines, contract duration, equipment expectations and risk appetite across the contracting market. Drilling fleets are typically long-lived and capital-intensive, and shifts in client preference toward newer or lower-emissions equipment may influence future investment decisions, residual values and fleet composition.

The upside

There are opportunities here. Real-time drilling monitoring and AI-driven analytics can improve penetration rates and reduce emissions intensity. Fleet electrification, targeted R&D and collaboration with technology providers add further upside. One example is Novamera's Sustainable Mining by Drilling (SMD) approach, which uses intelligent sensing and precision excavation to selectively extract ore while leaving waste rock in situ. Contractors that understand how mining-led net zero initiatives intersect with their operating model, and factor these risks and opportunities into strategic planning, will be better positioned to navigate the transition. 

Read RSM's Net Zero Report.

How RSM can help

We welcome you to reach out to Jacob Elkhishin or the broader RSM ESG & Climates Services team for a confidential discussion. This article was featured in Australasian Drilling Magazine, p. 112, June-July Edition 2026