The 7th Environmental Transparency Rating Of Oil And Gas Companies: Focus On Public Control
The transparency degree of each company is assessed according to 30 criteria. The methodology is discussed annually with stakeholders, including company representatives. This year, the assessment of the level of utilization of associated petroleum gas (APG) will be focused not on the industry average figure, but on the normatively fixed indicator of 95%. Previously, such an assessment would have been impossible for most companies, but now organisations are allocating more attention and funds/resources to solving this problem, due to the increase in fines for APG flaring in 2009 among other reasons. This year, the calculation methodology was also supplemented in terms of assessing the waste management level: the indicator will be calculated both with and without taking into account the "legacy". Besides, the rating features a new criterion for assessing the ratio of reclaimed and contaminated land for the reporting period.
“The major oil spill in Taimyr in this May showed the need to enhance environmental precautions,” says Aleksey Knizhnikov, Head of the Program for the Business Environmental Responsibility at WWF-Russia. "Our rating has a number of criteria aimed at reducing the risks of emergencies, including voluntary environmental insurance, the availability of oil spill response (OSR) plans in public space, and public participation as observers in OSR exercises. We hope that this year, taking into account the lessons learnt from the Norilsk emergency, the disclosure of information on these criteria will increase."
The ratings place special emphasis on accidents and incidents at enterprises, as well as on the completeness and timeliness of the information disclosure. When calculating the ratings, maps of emergency and controversial environmental situations are prepared. Since 2019, such data has been collected within the People for Nature project funded by the European Union and aimed at involving the public in environmental protection. The project involved non-profit organizations in the monitoring of environmental incidents. Specialized NGOs from the Khabarovsk Krai, the Amur Region, Yenisey Siberia and Altai conduct public monitoring and analysis of the impact of industrial enterprises, participate in environmental impact audit, and develop and promote the system of public environmental control.
The increased attention to environmental responsibility among Russian oil and gas companies was noted by the CREON Group.
“Green economy, decarbonization and environmental responsibility have become global trends. The investment paradigm has also shifted in their favor. However, in Russia this undoubtedly promising direction will develop in parallel with traditional hydrocarbons”, - believes Fares Kilzie, chairman of the board of directors of CREON Capital. – “The rating has established itself as a tool for objective self-assessment of companies, and we value each of its participants. Now our product is reaching a new level as a tool for assessing the investment attractiveness of oil and gas companies”.
Every year, the successful operation of mining enterprises is increasingly dependent on their level of transparency. This was also recalled by the National Rating Agency, which will calculate the environmental transparency rating of oil and gas companies for the seventh time.
“NRA is committed to supporting sustainable development. This year the Central Bank of Russia approved a renewed list of fringe services for the Agency, including services for assessing the environmental transparency level of companies, ESG rating and assessing the compliance of green bonds with the requirements for green financing,” said Viktor Chetverikov, Managing Director for NRA Development Projects. "Moreover, in July 2020 NRA signed the Principles for Responsible Investment (PRI), supported by the United Nations. One of the most important PRI recommendations to the credit rating agencies is the implementation of ESG factors in credit rating methodologies. Thus, the Agency is eager to follow this recommendations"
In 2019, the Eurasian Environmental Transparency Rating was added to the traditional environmental transparency rating of Russian oil and gas companies, featuring Kazakhstan and Azerbaijan oil and gas enterprises along with Russian companies. The presentation of the results of the Russian and Eurasian Environmental Transparency Ratings of Oil and Gas Companies is scheduled for December 4, 2020 in Moscow.