After Investor Pressure, Continental Resources Sets Strong Goal to Reduce Natural Gas Flaring
BOSTON, March 1, 2013 /3BL Media/ – Continental Resources, Inc., the largest oil producers in North Dakota’s Bakken region, has committed to reduce natural gas flaring from its operated well sites to “as close to zero percent flaring as possible.”
This goal announced in Continental’s annual 10-K report follows a shareholder resolution filed by Mercy Investment Services requesting that the firm “adopt quantitative, company-wide goals, based on current technologies, for reducing or eliminating flaring in all operations and facilities under the company’s financial or operational control.”
The resolution was withdrawn in early 2013 after productive dialogue between Continental Resources and its investors.
“While our concerns over the environmental impacts of unconventional oil and gas development remain, we see Continental’s increasing disclosure and goal-setting as a clear step in the right direction,” said Pat Zerega, director of shareholder advocacy at Mercy Investment Services, the lead filer of the flaring resolution. “Continental’s strong goal shows that there is agreement between the domestic oil industry, investors and advocates that allowing billions of cubic feet of natural gas to go up in flames is not good for business.”
In its 10-K filings, Continental reported that it had met an internal goal to reduce flaring of natural gas from its North Dakota wells by 50 percent between December 2011 and December 2012. “During December 2012, the percentage of our natural gas production flared in North Dakota Bakken was approximately 10 percent,” the company reported, “compared to approximately 20 percent in December 2011.”
Continental also noted that the percentage of gas it flares is significantly less than that of its industry peers in the Bakken play. “According to data published by the North Dakota Industrial Commission, our industry as a whole was flaring approximately 33 percent of produced natural gas volumes in the state as of late 2012,” Continental reported.
“Continental’s announcement shows that it is possible to reduce flaring, and to do so quickly. The company’s leadership underscores how poorly the rest of the industry in the Bakken is performing,” said Andrew Logan, director of the oil and gas program at Ceres. “Continental’s goal should serve as an example to its peers in the industry and to regulators and legislators who are working to limit flaring in North Dakota and across the nation.”
As U.S. oil production has grown rapidly, flaring volumes have increased along with production in the Bakken. According to the North Dakota Industrial Commission (NDIC), the number of producing oil wells grew 27 percent between December 2011 and December 2012. And in the NDIC’s most recent report on oil production, the Commission noted that while “the high liquids content makes gathering and processing of Bakken gas economic,” nearly 30 percent of this gas continues to be flared. The state reported a new all-time high in natural gas production at 805,705 million cubic feet per day.
In March 2012, Mercy Investment Services and other investors representing $500 billion in assets sent a letter to 21 of the industry’s largest shale oil producers, including Continental, urging them to reduce or eliminate flaring. The signatories of the letter included F&C Asset Management, Boston Common Asset Management, Local Authority Pension Fund Forum, PaxWorld Management, Portfolio 21 Investments and Presbyterian Church (USA), among others.
For more information:
Peyton Fleming, 617-733-6660, firstname.lastname@example.org
Ceres is an advocate for sustainability leadership. Ceres mobilizes a powerful coalition of investors, companies and public interest groups to accelerate and expand the adoption of sustainable business practices and solutions to build a healthy global economy. Ceres also directs the Investor Network on Climate Risk (INCR), a network of 100 institutional investors with collective assets totaling more than $11 trillion.
For more information, visit http://www.ceres.org