Targets, technology and transparency
Devon is committed to decarbonizing our operations, evaluating new opportunities and transparently reporting our results. We’re doing our part to be a responsible operator for the benefit of the environment, our employees and their families, our communities, our shareholders and our business – today and in the future.
Reducing the carbon intensity of our operations starts with proactively controlling and reducing air emissions from our operations. Our long-standing commitment to reduce air emissions, particularly GHGs, is embedded in our culture through our Environmental, Health and Safety (EHS) Philosophy and our core values to earn stakeholder trust, proactively manage risk and not miss a chance to improve. We collaborate within and outside the company to apply technology, best practices and tools to reduce our impacts on the air.
Devon focuses on reducing operational emissions of GHGs such as carbon dioxide (CO2) and methane, as well as volatile organic compounds (VOCs), nitrogen oxide (NOx) and other gases, and on reporting our results. To continue our progress, Devon announced in June 2021 that we’ve set aggressive targets to lower the carbon intensity of our operations and committed to further transparency by refreshing our Climate Change Assessment Report by year-end 2021. We’re taking these actions not only to lower regulatory, market and reputational risk, but also because we believe it’s the right thing to do. Ultimately, we believe protecting the air makes our business more sustainable.
Air emissions performance management
To comply with all applicable federal and state laws and regulations, we invest in the latest equipment and deploy well-trained employees and contractors to carry out our emissions reduction programs. Devon’s environmental work includes an air quality protocol that clearly defines responsibilities and requirements for communications, compliance, recordkeeping and training.
Because air emissions programs and results are so important to our overall performance, Devon’s Environmental, Social and Governance (ESG) Steering Committee monitors our performance in the context of the evolving regulatory, legal and stakeholder landscape. The steering committee advises our senior leaders on issues for consideration in enterprise risk management, stakeholder engagement and regulatory and legal compliance.
The vice president of ESG and EHS, a new role at Devon, elevates our company-wide focus on ESG performance, including air emissions. This leader serves on both the ESG Steering Committee and the cross-functional EHS Council, providing continuity and alignment. The EHS Council sets Devon’s emissions reduction strategy, in close coordination with the vice president for ESG and EHS, the ESG Steering Committee and senior leaders for effective implementation of the strategy.
Committed to compliance
Compliance with all applicable federal and state environmental laws and regulations is central to our EHS Philosophy and the Devon Code of Business Conduct and Ethics. Our compliance process guides employees on meeting the requirements of Devon’s air permits in our operating areas, with the aid of a web-enabled database that quickly distributes requirements for new and modified air permits to the people directly responsible for compliance.
Devon facilities and equipment may at times emit VOCs, NOx and other gases that are subject to state permits or emissions authorization limits. We pursue full compliance by clearly communicating requirements to our operating facilities. Some Devon facilities are subject to annual emissions inventories, which we submit to the appropriate regulatory agencies. In states where these inventories are required, the information is publicly available. If issues arise, we work expeditiously and constructively with regulators to address them.
As a proactive operator, Devon will keep looking beyond compliance to continue reducing our air emissions.
Greenhouse gas emissions methodology and performance
Devon reports GHG emissions from fuel combustion, flaring, fugitive emissions, venting and storage losses (Scope 1) and electricity consumption (Scope 2) for assets under our operational control. We collect data on GHGs (carbon dioxide (CO2), methane and nitrous oxide) and submit annual GHG emissions according to the requirements of the U.S. Environmental Protection Agency (EPA) Greenhouse Gas Reporting Program.
We also report indirect emissions from the use of sold products (Scope 3) on an equity basis from sources not owned or controlled by Devon. Scope 3 GHG emissions include indirect emissions resulting from the consumption and use of Devon’s crude oil and natural gas production.
To estimate our Scope 3 emissions, we rely upon IPIECA’s 2016 guidance document, Estimating Petroleum Industry Value Chain (Scope 3) Greenhouse Gas Emissions. According to the IPIECA guidance, category 11 “Use of Sold Products” is generally the largest contributor of Scope 3 emissions for a fuel-producing company and can account for more than 80% of a company’s total Scope 3 emissions. We report “Use of Sold Products” by calculating combustion emissions for our oil, natural gas and marketed natural gas liquids products.
It is important to note that Scope 3 emissions estimates are subject to uncertainty, inconsistency and duplication due to the reporting of assets outside the control of the reporting company and various reporting methodologies. In addition, two or more companies will account for the same emissions within their Scope 1, 2 or 3 emission inventories (as further described in the IPIECA guidance document).
As an exploration and production company, Devon has no direct control over how the raw materials we produce and sell are ultimately consumed. For this reason, we are committed to and focused on Scope 1 and 2 emissions for assets under our control, where we can most directly and meaningfully effect emissions reductions. We will continue to evaluate ways in which we can reduce value chain emissions and engage constructively with stakeholders upstream and downstream of our production operations.
To be a good steward of the environment, we hold ourselves accountable for delivering visible, measurable results on our environmental performance. In 2020, our emissions performance improved year over year:
- GHG and methane emissions
- GHG emissions intensity
- Methane emissions intensity (in both tCO2e/MBOE and % of natural gas produced)
- Flaring intensity
- Facility emissions inspections performed with passing results (89%) improved 3%
New, aggressive emissions reduction targets
Devon established our first voluntary target to limit methane emissions from our oil and natural gas production operations in 2019. We pledged to reduce our methane intensity rate to 0.28% or lower by 2025. Through the expansion of our leak detection and repair (LDAR) program and enhanced data precision efforts, legacy Devon met this target level in 2019 and the pro forma combined company beat the target level in 2020 with 0.19%. We continue to put efforts toward further reductions and in June 2021 established new, aggressive emissions reduction targets.
The ambitious new targets reflect our commitment to continue lowering our carbon impact, while producing the oil and natural gas that will be needed for decades to come. See our targets described to the right:
Our reported emissions can fluctuate from year to year due to changes to our production mix, asset portfolio and other factors. To consistently meet or beat our targets from year to year, we must continue to pinpoint emissions sources and apply technologies and work practices to these sources beyond what’s required by regulations.
Our baseline recalculation methodology
This baseline serves as a hypothetical reference point for what the emissions intensity would have been in the absence of emissions reduction efforts over time. To comparably track progress toward the targets, adjustments to the missions baseline may be necessary to reflect structural, organizational, or reporting changes that may occur over time. For example, an acquisition or divestiture could significantly impact our emissions performance and impair comparability from the emissions baseline.
We relied upon guidance from the Greenhouse Gas Protocol and IPIECA in establishing our baseline recalculation methodology. Our baseline will be adjusted if impacted by one or more trigger events that result in a change to the emissions baseline of 5% or higher on an absolute or intensity basis. Trigger events include structural changes; source ownership or control changes; changes to reporting boundaries, quantification methodologies or data improvements; or discovery of errors.
Our 2019 baseline has been recalculated to reflect the divestiture of the Barnett Shale in 2020, divestiture of the Wind River Basin in 2021, and acquisition of Felix Energy in 2020.
We believe our recalculation methodology affirms our commitment to structurally drive down emissions, rather than divesting assets as a means to achieve our ambitious decarbonization targets. We are committed to the ongoing review and assessment of the appropriateness of our emission reduction target levels and will adjust as needed.
Mitigating air emissions at the source
Our continuous improvement culture has prompted us to develop a detailed understanding of where our emissions come from. This makes it possible to address our air emissions at the primary sources through a variety of effective mitigation strategies:
- Reducing flaring — across our entire portfolio of producing assets
- Finding and fixing equipment leaks with our expanding leak detection and repair (LDAR) program
- Transitioning to air-driven pneumatic controllers
- Cutting combustion from drilling, completions and production by increasing the use of engines powered by electricity and alternative fuels
- Minimizing venting and flaring from storage tanks
We conduct ongoing evaluations into emissions detection and quantification technologies, and we collaborate with industry, environmental groups and agency partners on emissions reduction strategies. Through focused effort in 2020, Devon continued our record of progress in lowering GHG emissions.
Flaring: Sustainable improvements
Flaring of natural gas – a controlled ignition process for eliminating emissions of methane and VOCs – is necessary for safe operations in various phases of the oil and natural gas production process. Devon strives to avoid entirely the venting of raw gas, and to limit flaring to the extent possible at all locations. Reducing flaring is a priority in our broader emissions reduction strategy because we want to protect the environment and capture as much natural gas as possible for its economic value, while also complying with laws, regulations and permits.
We continually evaluate and optimize our facilities, including installing reliable pressure-relief valves to minimize tank releases and vapor recovery equipment to capture flash gas emissions and route them to a pipeline. The company also uses “green completions” to capture produced natural gas following hydraulic fracturing. Where flaring is unavoidable, pilot monitoring equipment is installed to help ensure the gas is properly combusted.
Devon has improved our flaring performance over the last six years, particularly in the Delaware Basin, our highest activity operating area. We identified wellhead flaring due to insufficient natural gas takeaway capacity or midstream constraints as the primary driver of flaring in the Delaware Basin and set out to mitigate the situation. We stopped routine flaring in this region in 2017, only connecting and producing wells when gas takeaway is established. We flare only when experiencing system upsets or midstream or downstream constraints. We took effective action in 2019 to curtail these issues in the Cotton Draw field that accounted for most of our flared volumes in the Delaware Basin (see sidebar).
After seeing significant improvement in late 2019, we continued making progress in reducing our flared volumes. In 2020, legacy Devon flared 0.2% of gross natural gas produced, an improvement of more than 70% from 2019. The reduction was due in large part to alleviating capacity constraints in the Cotton Draw field, but also to concerted efforts across our organization to reduce flaring.
While the industry has faced ongoing capacity constraints in the Williston Basin, our legacy WPX operations in the basin continue to improve our flaring performance. Legacy WPX flaring volumes were down nearly 30% in 2020 compared to 2019, and we continue to evaluate and employ improvement methods in the Williston Basin to drive down flaring. Following the merger, the EHS Council identified the need to integrate flaring data from both legacy companies as a top priority as we began to pursue further performance improvements in 2021. Overall, our flaring intensity improved from 2.2% in 2019 to 1.5% in 2020, an improvement of 33%.
Our updated targets are to achieve flaring intensity of 0.5% or lower of gross natural gas produced by 2025 and to eliminate routine flaring, as defined by the World Bank, by 2030. We expect to drive results by continuing to employ best practices that have proven to be effective for reducing flared volumes and minimizing emissions.
We’ve been expanding these best practices across our operating areas. They include implementing a flare management program; continuous gas capture planning and collaboration with midstream partners; enhancing separation and compression reliability; choke management; pigging lines; and optimizing combustion. We’re also sharing these practices with our trade association partners because we believe it’s crucial that we work together to reduce flaring and air emissions across the industry. Devon will continue to look at a broad spectrum of opportunities to reduce flaring and related emissions to meet our targets.
Equipment leaks: LDAR program continues to grow
Using infrared cameras to detect leaks is one of Devon’s primary emissions mitigation tactics. LDAR has proven to be effective at finding equipment leaks from piping components and associated equipment. It was a major contributor to achieving our first methane intensity target well ahead of schedule and we’re expanding the program to help us reach our new target to reduce methane intensity by 65% by 2030 from a 2019 baseline.
Devon utilizes optical gas imaging (OGI) cameras to perform frequent equipment inspections to detect leaks. We initially prioritized facilities with the highest production volumes across our operating areas. By methodically identifying and fixing leaks, we’ve largely resolved our highest-risk issues and reduced our methane emissions over time.
We have steadily and voluntarily expanded our LDAR program, in part by adding valves, pumps and other equipment into our camera surveys. We also continue to survey additional facilities that don’t currently have a federal or state regulatory requirement.
Environmental operators in each Devon business unit focus primarily on conducting infrared camera surveys at our sites and then making sure repairs are successful. Based on LDAR data, we have progressively refined our proactive maintenance programs by identifying the equipment most likely to develop leaks. This led us to install thief hatches that have a lower leak rate and focus on specific equipment failures and settings. It also enabled us to improve flare maintenance and verify performance of vapor recovery units (VRU).
We continue to learn from the LDAR data we collect and then refine best practices in facility design, equipment improvements and preventive maintenance to further reduce emissions from our facilities. For example, we conduct engineering and pre-startup reviews of facilities and take other steps to help verify closed-vent systems and control devices are designed and properly installed.
Devon builds on these improvements by setting annual corporate goals for fugitive emissions performance. In 2020, legacy Devon and legacy WPX both met our corporate goals for fugitive emissions performance. At legacy Devon, our passing rate (i.e. no leaks detected) for equipment inspections improved 3% year over year, from 86% in 2019 to 89% in 2020. The higher passing rate shows we’re continuously making improvements in equipment design, operation and maintenance, based on what we’re learning from LDAR data.
To further reduce emissions from equipment leaks, in 2021 we’re expanding our voluntary LDAR program to more facilities and doing equipment retrofits for compliance or voluntarily.
To help our administrative offices meet the regulatory requirements for LDAR inspections, our environmental and operations teams developed a mobile app to capture, enter, track and document LDAR survey findings. The app automatically syncs any needed repairs, creates work orders and documents successful repairs, all of which are required for compliance. This has resulted in a more efficient, consistent and systematic LDAR program.
Pneumatic devices: Transitioning to air-driven controllers
Since identifying gas venting from approximately 13,000 natural gas-driven pneumatic controllers and pumps at nearly 2,000 production sites, Devon has worked to mitigate this source of emissions. We replaced high-bleed natural gas pneumatic controllers on hundreds of wells in Wyoming, Oklahoma, New Mexico and Texas, and we no longer use them on new wells. In the Delaware Basin, legacy Devon installed air-driven pneumatic pumps and controllers at all new facilities since early 2019.
Combustion: Replacing diesel-only engines
Diesel motors powering drilling rigs and hydraulic fracturing operations can be a significant source of emissions. Devon has cut these emissions, reduced related noise and shrunk our operational footprint by replacing diesel-only engines with dual-fuel motors that run on diesel or compressed natural gas (CNG), liquefied natural gas (LNG), field gas or electricity. In the legacy Devon drilling operations in 2020, about 54% of our wells were drilled with rigs running on dual-fuel or electricity. This avoided an estimated 15,700 metric tonnes of CO2 from 1.4 million gallons of diesel equivalent.
Electrification will be a key part of our strategy to meet our new targets for Scope 1 and 2 emissions. We seek to plan effectively so we can get grid power to our locations before drilling rigs arrive. Devon also is looking to identify other types of equipment and practices we can power with electricity in the future to avoid using diesel fuel.
Storage tanks: Reducing venting and flaring
To reduce venting or flaring from oil and condensate storage tanks, we install vapor recovery towers (VRT) to maximize gas recovery and minimize the volume of tank vapors that need to be flared. In 2021, we successfully piloted a low-emission storage tank design that further maximizes gas recovery, eliminates the need to flare tank vapors during normal operation and minimizes emissions through a reduction in the number of potential leak sources, as well as components that can lead to common equipment failures, including open thief hatches.
To meet our ambitious emissions reduction goals, using multiple, proactive strategies is more important than ever. Devon continues to pursue a wide range of GHG and methane emissions mitigation tactics.
- Building out Delaware Basin midstream assets to alleviate capacity constraints that exacerbate flaring
- Expanding our LDAR program
- Evaluating and implementing emissions detection and quantification technologies
- Installing air-driven pneumatic pumps and controllers in our production operations
- Increasingly replacing diesel engines with dual-fuel or electric engines
- Electrifying our drilling operations
- Collaborating with industry, nonprofits and government agencies
- Improving our data precision and reporting methodologies
- Installing remote surveillance technologies