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Questar Sustainability Report Methane Hybrid

Whereas: Managing and reporting environmental, social, and governance (ESG) business practices helps companies compete in a global business environment characterized by finite natural resources, changing legislation, and heightened public expectations. Reporting allows companies to publicize and gain strategic value from existing sustainability efforts and identify emerging risks and opportunities. ESG issues can pose significant risks to businesses, and without sufficient disclosure, stakeholders and analysts cannot ascertain whether the company is managing its ESG exposure.

A 2012 Deutsche Bank review of over 150 studies on sustainable investing found 89% of studies demonstrate that companies with high ESG ratings show market-based outperformance.  53% of S&P 500 companies and 57% of Fortune 500 companies have issued a sustainability report; 63% of S&P 500 reporters utilized the Global Reporting Initiative (GRI) Guidelines.

Sustainability reporting helps companies communicate their position on issues receiving public scrutiny, such as methane emissions from oil and gas production. Over a 20 year period, methane’s impact on temperature is 72 times that of carbon dioxide and therefore contributes significantly to climate change.
The oil and gas industry accounts for 70% of energy-related methane emissions.  
 
Reducing methane emissions in upstream oil and gas production is one of four policies proposed by the International Energy Agency (IEA) that “could stop the growth in global energy-related emissions by the end of this decade at no net economic cost” and keep the 2 degree Celsius global mean temperature rise goal attainable in 2020.  All four policies “rely only on existing technologies”, “have already been adopted and proven in several countries”, and “would not harm economic growth in any country or region”.
 
The IEA recommends oil and gas producers undertake a set of actions “necessary to realize the economic and energy security benefits while meeting public concerns” of unconventional gas development. One of these actions is to “eliminate venting, [and] minimize flaring and other emissions,” and it recommends producers “consider setting targets on emissions as part of their overall strategic policies to win public confidence.”
 
The IEA states that “public authorities need to consider imposing restrictions on venting and flaring.” A failure by companies to reduce methane emissions may invite potentially inhibiting regulatory responses.
 
Questar Corporation’s overall ESG and related methane emission disclosure is inadequate relative to its peers. The GRI reporting guidelines for oil and gas producers includes disclosure of the quantity of flared and vented hydrocarbons. The Carbon Disclosure Project’s 2013 Oil and Gas supplement will include a questionnaire on methane emissions.

Resolved:  Shareholders request Questar Corporation issue a comprehensive annual sustainability report including a review of the company’s policies, actions, and plans to measure, mitigate, and set reduction targets for reducing methane emissions from the company’s assets and operations.  The report should be prepared at reasonable cost, omit proprietary information, and be made available to shareholders by September 2014.

Supporting Statement:  In preparation of the report, we recommend consideration of the Global Reporting Initiative (GRI) Sustainability Reporting Guidelines, a globally accepted framework with more than 4,000 corporate users.