Climate Strategy and Target
Climate change will have significant potential effects on our operating environment, such as an increase in severe weather events and increases in the rigidity of national and international policies and regulations on climate change.
PTTEP firmly believes that we have a responsibility to both mitigate the risks from climate change and prepare adaptation measures for the changes that are inevitable. Our growing natural gas portfolio serves as a clean energy source. At our operations, we are always exploring new ways to improve energy efficiency and reduce emissions.
PTTEP aims to become a low carbon organization by setting the short-term and medium-term GHG intensity target to reduce and offset at least 20 and 25 percent of our greenhouse gas emissions from 2012 base year by 2020 and 2030, respectively, covering all operating assets and petroleum support bases under our operational control. This target is in compliance with the 2-degrees scenario for energy sector as recommended by the International Energy Agency (IEA).
In addition, recognizing that greenhouse gas emissions come at a cost, PTTEP in collaboration with the PTT Group is launching a campaign to develop an internal carbon price. The internal pricing is a mechanism designed to help guide our investment decisions, especially in projects that may have significant emissions.
We also believe that our climate actions should be accountable and publicly accessible. Every year, we disclose our climate change strategy and performance through the annual report and sustainability report, as well as our participation in the Carbon Disclosure Project (CDP). Our commitment to transparency and leadership in climate action are highlighted by the selection by CDP, which PTTEP has been awarded leadership level for five consecutive years since 2014.
PTTEP has also signed on to the Climate Disclosure Standards Board’s (CDSB) commitment to report climate change in mainstream corporate reports (such as Form 56-1 in Thailand). We are proud to be one the 49 leading companies worldwide to do so.
As a leading Asian E&P company, we understand the importance of collaboration and value our partnerships with other organizations to create positive climate action. We have committed to responsibly engage with third parties on climate policy, consistent with UN Global Compact’s Guide for Responsible Corporate Engagement in Climate Policy. Our partnership with Thailand Greenhouse Gas Organization (TGO) to establish a carbon market in Thailand is an example of our engagement on climate change. In addition, we always seek opportunities to reduce or offset our greenhouse gas emission by e.g. purchasing carbon credits in order to offset the emissions from our internal events and activities and to support the TGO’s carbon credit market, reforestation to promote the carbon dioxide sequestration scheme and participation in TGO’s LOW Emission Support Scheme (LESS) to reduce greenhouse gas emissions through the use of renewable energy, increasing energy efficiency and waste management.
Climate Risk Management
PTTEP takes into serious consideration the risks that may result from climate change which considers as an “Emerging Risk ”. We identified the following climate change risks (current or future) to have the potential to generate a substantive change in the business operations, revenue or expenditure under the following 3 dimensions:
- Risks driven by changes in regulation
- Risks driven by changes in physical climate parameters
- Risks driven by market changes for countries whose PTTEP is the operator
Our climate change risk management and adaptation studies have revealed that PTTEP currently has no immediate risks. In the medium- and long- terms, there are risks at the medium level according to our internal PTTEP Risk Matrix that will be carefully monitored and mitigated so that the risk is reduced to the as Low as Reasonably Practicable (ALARP) level. PTTEP recognizes the emerging risks from climate change and are committed to ensuring that our business is sustainable by diligently monitoring, evaluating and mitigating the risks. The records of our risks and management methods are input into the SAP GRC system and monitored quarterly.