||Withdrawn in response to corporate commitments
REPORT ON METHANE EMISSIONS MANAGEMENT
We believe that reporting on environmental risk management increases company responsiveness to shareholders who are seeking information about the company’s response to current and evolving regulation, as well as to increasing public awareness of how corporate behavior can impact the environment.
Companies in the oil and gas industry face multiple types of risk from emissions of methane gas from their operations, including environmental and reputational risk. According to the Environmental Protection Agency, the oil and gas sector in the U.S. is the largest industrial source of methane emissions, contributing to 31% of U.S. methane emissions.
Methane gas emissions are a significant contributor to climate change. According to the Environmental Defense Fund, methane is a climate pollutant 84 times more powerful than carbon dioxide over a 20 year period and is responsible for one quarter of today’s global warming.
The International Energy Agency has identified minimizing methane emissions from upstream oil and gas production as one of four key global greenhouse gas mitigation opportunities to keep the world below a 2° Celsius temperature increase.
Because of their potency, unmanaged emissions of methane can undermine the positive environmental profile of natural gas and therefore harm its ability to play a positive role in solving climate change. Consequently, methane emissions can damage the product reputation of natural gas as a cleaner-burning fuel. This has negative long-term implications for demand, particularly when considering the growing competition from renewable energy.
Low-cost solutions to achieve methane emission reductions exist, including leak detection and repair technologies (LDAR). The World Energy Outlook 2017 analysis finds reduction potentials globally of 75%, with 40-50% of this reduction at net zero costs. The reduction of oil and gas methane emissions remains a cost-efficient way of reducing greenhouse gas emissions.
We believe a strong program of measurement, mitigation, target-setting, and disclosure supports continued market share, maximizes gas for sale, preserves natural gas’ favorable environmental profile, and bolsters shareholder value.
Energen Corporation has not provided adequate disclosure in public filings, on its website, or through a report, of the Company’s strategies to mitigate risk associated with the emission of methane gas from its operations.
RESOLVED: Shareholders request Energen Corporation issue a report (by September 2018, at reasonable cost, omitting proprietary information) that reviews the Company’s policies, actions and plans related to methane emissions management, including efforts to: measure, monitor, mitigate, disclose, utilize leak detection and repair (LDAR) technologies (including frequency, scope, and methodology), and set quantitative reduction targets for methane emissions resulting from aggregate operations under the Company’s financial or operational control.
SUPPORTING STATEMENT: We believe the report should include the leakage rate as a percentage of production, throughput, and or stored gas; management of high risk infrastructure; best practices; worst performing assets; environmental impact; reduction targets and methods to track progress over time.