Lipstick, meet pig: US frackers’ hopeless ESG beauty parade won’t wash with investors
American shale oil producers are unleashing a torrent of ESG obfuscation on capital markets in a desperate pitch to green investors. It is destined to fail.
The US fracking industry is redoubling efforts to convince investors that the energy transition will not put it out of business. Amid last month’s frenzy of defensive merger and acquisition deals in the North American shale patch, companies responsible for not insignificant amounts of natural gas flaring, venting and methane leaks—not to mention the production of huge volumes of oil and gas for unabated consumption—made some heroic claims to excellence in environmental, social and governance (ESG) matters.
The most egregious was probably the assertion that the merger of ConocoPhillips with Concho Resources would create a “Paris-aligned” US onshore oil and gas company. This is based on the premise that by achieving ‘net zero’ operational (Scope 1 and 2) emissions by 2050, the pro-forma company will be able to keep fracking oil-rich shale rocks without capturing or offsetting any of its end-use (Scope 3) emissions for another 30 years. Such an assumption seemed flawed even before China, …