Our SD risk management process ensures that a Climate Change Action Plan is developed to track mitigation activities for responding to priority climate-related risks 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 BUs 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 BU, 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 Type |
Mitigation Actions and Milestones |
| Physical Risks |
| Climate change policy, including carbon taxes |
- Review global emerging issues with the Sustainability and Public Policy Executive Council (SPEC) on a regular basis.
- Work with Climate Leadership Council, API Climate Committee and other working groups to advance policies to address end-use emissions that are aligned with our carbon pricing principles.
- 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.
|
| 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.
- Work with industry trade groups and task forces to respond to proposed GHG regulations.
- Monitor phased implementation of European Union Methane Rule requirements for oil, natural gas and LNG markets. Conduct gap assessment in advance of the regulation coming into full effect.
|
| Physical Risks |
| 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-related 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 emissions monitoring program while prioritizing emissions abatement.
- Participate in OGMP 2.0 Methane Partnership to mitigate emissions.
- Explore new technology solutions and facility improvements to meet methane and flaring reduction targets.
- Execute U.S. flare reduction plans.
Electrification
- Continue to engage internally on electrical and grid power needs across the company to manage electricity-related planning, including power availability.
- Evaluate geographic-based power profiles to optimize infrastructure strategy, such as substation expansions and new construction.
- Continue to engage with industry and legislative regulatory groups to communicate anticipated grid needs.
Technologies
- Explore carbon mitigation pathways through novel technology and investments.
- Consider partnering with future zero-carbon energy project developers to power our operations where operationally and economically feasible and monitor new opportunities.
|
| Physical Risks |
| Acute and chronic physical risks |
Assessment
- Continue to include physical climate risk in SD risk management process.
- Develop global physical risk assessment guideline for BUs.
Fresh water constraints
- Build infrastructure to increase water storage and supply.
- Conduct streamflow forecasting and monitoring, including influence of temperature on flow.
Permafrost thaw
- Continue assessment of risk of permafrost thaw for construction of new infrastructure.
- 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.
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