Bruce Ofori, Emerson’s Sales Development Manager for ESG, recently published an article in the Mar 2022 edition of Hydrocarbon Processing. It’s titled “Staying Ahead of Environmental, Social, and Governance Goals” and it describes how forward thinking industry leaders are acting now to get ahead of government-mandated environmental, social, and governance requirements. A summary of the article follows.
The concept of only investing in firms that champion environmental, social and governance (ESG) issues has been discussed for decades (Figure 1). But after years of inaction, the idea is finally transitioning to reality as investors and stakeholders are now actively demanding that companies engage in ESG improvements and publicly show their progress.
Figure 1: Activists and investors are increasingly demanding companies to focus on ESG issues, set goals, and show continual progress and improvements.
These demands have been heard at the highest levels, as Bruce explains:
The calls have been so great that the U.S. Security and Exchange Commission (SEC) is creating reporting guidelines so companies can provide consistent and accurate accounts of their ESG programs, alongside their standard financial reports.
With so much public focus on these concepts, strong ESG performance is no longer a differentiator, but simply a requirement for many corporations. Though the standards and guidelines are in flux, proactive companies are already setting and pursuing ESG goals.
ESG in the oil & gas industry
While social and governance issues apply universally, the petrochemical industry is facing significant public pressure to improve their environmental stance by cutting emissions and reducing greenhouse gas generation. They usually accomplish this with a multipronged approach (Figure 2).
Figure 2: Most oil and gas companies pursue a broad variety of methods to reduce greenhouse gas generation and emissions.
The first method pursues low carbon fuels by utilizing recycled and renewable feedstocks, such as soybean oil, corn oil, beef tallow, used cooking oils, rapeseed, and others. In addition, processes are used to collect biogas from agricultural and waste sources and converts them to saleable biomethane.
Further environmental improvements stem from the reduction of methane emissions. Remote oil and gas production areas often use natural gas to operate instruments and valves, venting methane continuously. Also, many valves and pumps leak pollutants through packing and seal leaks. All these emission sources can be curtailed and even eliminated through proper equipment design and upgrades.
In addition, advanced controls tactics and strategies offer numerous ways for processing facilities to improve yields and run more efficiently, reducing waste and emissions even further.
ESG improvements through automation
Like oil and gas companies, automation industry firms are also trying to reduce emissions. Most have focused on internal processes, reducing building energy costs, and improving manufacturing efficiency and cutting waste, but those efforts ignore the best opportunity for ESG improvement, as the author describes:
While all these methods certainly have a positive impact on the environment, the most dramatic environmental improvements come from the development of new instrumentation and controls which enable oil and gas companies to achieve their ESG goals in a more effective and less costly way.
Membrane technology, control systems, and advanced analytics are used to automate and improve hundreds of biomethane processing plants all over the world, converting potential greenhouse gas emissions to market quality natural gas.
New designs in valve actuation allow natural gas-actuated valves to be replaced or inexpensively retrofitted with low and zero emission alternatives. There are also low bleed or very low power electrical alternatives for natural gas-powered instrumentation, with power provided by small local solar systems. The devices not only meet the stringent methane emission regulations for the U.S. and Canada, but they often pay for themselves in a short time.
Bruce suggests the time to act is now:
The demands from shareholders, stakeholders, the SEC, and the public in general for improvements in ESG initiatives are becoming insistent. Rather than wait for new regulations to be issued, most industry leaders are staying ahead of the curve by defining their own goals, tracking progress, and publishing results.
Obviously, the improvements immediately benefit society and the environment, but by proactively pursuing ESG goals, a company is allowed to define its role and choose the best path forward. This is almost always preferable to having governmental entities dictate goals and methods.
All Figures courtesy of Emerson.
About the Author
Bruce Ofori is the Sales Development Manager for ESG at Emerson for their flow controls products. He works with global customers to help them achieve their emission and energy reduction targets. Bruce is a graduate of the Kwame Nkrumah University of Science and Technology in Ghana with a bachelor’s degree in Chemical Engineering, and he obtained his Master’s in Petroleum and Gas Engineering from the University of Salford in Manchester, England.
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