Estimating and reporting greenhouse gas (GHG) data is an important part of the company’s overall climate risk management. We report GHG emissions using an operational control and equity share approach. The operated total includes assets where ConocoPhillips is the designated operator and emissions are reported on a gross basis (excluding heritage Marathon Oil assets). The equity share total includes ConocoPhillips’ equity share of emissions from operated and non-operated assets based on the company’s financial interest. We consider the following three GHG emissions to be material to our operations: Carbon dioxide (CO2), methane (CH4) and nitrous oxide (N2O).
GHG measurement at ConocoPhillips is managed at the business unit (BU) level according to the types of operations/activity and each asset. This is considered a decentralized approach, which allows each BU to identify the methodology required to prepare the asset’s emissions inventory.
The method of data collection at each individual source can range from continuous emissions monitoring to emissions estimations. Our estimating approaches meet applicable regulatory reporting requirements or industry guidance, as appropriate. The quality of estimating methodologies, measurements and calculations is assessed internally by our corporate Environmental Assurance group.
In our corporate reporting system, we include GHG emissions based on direct sources of emissions (Scope 1 emissions) and indirect sources of emissions from imported electricity and steam (Scope 2 emissions).
Reporting to authorities and regulators is conducted by the BUs. We report our operated emissions in the following regions, countries and provinces in accordance with regulations:
At the corporate level, ConocoPhillips reports our GHG emissions to multiple stakeholders, including investors, industry groups and customers.
Our environmental and social performance metrics and disclosures undergo various internal and external audit, assessment and assurance processes. We have engaged in assurance practices for our sustainability disclosures for more than a decade, and we use third-party verification for external, independent, limited assurance of our metrics. We perform reasonable assurance for GHG emissions at select operated assets where it is required by country-level regulation. Measurement, reporting and verification of our climate efforts and GHG data is critical for establishing credibility and accountability around our targets and actions.
Read more鈥痑bout our internal quality assurance and third-party verification.
We have a long legacy of tracking and reporting GHG emissions. However, as technology advances and new information is available, we recognize there are opportunities to improve the accuracy of our data. In 2022, we developed a multiyear environmental data management strategy focused on operated GHG emissions.
This strategy supports our company environmental reporting data principles that are based on the World Resources Institute Greenhouse Gas Protocol Corporate Accounting and Reporting Standard. It focuses on input data quality and the internal controls and systems in place to manage data at an enterprise-wide level. We anticipate as we make changes to improve the accuracy of data, we will experience some fluctuations year over year as part of this multiyear journey.
These are important changes in support of managing climate risks and preparing the company for evolving disclosure requirements.
In addition to the third-party assurance process, our Internal Audit group performs internal assurance of our nonfinancial sustainability reporting following the International Standards for the Professional Practice of Internal Auditing. The first review, completed in 2019, evaluated governance practices, control processes, risk management and metrics reporting practices. To continuously improve disclosure processes and controls, in 2022, Internal Audit reviewed sustainability monitoring and reporting practices, standards, and processes under the direction of our board of directors Audit and Finance Committee. Internal Audit also provided limited assurance over the 2024 environmental and social disclosures before issuance of this year's Sustainability Report.
We continue to advance our internal processes and controls, and evaluate methods to continuously improve the quality, consistency and transparency of our GHG data in order to meet external expectations and evolving regulatory requirements.
With increasing expectations for assurance of sustainability data, potential for future integrated reporting, and in response to proposed climate-related regulatory requirements, we further reviewed our internal process and controls for climate-related risk disclosures relative to those already in place for financial disclosures. This exercise included conducting a pre-assessment of data, processes, systems and controls used to report Scope 1 and Scope 2 emissions and comparing those against proposed regulatory requirements. We continue to collaborate cross-functionally within ConocoPhillips to evaluate how to best manage the broadening governance of ESG disclosures and leverage skill sets gained through designing and maintaining financial assurance processes.