Rooted in our core values, we maintain sustainable energy practices that exemplify our commitment to energy security and availability. Our sustainability highlights demonstrate an ongoing commitment to creating a resilient and prosperous world.
Letter from the CEO and Safety and Sustainability Committee Chair
Dear Stakeholders,
At Chord, our mission is to responsibly produce hydrocarbons while exercising capital discipline, operating efficiently, improving continuously, and providing a fun and rewarding environment for our employees – all while delivering compelling returns for our shareholders. In 2023, our team of dedicated employees excelled, enabling Chord to return more capital to shareholders than its large-cap peer group while improving methane emissions and safety performance (TRIR) by 44% and 36%, respectively. Chord’s combination with Enerplus in 2024 provides further opportunity for increased scale and financial strength through a premier Williston Basin footprint with a best-in-class balance sheet.
At Chord, we know oil and natural gas will remain essential in meeting the world’s energy needs. With vast petroleum reserves, a strong legal system, and a comprehensive regulatory framework for oil and gas development, the U.S. is well positioned to continue supplying affordable and reliable energy. We believe that investing in countries and companies with strong sustainability records is key to maintaining energy access and reducing GHG emissions. At Chord, we are dedicated to reducing our scope 1 GHG and methane emissions. Since 2019, we have lowered our operated Scope 1 GHG emissions intensity by 57% and methane emissions intensity by 70%.
We expect our stakeholders, and society at large, will remain focused on emissions reductions as well as the reliable delivery of critical energy sources. At Chord Energy we are committed to doing our part. We have voluntarily committed to the World Bank’s Zero Routine Flaring initiative and have replaced or retrofitted nearly 7,000 pneumatic devices, which will eliminate over 230,000 metric tons of carbon dioxide equivalent methane emissions annually, equivalent to 50,000 passenger vehicles. While Chord has continued to make year-over-year improvements in flaring, we are not yet where we strive to be. To accelerate gas capture improvement, the Company has established a team of experts in 2024 to help deliver repeatable gas capture performance in the high ninety percentile.
A commitment to sustainable business operations starts at the top and requires proper governance. The Safety and Sustainability Committee (SSC) of the Board of Directors works with other Board committees and executive leadership, including the Vice President of Sustainability, to pursue continuous improvement in our environmental, social and governance (ESG) performance. In addition, the Compensation and Human Resources Committee plays a vital role in aligning executive compensation with the long-term interests of our shareholders. To that end, and with the input of both committees above, the Board has included quantitative metrics related to safety and environmental performance, and a strategic priority related to improving ESG process and performance, as part of the Company’s short-term incentive program.
Chord’s 2023 Sustainability Report further elaborates on the above referenced performance metrics and initiatives and many more. Our goal with this report is to deliver transparent and authentic information. The Safety and Sustainability Committee of the Board of Directors oversaw the development of this report. The contents of this report were also guided by various leading frameworks, including the Sustainability Accounting Standards Board (SASB) and the Task Force on Climate-related Financial Disclosure (TCFD).
In summary, we remain committed to meeting the world’s growing energy needs while seeking to improve our sustainability stewardship and build upon our ESG efforts to date as we shape an even stronger future for Chord, the communities we serve, and our shareholders. We would also like to express our gratitude and appreciation to the Chord Energy team, as we believe that their combined efforts have favorably positioned the organization for success while advancing our ESG ambitions and priorities.
Thank you for your interest in Chord Energy. As always, we welcome your feedback and are grateful for your continued support and trust.
Sincerely,
Daniel E. Brown
President, Chief Executive Officer and Member of the Board of Directors
Samantha F. Holroyd
Chair, Safety and Sustainability Committee of the Board of Directors
Things we are working on in 2024
2023 Highlights
Environmental
Delivering Reliable Energy with Responsible Practices
Chord Energy is dedicated to minimizing adverse environmental impact. We aim to reduce methane and Scope 1 emissions, eliminate routine flaring, strive for judicious freshwater use, deliver effective waste management, and execute robust spill prevention programs.
Methane Management
Chord Energy monitors and reports operated Scope 1 GHG and methane emissions per the EPA’s Mandatory Greenhouse Gas Reporting Rule (40 CFR Part 98). GHG emissions data can be found in the Appendix of this report. Data is presented in absolute terms, on a carbon dioxide equivalent basis (CO2e), and in terms of intensity levels relative to Chord’s operated production.
Pneumatic Replacement or Retrofit Project
- Chord replaced or retrofitted nearly 7,000 pneumatic devices, which will eliminate more than 230,000 Metric Tons of Carbon Dioxide Equivalent (MTCO2e) of methane emissions annually, equivalent to 50,000 passenger vehicles.
- The completion of all 7,000 retrofits by year end 2023 resulted in a 67% improvement in methane intensity by Dec 2023 compared to 2022.
Improved Gas Capture
- We achieved 17% reduction in flaring intensity compared to 2022 through staggered development planning to help avoid gathering system constraints.
- Implemented continuous improvements in operational and equipment performance, and better flare reliability and combustion efficiency.
Social
Energizing Communities, People, and Our Industry
Chord Energy fuels global energy needs while driving economic growth and community enrichment. We prioritize people, emphasizing health, safety, and empowerment for our workforce and communities. Our innovative culture promotes shared value through care, unity, and ownership, making Chord Energy a rewarding workplace and a leading corporate partner in our operating areas.
Prioritizing Health and Safety
Given our strong commitment to health and safety, we’ve established robust oversight for our initiatives. The Board and its Safety and Sustainability Committee receive quarterly updates on health and safety performance, including reviews of significant incidents and regulatory compliance.
Driving Progress Through a Culture of Continuous Improvement
In 2023, we launched our ‘Women of Chord’ network, an employee resource group committed to building a supportive community that facilitates personal and career growth, champions diversity and inclusion, and inspires future generations. By promoting knowledge-sharing and advocacy, this group strives to create a more inclusive industry.
Partnering with Our Communities
Chord Energy strives to make a positive impact in the communities where we operate. We invest resources to support local nonprofits, facilitate employee volunteer opportunities, and engage with community stakeholders to address concerns effectively. Our approach emphasizes proactive collaboration with local leaders, first responders, and tribal nations, with relationships built on mutual respect and trust.
Governance
Leading with Integrity
Through our corporate governance principles and ESG strategy, we seek to prioritize accountability, shareholder interests, and trust through transparent and authentic reporting.
Board Oversight
The Board oversees the development of the Company’s strategy, which articulates business objectives and provides direction to senior management. At the start of each year, senior management presents the annual business plan to the Board, followed by periodic reviews throughout the year.
During 2023, the Company’s Board and committee meetings were as follows:
- The Board: 15 Meetings
- Compensation Committee: 10 Meetings
- Safety and Sustainability Committee: 4 Meetings
- Audit and Reserves Committee: 5 Meetings
- Nominating and Governance Committee: 5 Meetings
Stakeholder Outreach
In 2023, we invited shareholders representing:
- Over 50% of shares outstanding to meet with us regarding compensation and ESG matters and other topics of interest to shareholders.
- Over 25% of shares outstanding participated in discussions with the Company’s executive management and provided valuable feedback.
Environmental
Delivering Reliable Energy with Responsible Practices
Chord Energy is dedicated to minimizing adverse environmental impact. We aim to reduce methane and Scope 1 emissions, eliminate routine flaring, strive for judicious freshwater use, deliver effective waste management, and execute robust spill prevention programs.
Methane Management
Chord Energy monitors and reports operated Scope 1 GHG and methane emissions per the EPA’s Mandatory Greenhouse Gas Reporting Rule (40 CFR Part 98). GHG emissions data can be found in the Appendix of this report. Data is presented in absolute terms, on a carbon dioxide equivalent basis (CO2e), and in terms of intensity levels relative to Chord’s operated production.
Pneumatic Replacement or Retrofit Project
- Chord replaced or retrofitted nearly 7,000 pneumatic devices, which will eliminate more than 230,000 Metric Tons of Carbon Dioxide Equivalent (MTCO2e) of methane emissions annually, equivalent to 50,000 passenger vehicles.
- The completion of all 7,000 retrofits by year end 2023 resulted in a 67% improvement in methane intensity by Dec 2023 compared to 2022.
Improved Gas Capture
- We achieved 17% reduction in flaring intensity compared to 2022 through staggered development planning to help avoid gathering system constraints.
- Implemented continuous improvements in operational and equipment performance, and better flare reliability and combustion efficiency.
Social
Energizing Communities, People, and Our Industry
Chord Energy fuels global energy needs while driving economic growth and community enrichment. We prioritize people, emphasizing health, safety, and empowerment for our workforce and communities. Our innovative culture promotes shared value through care, unity, and ownership, making Chord Energy a rewarding workplace and a leading corporate partner in our operating areas.
Prioritizing Health and Safety
Given our strong commitment to health and safety, we’ve established robust oversight for our initiatives. The Board and its Safety and Sustainability Committee receive quarterly updates on health and safety performance, including reviews of significant incidents and regulatory compliance.
Driving Progress Through a Culture of Continuous Improvement
In 2023, we launched our ‘Women of Chord’ network, an employee resource group committed to building a supportive community that facilitates personal and career growth, champions diversity and inclusion, and inspires future generations. By promoting knowledge-sharing and advocacy, this group strives to create a more inclusive industry.
Partnering with Our Communities
Chord Energy strives to make a positive impact in the communities where we operate. We invest resources to support local nonprofits, facilitate employee volunteer opportunities, and engage with community stakeholders to address concerns effectively. Our approach emphasizes proactive collaboration with local leaders, first responders, and tribal nations, with relationships built on mutual respect and trust.
Governance
Leading with Integrity
Through our corporate governance principles and ESG strategy, we seek to prioritize accountability, shareholder interests, and trust through transparent and authentic reporting.
Board Oversight
The Board oversees the development of the Company’s strategy, which articulates business objectives and provides direction to senior management. At the start of each year, senior management presents the annual business plan to the Board, followed by periodic reviews throughout the year.
During 2023, the Company’s Board and committee meetings were as follows:
- The Board: 15 Meetings
- Compensation Committee: 10 Meetings
- Safety and Sustainability Committee: 4 Meetings
- Audit and Reserves Committee: 5 Meetings
- Nominating and Governance Committee: 5 Meetings
Stakeholder Outreach
In 2023, we invited shareholders representing:
- Over 50% of shares outstanding to meet with us regarding compensation and ESG matters and other topics of interest to shareholders.
- Over 25% of shares outstanding participated in discussions with the Company’s executive management and provided valuable feedback.
Waves of Hope: Chord Energy’s Campaign to Support Mental Health
Chord launched the Waves of Hope campaign to fight the stigma associated with mental health conditions, and provide education and resources for those struggling with mental health. We are proud of this important campaign, which encourages individuals to take care of their mental health just as they care for their physical health.
