Verdantix Oil And Gas Sector Benchmark Highlights Substantial Variations In GHG Data Disclosures And Minimal Commitment To Reductions

LONDON--(BUSINESS WIRE)--The world’s largest oil and gas majors should develop and implement an industry framework for greenhouse gas (GHG) data collection, disclosures, accounting, assurance and target setting, according to a new report from independent analyst firm Verdantix. Based on an assessment of 50 characteristics of the GHG strategies of BP, Chevron, Conoco Philips, Eni, Exxon Mobil, Gazprom, LUKOIL, Petrobras, PetroChina, Saudi Aramco, Shell, Sinopec, Statoil and Total, the benchmark finds massive variations in GHG data disclosures, metrics and reduction plans.

“Oil and gas majors that shape industry thinking have not yet created a standard framework for GHG management”

“Oil and gas majors that shape industry thinking have not yet created a standard framework for GHG management” commented Will Mullins, Verdantix Analyst and report author. “A leading group composed of BP, Chevron, Concoco Philips, Exxon Mobil, Shell and Total has invested in people, processes and technology to disclose accurate GHG emissions data across scopes 1, 2 and 3 for their global operations. But other global players in the oil and gas sector such as LUKOIL, PetroChina, Saudi Aramco and Sinopec disclose very little GHG data. Eni, Gazprom, Petrobras and Statoil have started on their GHG emissions disclosure journey but have further to go.”

The 10 firms in the benchmark that disclose emissions, scope 1, 2 and 3, accounted for 4.3 billion tonnes of CO2e, the equivalent of 64% of total US GHG emissions (6.8 billion) in the same period. The Verdantix report, Carbon Strategy Benchmark: Oil & Gas Sector, exposes wide variations in target setting:

• Only Chevron, Eni, Exxon Mobil, Shell and Total disclose reduction targets and none of these targets apply to 100% of total GHG emissions for the 2011 period.
• None of the 14 oil and gas firms in the study use the same baseline year for calculating GHG reduction targets – and only five have set a baseline year.
• Absolute GHG reduction targets apply to only a subset of total emissions – most frequently reducing flaring – which implies there are no targets to reduce total GHG emissions.
• Reduction targets, where they exist, have often lapsed with end dates set in the past, and no new targets being disclosed with end dates in the future.
• Only Eni and Statoil have set carbon intensity targets despite this being a standard metric for improving industrial processes in the EU Emissions Trading System.

“Oil and gas majors should adopt industry frameworks for GHG management developed by trade associations like the IPIECA. Laggards can learn from the more mature strategies of firms like Chevron, Exxon Mobil and Shell” commented David Metcalfe, Verdantix CEO. “Technology for GHG data collection, reporting and analysis is ready to go. Five firms in the benchmark use the energy and emissions management software platform from IHS and one has deployed Enablon’s software. Ten of the oil and gas majors invest in assurance of their data with independent third parties, primarily with Ernst & Young but also with KPMG and LRQA. Only mandatory reporting rules will put sufficient pressure on oil and gas majors to measure and disclose global GHG emissions. In geographies outside of Australia, Europe and the US that still looks like a distant threat.”

Note To Editors

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