Webinar Highlights Importance of Responsible Natural Gas Development
The increasing importance of corporate responsibility and sustainability in the natural gas industry was at the forefront of the Center for Energy Policy and Management’s recent webinar on ESG – or environmental, social and governance goals.
Yemi Akinkugbe, chief excellence officer for CNX Resources Corp., and Will Jordan, general counsel and executive vice president for EQT Corp., the largest natural gas producer in the nation, explained the ways their companies are moving beyond the balance sheet to recognize goals in the areas of the environment, safety, diversity, and community involvement.
Mason Gregory, a senior analyst for MFS Investment Management, explained the role that ESG is now playing in investment decisions for many banks, investment groups, and corporations.
“Much of the value in companies is in intangible assets,” he said, such as brand value and intellectual property. Companies with reputational risks tend to be less resilient, and “there is a lot more volatility in the market due to negative ESG events.”
Climate change is the ESG factor that has dominated, he said, and companies have to adapt their operations to become more sustainable.
His statements were echoed by both Jordan and Akinkugbe, who said their companies have been upfront about their goals by publishing corporate responsibility reports on their websites that outline the changes taking place.
Jordan, who is also the chair of EQT’s ESG committee, said there has been an evolution in the industry moving away from a “singular profit standpoint” to one that recognizes all stakeholders.
“In the last two years the dynamism in the energy space has exploded” as companies wrestle with what energy will look like in a low-carbon future, while nations move to reduce or eliminate greenhouse gas emissions.
“The elephant in the room for the natural gas industry is the emissions focus and debate around the energy mix of the future,” he continued.
Both he and Akinkugbe think that natural gas will continue to play a prominent role in that mix, pointing to the continuing transition from coal to natural gas for energy generation, which has resulted in a significant reduction in GHG emissions.
“We believe natural gas will continue to be a valuable part of the portfolio of energy,” Akinkugbe said.
“It’s not going to be a world where all our power is provided by renewables,” Jordan argued, citing a lack of scale and the blackouts last summer in California. He believes that natural gas companies need to “show we have a clean house,” by doing everything possible to reduce their footprint.
Jordan also noted that not all natural gas is created equal, as companies operating in the Marcellus are responsible for 16 percent of the nation’s gas production, yet produce just 4 percent of the emissions. He believes more Appalachian gas should be a priority.
Akinkugbe noted that CNX is a locally based company with a 156-year history in the area. “Because we are so local, because we live where we work, we have multiple eyes on us,” he said, and the company takes environmental stewardship and community involvement very seriously.
“The industry as a whole has come alive to recognizing this principle,” he continued. “If one violates the trust of the people, it affects us all.”