Climate & Sustainability Principles
The versatility of natural gas uses in various sectors of the global economy, the flexibility of delivery of liquefied natural gas (LNG), and the search for lower cost, lower emitting energy sources, have created a significant policy role for natural gas (and LNG), along with other lower emitting sources. To address the climate-related risks and opportunities that affect Cheniere’s business and complement our proven commercial and operational strategies, Cheniere has established its Climate & Sustainability principles. These are based on our corporate vision and mission statements and aim to ensure that a culture of sustainability is part of Cheniere’s foundation to achieve a resilient, sustainable business model in the 21st century, while achieving shareholder value. We intend to do that by applying leading science, disciplined operations, engaging with our partners in the LNG supply chain and transparently reporting our Environmental Social and Governance (ESG) performance. These principles have been reviewed by the Board and adopted by the Company and will guide Cheniere’s sustainability efforts moving forward.
Cheniere recognizes the scientific consensus related to human influence on the climate system and the significant challenge of providing clean and affordable energy. We believe the Paris Accord is a good start related to global action. Cheniere sent a letter to the White House in 2017 stating the company’s support of the agreement. Cheniere sees natural gas as a fundamental energy source in the energy transition to a lower carbon future, along with renewable sources of energy. Continued improvements in methane emissions management and success of carbon capture and Sequestration (CCS) are two important programs that need to be supported by the industry.
1. Science: Cheniere will promote and follow peer-reviewed science to assess our impacts, anchor our engagements, and determine our actions
Cheniere recognizes the scientific consensus on climate change and the significant challenge of providing clean and affordable energy. We believe the Paris Agreement is a good start related to global action. Cheniere sees natural gas as a fundamental energy source in the energy transition to a lower carbon future, along with renewable sources of energy.
Cheniere supports collaborative published peer-reviewed research and employs best science to inform policies and decision-making. The company also aims to use its existing expertise and network to highlight the measurable benefits of U.S. LNG over more carbon-intensive energy sources.
Consistent with our principles, in June 2018, we announced the formation of the Collaboratory to Advance Methane Emissions (CAMS) to improve the scientific understanding of methane emissions across the entire natural gas value chain. By working with our peers across the value chain on scientific studies, we believe we can collaborate with our supply chain and other oil and gas companies to better assess the science and deliver cost‐effective and sustainable solutions to reduce methane emissions.
2. Operational Excellence: Cheniere will design and operate our facilities to reduce environmental impacts
Our climate and sustainability efforts start at our facilities. We employ environmental prudence, scientific research, and technological advancements to ensure disciplined operations and excellence. Further, we engage proactively with stakeholders, including local communities, as advisors on sound environmental and social practices.
3. Supply Chain: Cheniere will work with our partners to reduce environmental impacts throughout our supply chain
U.S. LNG has positive climate benefits, but excessive methane leakage can erode this advantage. Cheniere is the largest domestic purchaser of physical volumes of natural gas – linking producers to a global market. Cheniere is taking steps to promote emissions reporting and mitigation practices across our suppliers, many of whom have already taken voluntary steps to reduce methane emissions.
4. Transparency: We will communicate openly and proactively with our stakeholders
Our engagements with our stakeholders must be with respect, transparency and facts. Transparent performance reporting will be the basis of building trust.
The Role of LNG in a Low Carbon Future
Natural gas is a versatile resource that has application in every major end-use sector of the U.S. and global economy as both a fuel and a feedstock and can have an important role in a low carbon energy future. The U.S. Energy Information Administration (EIA) has documented over 2.3 billion tons of CO2 reductions between 2005 and 2017 attributable to the shift in fossil fuels to natural gas – a volume almost equivalent to the total annual emissions of India.
Under the IEA’s Sustainable Development Scenario, which aims to meet the Paris Agreement goals as well as provide universal access to energy and cleaner air quality, natural gas’ share of primary energy demand reaches about 25 percent by 2040 and is the only fossil fuel to see growth between 2016-2040.
The National Energy Technology Laboratory (NETL) and peer-reviewed research from various universities have conducted multiple lifecycle analyses of LNG exports from the U.S. that demonstrates the benefits of U.S. LNG exports in relation to displacement of more carbon-intensive fuel sources, and also natural gas from other exporting countries.
Based on IEA’s projections, natural gas will need to be a foundational fuel to meet the Paris Agreement goals along with renewable energy sources. NETL and Carnegie Mellon’s research show that U.S. LNG is beneficial to reducing GHG emissions on a lifecycle basis.
Therefore, Cheniere’s product – liquefied natural gas (LNG) – can reduce environmental and climatic impacts by displacing fossil fuels that are more carbon‐intensive and produce higher levels of traditional air pollution and mercury.