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Southwestern Energy issues ESG goals but no net-zero emissions pledge

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Southwestern Energy issues ESG goals but no net-zero emissions pledge

  • Author Bill Holland
  • Theme Energy

A Southwestern Energy Co. corporate responsibility report promised that the pure-play shale gas producer will continue to reduce methane leakage, but it did not set net-zero or any other emissions targets.

Southwestern's greenhouse gas emissions are already approaching a global climate change target of less than 2 degrees C outlined in the Paris Agreement on climate change, according to projections by S&P Global's Trucost climate risk unit. If Southwestern's emissions follow industry trends, the producer is aligned with global warming between 2 and 3 degrees, Trucost data indicated.

In the Nov. 16 corporate responsibility report, Southwestern said it is in the top 25% of U.S. independent oil and gas exploration and production companies for low greenhouse gas intensity. The company said it plans to invest $15 million to $20 million in unspecified environmental, social and governance issues in 2022.

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President and CEO William Way pledged further efforts to make the company attractive to investors. "Our approach to ESG aligns with our strategic intent to be the preferred investment vehicle for institutional investors looking to gain exposure to responsible natural gas development," Way said in a statement.

The company will seek to have 100% of its Appalachian natural gas production certified by third parties as "responsible natural gas" that meets certain emissions standards.

Southwestern said its methane leakage increased fractionally to 0.075% of production in 2020 because of its $898 million purchase of Appalachian gas producer Montage Resources Corp. in November 2020. Without Montage, Southwestern said its methane leakage would have been 0.059%. With or without Montage, Southwestern's rate is below the 1% leakage rate set by 42-member industry group ONE Future, formed to keep natural gas competitive on an emissions basis.

Trucost compiles emissions profiles using company and government data and projects emissions increases and decreases using mathematical models for industry trends. Trucost's latest update uses 2019 data, the last full year before energy use plunged during the COVID-19 pandemic. Trucost projections only account for Scope 1 and Scope 2 emissions, or emissions from company operations and its supply chain.

Trucost is part of S&P Global Market Intelligence.