Risk response

Our Climate Change Action Plan addresses the significant and high risks from our SD Risk Register and includes milestones over several years. Actions within the plan address individual risks identified by our business units or global/regional risks identified by our central corporate staff. For example, some chronic and physical climate-related impacts are more likely to apply to a single business unit, given the specific local nature of the risk and geographical location of our assets. 

Climate Change Action Plan

Risk Topics Mitigation Actions and Milestones
Climate-related policy
Climate change policy, including carbon taxes
  • Review global emerging issues with the SPEC on a regular basis. 
  • Work with Climate Leadership Council and API Climate Working Group to develop U.S. carbon tax framework; advocate for a carbon price through the Climate Leadership Council/Americans for Carbon Dividends as well as the Carbon Pricing Leadership Coalition. 
  • Directly engage governments on evolving climate policy and monitor policy developments. 
  • Engage in industry working groups to provide input to federal consultation on border carbon adjustment policies. 
  • Use carbon price in base case long-range planning and forecasting; maintain GHG forecasting practice. 
  • Support effective incentives for emissions reductions, including tax and production credits and protocols for use of carbon credits and offsets. 
  • Maintain global corporate position and strategy on carbon offsets purchases and advocate for the long-term use of carbon offsets, including market convergence. 

Climate disclosure policy 
  • Conduct regulatory reporting gap assessment to plan for new regulatory disclosures.  
  • Conduct assurance and internal audit for all sections of annual Sustainability Report and enhance processes and controls. 
  • Implement strategy for environmental data management.
Low carbon technologies activities 
  • Explore novel technology and investments through Low Carbon Technologies organization. 
  • Explore implementing CCS technology in project design. 
  • Explore development of hydrogen/ammonia project as low carbon power generation fuel. 
  • Consider partnering with future renewable energy project developers to power our operations where operationally and economically feasible and monitor new opportunities. 
Emissions and emissions management
GHG emissions regulations
  • Support enactment of cost-effective federal methane regulations on new and existing sources that would preserve a state’s ability to adapt implementation to local conditions. 
  • Explore new technology solutions and facility improvements to meet methane and flaring reduction targets. 
  • Continue regulatory advocacy efforts around methane and flaring. 
  • Work with industry trade groups and task forces to respond to proposed GHG regulations. 
GHG emissions reductions
  • Design and develop new facilities with lower emission footprints. Focus on operational efficiency globally to reduce GHG intensity. 
  • Execute U.S. flare reduction plans and consider developing additional flaring reduction targets. 
  • Continue implementation of corporate Climate Risk Strategy including energy transition plan with updated targets. Continue integration of business unit emissions reduction approaches. 
  • Improve GHG data collection efforts and advance MACC emissions reduction projects, plans and low-carbon ideas. Continue to assess transformational technology pilots. 
  • Continue to grow emissions monitoring program. Advance methane mitigation measures through leak detection surveys, source testing and tank monitoring. 
  • Participate in OGMP 2.0 to advance methane reporting to Level 5 Gold Standard reporting. 
  • Include energy transition milestones in short-term incentive plan (VCIP) to add accountability to reducing our GHG emissions intensity. 
  • Increase internal engagement on electricity load forecasting and grid power needs across the company to manage electricity-related planning. 
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Physical climate-related impacts
Acute and chronic physical risks Assessment
  • Continue to include physical climate risk in SD risk management process.
  • Develop global physical risk assessment guidelines for business units and continue with ongoing review cycle.
  • Initiate asset-specific climate risk assessments.
Fresh water constraints
  • Increasing use of recycled produced water and produced water infrastructure planning and collaboration.
  • Progressing research to develop and pilot technologies and processes to treat produced water for potential beneficial reuse opportunities beyond the oil and gas industry.
Permafrost thaw
  • Continue assessment of risk of permafrost thaw for construction of new infrastructure and implementation of mitigation measures.
  • Investigate effective approaches for monitoring permafrost.
  • Continually review and update engineering and design specifications, including equipment and site maintenance.
Wildfire
  • Participate in desktop regional wildfire annual risk assessment and mitigation planning efforts.
  • Execute emergency response plan exercises, drills and training for wildfire threats.
  • Engage with local forestry industry on integrated land management plan.
  • Implement and execute safety barriers and controls to enable facility and personnel protection in the case of fire and advance warning of potential wildfire threats.
  • Distribute wildfire daily update to relevant stakeholders.

 

Our position

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Responding to climate-related risks

Our SD risk management process ensures that a Climate Change Action Plan is developed to track mitigation activities for responding to significant and high climate-related risk included in the corporate SD Risk Register. This plan includes details about our commitments, related responsibilities, resources and milestones over several years.  

Actions within the plan address individual risks identified by our business units or global/regional risks identified by our central corporate staff. For example, some chronic and physical climate-related impacts are more likely to apply to a single business unit, given the specific local nature of the risk and geographical location of our assets.

As part of annual updates to the register, we evaluate the action plan and its effectiveness and make decisions to continue mitigation measures, add new measures or simply monitor the risk for further developments.

Read more about our Risk Management Process.

Climate change action plan

Risk topics

Mitigation actions and milestones

Climate change policy, including carbon taxes

Review global emerging issues with the SPEC on a regular basis.

Work with Climate Leadership Council and API Climate Working Group to develop U.S. carbon tax framework; advocate for a carbon price through the Climate Leadership Council/Americans for Carbon Dividends as well as the Carbon Pricing Leadership Coalition. Engage in industry working groups to provide input to federal consultation on border carbon adjustment policies.

Directly engage governments on evolving climate policy and monitor policy developments.

Use carbon price in base case long-range planning and forecasting; maintain GHG forecasting practice.

Support effective incentives for emissions reductions, including tax and production credits and protocols for use of carbon credits and offsets.

Maintain strategy to develop a diversified portfolio of offsets and monitor market convergence.

GHG emissions regulations

Continue regulatory advocacy efforts around methane and flaring, and support enactment of cost-effective federal methane regulations on new and existing sources that would preserve a state’s ability to adapt implementation to local conditions.

Explore new technology solutions and facility improvements to meet methane and flaring reduction targets.

Work with industry trade groups and task forces to respond to proposed GHG regulations.

Determine European Union Methane Rule requirements for global oil, natural gas, and LNG markets. Create compliance plan and methodology guidelines, and pilot a model to validate emission estimates.

GHG emissions reductions and business opportunities

  • Overall GHG

Design and develop new facilities with lower emission footprints. Focus on operational efficiency globally to reduce GHG intensity.

Continue implementation of corporate Climate Risk Strategy and continue integration of BU emissions reduction approaches.

Improve GHG data collection efforts and advance MACC emissions reduction projects. Continue to assess transformational technology pilots.

  • Methane and flaring

Continue to grow emissions monitoring program while prioritizing emissions abatement.

Participate in OGMP 2.0 and continue reporting methane at Level 5 Gold Standard reporting.

Execute U.S. flare reduction plans and consider developing additional flaring reduction targets.

  • Electrification

Increase internal engagement on electrical and grid power needs across the company to manage electricity-related planning, including power availability and constraints in well selection.

Evaluate geographic-based power profiles to optimize infrastructure strategy, such as substation expansions and new construction.

Engage with industry and legislative regulatory groups to communicate anticipated grid needs.

  • Technologies

Explore carbon mitigation pathways through novel technology and investments, led by our Low Carbon Technologies organization.

Consider partnering with future zero-carbon energy project developers to power our operations where operationally and economically feasible and monitor new opportunities.

Acute and chronic physical risks

Assessment

Continue to include physical climate risk in SD risk management process.

Develop global physical risk assessment guidelines for BUs and continue with ongoing review cycle.

Implement guidelines to asset-specific climate risk assessments.

Fresh water constraints

Building infrastructure to increase water storage and supply.

Conducting streamflow forecasting and monitoring, including influence of temperature on flow.

Permafrost thaw

Continue assessment of risk of permafrost thaw for construction of new infrastructure and implementation of mitigation measures.

Investigate effective approaches for monitoring permafrost.

Continually review and update engineering and design specifications, including equipment and site maintenance.

Wildfire

Participate in desktop regional wildfire annual risk assessment and mitigation planning efforts and execute emergency response plan exercises, drills and training for wildfire threats.

Implement and execute safety barriers and controls to enable facility and personnel protection in the case of fire and advance warning of potential wildfire threats.