Talos Energy Inc. further strengthened its ESG commitments on May 27 with the establishment of long-term emissions reductions targets and further linked executive compensation to ESG performance.
“Talos has always had a compelling ESG story with a strong health, safety and environmental track record and solid governance and compensation practices, and we are increasingly committed going forward,” commented Talos President and CEO Timothy S. Duncan in a statement.
Talos is one of the U.S. Gulf of Mexico’s largest public independent producers. The company, based in Houston, has already reduced greenhouse gas (GHG) emissions intensity over the last two years by 20%.
In a May 27 company release, Talos established plans for a 30% further reduction of its GHG emissions intensity by 2025 from the baseline levels established in 2020.
Additionally, the company announced it had increased ESG-driven metrics to account for 20% of management’s annual incentive plan, including key initiatives such as emissions reduction and health and safety metrics. Production metrics were also eliminated and maximum category payouts were reduced to 150% of targets from 200%.
In its release, the company also noted the formal election of Paula R. Glover to the Talos board of directors and appointment to serve on the re-named Safety, Sustainability and Corporate Responsibility Committee. Glover is president of the Alliance to Save Energy, a bipartisan, nonprofit coalition of business, government, environmental and consumer leaders advocating to advance federal energy efficiency policy. She is also a current member of the National Petroleum Council, a federally chartered advisory committee established in 1946 to advise, inform and make recommendations to the U.S. Secretary of Energy.
Talos plans to release its second annual ESG report in the third quarter but disclosed select details regarding its 2020 ESG performance in the May 27 release.
2020 ESG Performance Updates:
- ~20% reduction in GHG emissions intensity from 2018 to 2020 (21.8 to 17.4 metric tons (mt) of CO₂ equivalents / thousand boe).
- ~20% reduction in flaring and venting emissions from 2019 to 2020 (163.5 thousand to 130.6 thousand mt CO₂ equivalents); consistent with Gulf of Mexico operational best practices, Talos continued to have zero routine flaring.
- Highly competitive 0.54 total recordable incident rate; sustained in line with 2019 performance and significantly improved from 2018.
- Less than 3/4 of one barrel of oil released from over 23 million gross operated barrels produced through Talos operated production facilities.
- Continued operational trend of using minimal sourced water for production and completion operations.
- Established employee-led internal ESG committee whose members are actively working on a wide array of initiatives, including emissions reduction, safety, diversity and inclusion, community relations and energy transition initiatives, among others.
- Named a Houston Chronicle Top Workplace in Houston for the eighth consecutive year and increased employee allowances for direct charitable funding initiatives and time away from the office for community volunteering hours.
“As we finalize our 2021 ESG report and reflect on progress made over the past year,” Duncan continued in his statement, “we’re excited about continuous improvement across our business moving forward and the positive impact our employee-led ESG committee is generating towards our efforts.”
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