Energy Exchange

Big bright spot in a disappointing season for shareholder climate resolutions

By Andrew Howell, CFA

It’s annual general meeting season in the U.S. — when shareholders hold companies to account and press management to do better.

A record 71 climate-related resolutions will be presented this year at public companies, more than double the number last year. But with a more ambitious suite of resolutions, fewer are being approved: just 21% of climate resolutions have passed so far this year, compared with 33% last year.

So it is big news that yesterday brought the passage of the first two climate resolutions in the oil and gas sector at ExxonMobil and Chevron. And while the successful Exxon resolution, requiring reporting on the financial impacts of a net zero by 2050 world, received more attention, the Chevron resolution is equally noteworthy. Chevron’s shareholders voted overwhelmingly in favor of a resolution filed by Mercy Investment Services pushing the company to improve its reporting on methane emissions.

Methane is a critically important issue to mitigate climate emissions and improve energy security. Having reliable, quality data is the key to rapidly address both imperatives now.

The Chevron methane resolution was backed by a whopping 98% of shareholders and was supported by the company’s board — likely the first time a climate resolution has achieved this status.

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Also posted in Methane, Natural Gas / Language: / Comments are closed

Differentiated gas: Nothing but hot air without these five criteria

By Dan Grossman and Maureen Lackner

Getting a comprehensive and accurate picture of the extent of methane emissions from the oil and gas industry is hard.

Our scientists have spent much of the last decade detailing deficiencies and inaccuracies in the way companies — and even regulators — estimate emissions, which result in dangerous understatements of the methane problem.

And that is precisely why efforts by oil and gas companies and their consultants to differentiate some natural gas as “responsibly sourced” or “low emission” is problematic.

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Also posted in Methane, Natural Gas / Language: / Comments are closed

New Rystad cost analysis makes case for EPA to end routine flaring in final methane rule

By Jon Goldstein and Grace Weatherall

Reducing the amount of methane emitted from oil and gas infrastructure is among the cheapest and simplest solutions we have to reduce global warming quickly while protecting public health. The Environmental Protection Agency is in the midst of developing rules to curb these emissions from oil and gas producers across the country.

A new analysis commissioned by EDF and conducted by Rystad Energy makes it clear that eliminating routine flaring — a major source of rogue emissions — should be part of EPA’s methane rulemaking.

Though there are valid safety reasons for some minimal flaring, most of it occurs via routine flaring — when oil producers simply don’t have a place to put the natural gas that emerges from the ground during oil production and simply burn it off. More than $1 billion of natural gas is wasted at flares every year, driving unnecessary and harmful climate and local air pollution — including methane, an extremely potent greenhouse gas — when natural gas is not fully burned.

Rystad’s report includes two key findings that should inform EPA’s rulemaking.

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Also posted in Air Quality, Colorado, Methane, Natural Gas, New Mexico, Texas / Language: / Comments are closed

Round one of EPA methane comment period draws record engagement; Here’s how companies and investors can step up in round two

The public comment period for the Environmental Protection Agency’s proposed oil and gas methane rules generated more than 400,000 individual submissions, including many from energy and financial companies that support Biden administration efforts to reduce emissions of this powerful greenhouse gas.

However, our analysis of comments from energy and investment companies shows a troubling divide between those that support strong rules and others trying actively to weaken them before they even take effect. When EPA’s next comment period opens this spring, it will be critical for supporters to weigh in on the overall goal, as well as on specific provisions — including elimination of routine flaring, transitioning away from polluting pneumatic equipment, and ensuring comprehensive leak detection, including at smaller wells.

A broad collection of investors representing trillions of dollars in capital has urged oil and gas companies to demonstrate genuine effort to reduce their emissions. Yet despite increasing numbers of targets from industry in recent years, U.S. methane emissions remain sky high — suggesting voluntary efforts will not be enough to meet this challenge.

If responsible operators already taking action do not take advantage of this unique policy opportunity, the worst actors will continue to bring down the reputation of the industry as a whole for years to come.

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Also posted in Methane, Natural Gas / Language: / Comments are closed

To tackle natural gas waste on federal and tribal lands, the Biden administration must end routine venting and flaring

By Jon Goldstein and Ben Tettlebaum

With responsibility over one-eighth of the nation’s landmass, the Bureau of Land Management has a lot of important jobs. Chief among them is ensuring federal and tribal lands — and the minerals beneath them — are wisely and responsibly managed on behalf of the public, including U.S. taxpayers and tribal citizens.

But avoidable venting and flaring of natural gas from these lands emit harmful pollutants that have significant public health impacts, especially on communities living near oil and gas fields. What’s more, this damaging practice severely exacerbates the climate crisis and, estimates show, wastes $400 million worth of gas every year.

That’s why a broad coalition of 65 environmental, conservation, tribal, business, faith and agricultural groups called on BLM in a letter late last month to follow the lead of states like Alaska, Colorado and New Mexico and ban routine venting and flaring of natural gas.

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Also posted in BLM Methane, Methane, Natural Gas, New Mexico, Wyoming / Language: / Comments are closed

Methane policy is a test of investors’ post-COP climate commitment. Will they pass?

Climate pledges and statements of support from the financial industry ring hollow unless and until firms support public policies that will deliver required emission cuts. That’s at risk of happening now as major asset managers have remained silent on a proposed new Environmental Protection Agency rule requiring oil and gas producers to cut their methane emissions.

Now is the time for investors to speak up. By backing the regulation, the financial sector has a crucial, cost-effective opportunity to support the mitigation of short-term climate risk from a dangerous climate pollutant. The EPA comment period for the proposed methane regulations lasts until Jan. 31, 2022, and is the perfect venue for investors to voice their support.

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Also posted in Methane / Language: / Comments are closed