OilPrice.com - Why Shale Executives Should Jump On The ESG Trend Now

ESG (Environmental, Social, and Corporate Governance), like pretty much everything else in this increasingly partisan world, has become an extremely divisive topic in the business sector. While many think that more socially and environmentally conscious investment and business practices are the best way forward and a central pillar of the future global economy, others dismiss it as leftist and utopian. While some argue that ESG is an inevitable trend (accelerated by the novel coronavirus’ interruption to business as usual), the Trump administration has threatened to make it illegal. A new proposed regulation from the U.S. Department of Labor would expressly prohibit the department from including ESG in any decision-making criteria when it comes to U.S. employer-provided pension funds, in an apparent bid to protect Big Oil.

https://oilprice.com/Energy/Energy-General/Why-Shale-Executives-Should-Jump-On-The-ESG-Trend-Now.html

URTeC 2020: Opening session speakers see industry recovering, but ESG issues loom large

Representing a milestone shift in how the conference projects itself, the virtual URTeC 2020 opened on Monday morning with a fine plenary session on the future for unconventionals, with a growing list of ESG (environmental, societal, governmental) challenges to deal with. While all participants see the E&P industry recovering over the next 18 months, the growing importance of ESG issues will require attention by publicly held companies.

https://www.worldoil.com/news/2020/7/20/urtec-2020-opening-session-speakers-see-industry-recovering-but-esg-issues-loom-large

JPT - Succeeding in the New Pressure Pumping Environment

Pressure pumpers of the future need to overhaul their business models and become efficiency fanatics to succeed in a permanently changed environment, said Energy and Industrial Advisory Partners (EIAP) in its recent The Pressure Pumper of the Future Report.

According to the boutique strategy consulting firm, pressure pumpers faced challenging conditions even before the current industry downturn from decreasing demand, an oversupplied and fractured market, weak frac pricing, and margin erosion from lower pricing and decoupling of sand and chemicals.

The rapid demand destruction from the COVID-19 pandemic and OPEC+ supply increases could not have found pumpers more ill-prepared, said Sean Shafer, EIAP managing partner, as both public and private companies faced balance sheets that were already raising questions about the need for widespread restructurings in the sector.

https://pubs.spe.org/en/jpt/jpt-article-detail/?art=7249

JPT - ESG and Energy Transition: Balancing Value and Values in a Post-Pandemic World

When Shell slashed its dividend by 66% on 30 April, it not only sent shock waves through financial and business communities throughout the world, it “tore up the industry’s financial playbook,” according to Laura Hurst at Bloomberg. Amid the chaos and damage churned up by the pandemic, what had long been unthinkable—the world’s largest supermajors ceasing to defend their dividends at almost any cost, given the importance of payouts to North American investors—suddenly became fact. The last time Shell had slashed its dividend coincided with World War II, nearly 80 years ago. ­Equinor also cut its dividend, and ExxonMobil froze its dividend for the first time in 13 years.

Asked whether the long-held strategy of sacred payouts to shareholders was sustainable in the current situation, Shell Chief Executive Officer Ben van Beurden said, “I would say, no.”

“I think a crisis like this has the potential to catalyze society into a different way of thinking,” van Beurden said.

https://pubs.spe.org/en/jpt/jpt-article-detail/?art=7079