We aim to manage climate-related risk, optimize opportunities and better equip the company to respond to: Evolving investor sentiment, technologies for emissions reduction, alternative energy technologies and uncertainties such as government policies.
The evolving energy landscape requires a strategy that will remain robust across a range of potential future outcomes. Our strategy is comprised of four pillars:
- Objectives: Our framework consists of a hierarchy of objectives — a long-term ambition that sets the direction and aim of the strategy, medium-term performance targets for operational GHG emissions and methane intensity, and near-term targets for flaring and methane intensity reductions that guide implementation of our strategy.
- Technology choices: We continue to enhance our emissions reduction programs in our current operations, while also evaluating new opportunities and technologies that can closely integrate with our global operations, markets and competencies.
- Portfolio choices: We have integrated climate-related risk into our portfolio decision making through consideration of carbon pricing and focusing on low cost of supply, low GHG intensity resources by asset class.
- External engagement: Our stakeholders’ points of view inform the evolution of our climate-related frameworks, actions and public policy.
Progress in these four pillars is demonstrated throughout the following sections. Across the pillars, our strategy takes into consideration transition demand, results from scenario planning, near, medium, and long-term risks and ways to address impacts from those risks.
Related topics
Strategically reducing our emissions in the Lower 48
2022 CDP Report
Progress Report: Operationalizing Our Net-Zero Ambition
The Net-Zero Roadmap: Implementing our Ambition
Building a Technology Toolkit for Methane Emissions Detection
Designing Projects to Reduce Methane Emissions in Canada
Testing Drone Technology to Detect and Quantify Emissions
Creating a Pipeline of GHG Reduction Projects
Optimizing Power Supply to Reduce Emissions
Reducing GHGs While Increasing Production
Sustainability Governance
Catching Thieves in the Oil Sands
Our position
Our Climate Risk Strategy is intended to enable us to responsibly meet the global demand for energy, deliver competitive returns on and of capital and work to meet our previously established emissions-reduction targets. First, meeting global energy demand requires a focus on delivering production that will best compete in any energy mix scenario. This production will be delivered from resources with a competitive cost of supply and low GHG intensity, as well as portfolio diversity by market and asset type. Next, in delivering competitive returns, ConocoPhillips has been a leader in shifting the exploration and production sector’s value proposition away from one focused on production toward one focused on returns. Finally, to drive accountability for the emissions that are within our ownership, we are progressing toward our Scope 1 and Scope 2 emissions intensity targets and we remain committed to our longer-term net-zero ambition..
Key elements of the Climate Risk Strategy include:
Strategic flexibility and portfolio composition
◦Building a resilient asset portfolio with a focus on low cost of supply and low GHG intensity to meet global energy demand.
◦Committing to capital discipline through use of a fully burdened cost of supply, including cost of carbon, as the basis for capital allocation.
◦Testing our portfolio against future energy demand scenarios through a comprehensive scenario planning process that helps us assess the resilience of our corporate strategy to climate risk.
Scope 1 and Scope 2 emissions targets and reductions
◦Setting targets for emissions over which we have ownership and control.
◦Reducing emissions through the marginal abatement cost curve process.
Business opportunities
◦Building an attractive LNG portfolio as an important component of responsibly meeting global energy demand due to LNG's opportunity to displace higher-emissions fuels such as coal for electricity generation.
◦Evaluating potential investments in emerging alternative energy sources and low-carbon technologies.
External engagement
◦Advocating for a well-designed, economy-wide price on carbon and engaging in development of other policy and legislation to address end-use emissions.
◦Working with our suppliers and commercial partners to reduce emissions along the value chain.
Read more about our Climate Change Position, our company Governance, and our approach to net zero.