Improving methane disclosure in the oil and gas industry
Voluntary reporting on methane emissions by the oil and gas industry is poor — less than a third of reviewed companies report emissions and zero companies disclose emissions reduction targets making it challenging for investors to effectively gauge materiality, assess performance and manage risk.
Methane, the primary component of natural gas, is a climate pollutant 84 times more powerful than carbon dioxide over a 20 year period, and it is responsible for a quarter of the warming we are experiencing today.
- Emissions from the oil and natural gas industry represent the largest industrial source of methane emissions, both
in the United States and globally.
- Methane emissions undermine the value proposition of natural gas for delivering cleaner, low-cost energy, and have drawn increasing scrutiny from the public, environmental and health groups, and state and federal policymakers. Additionally, methane emissions represent wasted saleable product, with implications for operational efficiency and the bottom line.
Unfortunately, reporting of methane emissions by the industry is lacking, making it challenging for investors to effectively understand the materiality of the problem, assess performance and manage risk.
This report has three purposes:
- to educate oil and gas investors on the importance of methane emissions,
- to examine and document the current state of reporting on methane in the U.S. oil and gas sector and
- to provide recommendations to improve the amount, quality, and accuracy of methane emissions data