As one of the largest producers of natural gas in the country, Southwestern Energy Company (SWN) is well positioned to help address the intertwined challenges of securing both domestic and global energy needs while supporting a lower-carbon future.
Our strategic acquisitions in 2021 enhanced our ability to support the central role of natural gas in the global energy transition and demonstrate the integration of our Environmental, Social, Governance (ESG) and business strategies. These acquisitions in the Haynesville basin expand our reserves in one of the lowest-emissions basins in the world and increase our access to global liquified natural gas (LNG) markets, further strengthening the sustainability of our business.
We believe our natural gas assets and our focus on being a low-cost, low-emissions operator support a lower-carbon future and help ensure SWN will remain resilient in that future. As illustrated by our recently updated climate scenario analysis, virtually all of our assets remain producible through 2050 even in a net-zero future.
Our approach to ESG, which informs all of our decisions, is focused on three key areas. First, we are working responsibly to secure the role of natural gas in a lower-carbon future, including through reducing our own emissions. Second, we seek to ensure a safe and inclusive workplace for employees and contractors and positively impact the communities in which we live and work. And we seek to create sustainable value through proactive enterprise risk management, accountability, and transparency.
Advancing a Legacy of Environmental Performance
We have a long track record of strong environmental performance and leadership. We set our first long-term emissions target in 2014, as a founding member of the ONE Future Coalition, committing to reduce our methane intensity to less than 0.28% by 2025, and by 2015 were already well below that target.
As part of our belief in continuous improvement, we have included a methane intensity reduction target in our annual bonus program for the last two years. In 2021, we exceeded our goal and in 2022 we committed to reduce methane intensity by at least another 10%.
Building on this legacy of a long-term commitment to reduce emissions and following the integration of two strategic transactions in 2021, we are announcing a new goal to reduce Scope 1 greenhouse gas (GHG) intensity and absolute emissions 50% by 2035 (see page 28 of the report for additional information on this goal). We are committed to achieving the vast majority of the progress toward this target through direct reductions in operational emissions in the communities where we live and work.
This goal puts SWN on a path to achieve net-zero emissions by 2050, consistent with limiting the increase in average global temperature to 1.5 degrees Celsius.
Our legacy of strong environmental leadership is also based on our commitment to minimizing the impact our operations have on local water resources. In 2014, we set a goal of being fresh water neutral, returning more fresh water back to the environment than we consume. In 2021, we achieved our sixth year of fresh water neutral operations, having delivered nearly 16 billion gallons of fresh water to local communities — which was more than we consumed over those six years.
We are the first and only company in our industry to achieve and sustain fresh water neutral operations.
We Are Powered By People
From our drilling sites to our boardroom, protecting the health and safety of our employees, contractors and communities underpins every decision we make. We have reduced the employee and contractor Total Recordable Incident Rate (TRIR) by 40% in the past five years.
We also recognize the importance of fostering a diverse and inclusive environment throughout our company, starting at the top. In 2021, 44% of our Board of Directors was diverse (two women, one Native American and one French national). We are also working to expand the diversity of our workforce and are proud that 36% of our new hires in 2021 were from underrepresented populations.
Strong Governance Is the Foundation of Our Success
Strong governance systems support our unwavering commitment to ethics, integrity, transparency and model corporate citizenship.
SWN’s Board of Directors works closely with our management Team to oversee ESG matters, including addressing related risks and opportunities. Our executive and employee compensation is linked to ESG metrics including safety, spills and — new in 2021 — methane intensity. This report, our 9th annual, demonstrates our dedication to transparency. We have continually expanded and enhanced our disclosures based on stakeholder interests. This year’s report includes increased alignment with the Task Force on Climate-related Financial Disclosures (TCFD).
Our business and ESG success would not be possible without the hard work and ingenuity of our team. SWN employees and contractors are among the best in the industry, and we appreciate their dedication to our company, our communities, each other and the environment.
President & Chief Executive Officer
Our Core Values
Our people are our greatest asset. Thanks to their determination, resilience and commitment to continuous improvement, SWN is a leading natural gas provider that creates sustainable value for our stakeholders. Our core values reflect our shared commitment to bring out the best in one another and build a diverse and inclusive work environment. Our culture and performance are inspired by these core values and our corporate formula — the right people, doing the right things, wisely investing the cash flow from our underlying assets is how we deliver value plus.