Case study: How Southwestern Energy reduces methane emissions
As an independent energy company engaged in natural gas and crude oil exploration, development, production, gathering and marketing, Southwestern Energy (SWN) is proactively addressing methane emissions through several voluntary efforts Tweet This!, as excessive methane leakage can partly offset the benefits of natural gas as a lower-carbon fossil fuel.
This case study is based on the 2015–16 Corporate Responsibility Report by Southwestern Energy published on the Global Reporting Initiative Sustainability Disclosure Database that can be found at this link. Through all case studies we aim to demonstrate what CSR/ ESG/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.
Abstract
Abstract
Methane is the primary component of natural gas and a short-lived, high-global-warming potential greenhouse gas (GHG) when emitted. Addressing methane emissions is, thus, a top priority for SWN. In order to reduce methane emissions SWN took action to:
- implement a leak detection and repair programme
- evaluate new and emerging methane emission-detection technologies
- collaborate to reduce methane emissions across the natural gas value chain
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With this case study you will see:
- Which are the most important impacts (material issues) SWN has identified;
- How SWN proceeded with stakeholder engagement, and
- What actions were taken by SWN to reduce methane emissions
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What are the material issues the company has identified?
In its 2015–16 Corporate Responsibility Report SWN identified a range of material issues, such as risk management, safe working conditions and training, proactive community engagement, company financial health, water quality, sourcing and wastewater management. Among these, reducing methane emissions stands out as a key material issue for SWN.
Stakeholder engagement in accordance with the GRI Standards
The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:
Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.
Key stakeholder groups SWN engages with:
| Stakeholder Group | Method of engagement |
| Investors
| · Financial reports and teleconferences (annually and quarterly) · Meetings with institutional investors (more than 850 in 2015) · Direct contact with Board members · Investor conferences and bus tours (54 in 2015) · Additional regular contact through SWN’s Investor Relations function |
| Employees
| · SWNet (internal internet) · Town-hall style meetings (quarterly by division, and quarterly with SWN’s CEO) · Support and networking groups · Safety training · Performance management · Connection (triennial employee newsletter) · Surveys · Leadership and professional development programs · Ethics hotline · Day-to-day interactions |
| Contractors
| · Safety Stand Down days and safety training · Project meetings at SWN sites to address specific HSE issues and corrective actions · Operational reviews by division management · Vendor forums and audits · SWNlink communications, including operational announcements and quarterly newsletters |
| Customers
| · Regular contact through SWN’s Marketing group |
| Landowners and Holders of Mineral Rights
| · Direct, individual conversations and negotiations · Monthly payment statements to royalty owners · Biannual newsletters · Landowner hotline |
| Local Communities (including residents, elected officials, community groups, chambers of commerce, emergency responders) | · Regular contact via SWN community liaisons · Everyday Heroes events (annually in Southwestern Energy’s operating areas) · Employee volunteerism (typically monthly) · Safety Stand Down days and safety training · Hotlines to field concerns and questions · Fundraisers and charitable giving · Crisis drills (annually) |
| State- and Federal-Level Government Officials | · Open and direct communications · Educational sessions · Legislative and regulatory engagement |
| Environmental Organisations and Universities
| · Participation in and funding of specific partnership projects · Joint research projects · Resources for technical assistance · Direct communication with relevant SWN employees |
How stakeholder engagement was made to identify material issues
To identify and prioritise material topics SWN interviewed stakeholders and reviewed documents representing stakeholders’ views, including employees, suppliers, investors, regulators, local communities and nongovernmental organisations.
What actions were taken by SWN to reduce methane emissions?
In its 2015–16 Corporate Responsibility Report SWN reports that it took the following actions for reducing methane emissions:
- Implementing a leak detection and repair programme
- SWN applies a company-wide leak detection and repair (LDAR) programme, which includes annual instrument surveys, leak detection surveys, leak repairs, re-surveys and recordkeeping sufficient to track and trend leaks. In 2015, SWN acquired Bacharach Hi-Flow measurement devices and was able to quantify the emissions detected. In addition, SWN staff carried out instrument leak detection surveys on approximately 88 per cent of SWN’s total well count and 85 per cent of its Midstream-operated compressor stations. Leaks were identified and repaired, and midstream operations achieved a 60 per cent decrease in total leak observations from 2014 to 2015.
- Evaluating new and emerging methane emission-detection technologies
- SWN engages in field trials to evaluate new and emerging methane emission-detection technologies (for example, the Picarro Surveyor and Rebellion Photonics Gas Cloud Imaging). Additionally, SWN participates in the Environmental Defense Fund (EDF)’s Methane Detector Challenge and the ARPA-E programme by the U.S. Department of Energy (DOE) to develop low-cost methane sensors, as well as in the Environmental Protection Agency (EPA)’s Natural Gas STAR Program, which encourages companies to voluntarily recover or reduce methane emissions. SWN’s cumulative reported reductions since beginning the programme in 2006, are more than 41.2 billion cubic feet.
- Collaborating to reduce methane emissions across the natural gas value chain
- SWN co-founded the Our Nation’s Energy (ONE) Future coalition, a group of eight companies dedicated to reducing methane emissions across the natural gas value chain. ONE Future’s aim is to reduce, by 2025, emissions to an average annual leak/loss rate of no more than 1 per cent of gross U.S. natural gas production. SWN also joined the Climate and Clean Air Coalition Oil and Gas Methane Partnership (CCACOGMP), an international programme that aims to reduce methane emissions from the oil and gas sector. Programme participants share best practices for controlling and reducing emissions from certain sources.
Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?
The GRI Standard addressed in this case is:
Disclosure 305-5 Reduction of GHG emissions
Disclosure 305-5 Reduction of GHG emissions corresponds to:
- Sustainable Development Goal (SDG) 13: Take urgent action to combat climate change and its impacts
- Business theme: GHG emissions
- Sustainable Development Goal (SDG) 14: Conserve and sustainably use the oceans, seas and marine resources for sustainable development
- Business theme: Ocean acidification
- Sustainable Development Goal (SDG) 15: Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss
- Business theme: Forest degradation
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References:
1) This case study is based on published information by SWN, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original, please revert to the original on the Global Reporting Initiative’s Sustainability Disclosure Database at the link:
http://database.globalreporting.org/
2) http://www.fbrh.co.uk/en/global-reporting-initiative-gri-g4-guidelines-download-page
3) https://g4.globalreporting.org/Pages/default.aspx
4) https://www.globalreporting.org/standards/gri-standards-download-center/
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