Sustainability Reporting

SASB: OIL AND GAS EXPLORATION AND PRODUCTION STANDARD

Jan 2019 – Dec 2019

Download SASB Tables

This document provides information as to the alignment of Serica Energy’s disclosures with the Sustainability Accounting Standards Board (SASB) Oil & Gas Exploration and Production Standard (Version 2018-10). The information herein is associated with the 2019 calendar year.

As we indicate in our 2019 ESG Report, as a new North Sea production operator, Serica recognises the need to comply with the high operational standards demanded of our industry. It is important to us to ensure that those standards are also attained in managing the footprint of our business with the communities in which we operate, where possible, generating benefit for our stakeholders and the communities close to us, which our business has the potential to positively and negatively impact upon. We have chosen to align our disclosure with SASB as SASB's due process has been developed to produce standards for information that are material and decision-useful for our investors, and our stakeholders.

Code Accounting Metric Location/Information
Sustainability Disclosure Topics & Accounting Metrics
Greenhouse Gas Emissions
EM-EP-110a.1

Gross global Scope 1 emissions, percentage methane, percentage covered under emissions-limiting regulations

Serica's gross global Scope 1 greenhouse gas (GHG) emissions (including the relevant GHGs covered under the Kyoto Protocol) data in metric tonnes are presented in the Serica Energy 2019 ESG Report in Appendix 2 - Serica's Data Book, page 43. This includes carbon dioxide, 241,503.41 metric tonnes and methane, 191 metric tonnes (or 4,775 metric tonnes carbon dioxide equivalent). The percentage of methane emissions is 1.98%.

Serica is part of the EU Emissions Trading Scheme (EU-ETS) an emissions-limiting regulation which relies on the methodology of The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard. As a member of the scheme, Serica calculates its CO2 emissions from the use of fuel gas, diesel, propane and its flaring activities. In 2019, Serica utilised 95% of its CO2 allocation, leaving a surplus of approximately 10,000 tonnes of CO2 allocation. In line with EU-ETS Phase III, our CO2 allocation for 2020 will reduce by a further 2.1%. EU-ETS Phase IV, which begins in 2021, applies more stringent CO2 allowances on NACE Code 0620* operators such as Serica, allowing only 30% of our benchmarked allocation from 2021, reducing to 0% by 2030. Page 15 of the Serica Energy 2019 ESG Report provides further detail as to reduction allocations

EM-EP-110a.2

Amount of gross global Scope 1 emissions from: (1) flared hydrocarbons, (2) other combustion, (3) process emissions, (4) other vented emissions, and (5) fugitive emissions

The amount of direct, Scope 1, GHG emissions from flared hydrocarbons is 10,309 metric tonnes, as provided in the Serica Energy 2019 ESG Report in Appendix 2 - Serica's Data Book, page 43. As detailed on pages 15 and 16 of the 2019 ESG Report, excessive flaring during normal operations or platform mode changes neither makes environmental nor economic sense and can cost the Company hundreds of thousands of pounds per annum.

The Bruce platform has a Vent Consent from the UK Oil and Gas Authority for 2.064 metric tonnes per day. Fugitive emissions are calculated annually. In 2019, reported fugitive emissions totalled 1.54 metric tonnes of carbon dioxide (CO2), 9.30 metric tonnes of methane (CH4) and 1.96 metric tonnes of volatile organic compounds (VOCs).

EM-EP-110a.3

Discussion of long-term and short-term strategy or plan to manage Scope 1 emissions, emissions reduction targets, and an analysis of performance against those targets

As indicated in topic EM-EP-110a.1, all of Serica's currently operated assets are part of the permitting and regulatory requirements of the European Emissions Trading Scheme. This scheme is aligned with the Greenhouse Gas Protocol in terms of calculation and reporting of emissions.

In addition, emissions associated with offshore operations in the United Kingdom Continental Shelf or UKCS are regulated by the UK Regulator, the Offshore Petroleum Regulator for Environment and Decommissioning (OPRED) which forms part of the Department for Business, Energy & Industrial Strategy (BEIS) and the UK Oil and Gas Authority (OGA). The permit conditions issued by these regulatory bodies set the emission thresholds to which Serica operates. Permits directly address emissions sources from combustion equipment and not vented or fugitive emissions. Non-compliance with permit conditions can result in fines, improvement and prohibition action and, in the worst case, suspension of production from the platform.

In 2019 Serica reviewed emissions management at the newly procured Bruce Facility and established an internal Emissions Reduction Group to look at all aspects of our business in an attempt to reduce our emissions. Focus areas include reducing the emissions from our open cycle gas turbines, reducing flaring volumes, reducing the use of diesel generation, reducing supply chain emissions and identifying and reducing methane emissions.

A further discussion and analysis of Serica Energy's long term and short term strategy to manage Scope 1 emissions is available on pages 14-16 of the Serica Energy 2019 ESG Report, as well as pages 14 and 15 of the Serica Energy 2019 Annual Report.

Air Quality
EM-EP-120a.1

Air emissions of the following pollutants: (1) NOx (excluding N2O), (2) SOx, (3) volatile organic compounds (VOCs), and (4) particulate matter (PM10)

NOx and VOCs data are presented in the Serica Energy 2019 ESG Report in Appendix 2 - Serica's Data Book, pages 43 and includes: Total NOx 554.90 metric tonnes; and, Total VOCs metric 4.72 tonnes.

Sulphur Oxides and Particulate Matter data are not included as they are not considered to be material to Serica's offshore operations.

Water Management
EM-EP-140a.1

(1) Total fresh water withdrawn, (2) total fresh water consumed, percentage of each in regions with High or Extremely High Baseline Water Stress

Seawater is used at the Bruce Facility to aid the reinjection of oil in produced water. Fresh water consumed on the platform is predominantly desalinated. Fresh water at our facilities is generated onboard and is used for washing, cooking and other domestic purposes. The amount of imported potable water used is minimal, and therefore it is not deemed material.

Utilising the World Resource Institute's (WRI) Water Risk Atlas tool, Aqueduct, Serica Energy does not operate in a region of High or Extremely High Baseline Water Stress.

EM-EP-140a.2

Volume of produced water and flowback generated; percentage (1) discharged, (2) injected, (3) recycled; hydrocarbon content in discharged water

During 2019, 93,629m3 of produced water was generated during production operations on the Bruce platform. 51,238 m3 of this produced water was discharged overboard with an average concentration of 10.33 mg/l, this resulted in 0.529 tonnes of oil being discharged overboard to the marine environment. 42,391 m3 of produced water was reinjected into the reservoir at an average concentration of 68.85 mg/l resulting in 2.92 tonnes of oil being reinjected. Serica does not generate flowback fluid as part of its operations.

Data relating to produced water are also presented in the Serica Energy 2019 ESG Report in Appendix 2 - Serica's Data Book, page 43 as well as in the Produced Water section, page 23.

EM-EP-140a.3

Percentage of hydraulically fractured wells for which there is public disclosure of all fracturing fluid chemicals used

Serica does not use hydraulic fracturing in it's operations. Serica will occasionally use stimulation to support production, however no sites utilised this process in 2019.

EM-EP-140a.4

Percentage of hydraulic fracturing sites where ground or surface water quality deteriorated compared to a baseline

As detailed in EM-EP-140a.3, Serica does not use hydraulic fracturing in it's operations. Serica will occasionally use stimulation to support production, however no sites utilised this process in 2019. Serica meets all regulatory requirements and seeks to limit risks to water quality.

More information is available in the Serica Energy 2019 ESG Report in the section Life Below Water, pages 22 and 23.

Biodiversity Impacts
EM-EP-160a.1

Description of environmental management policies and practices for active sites

A discussion and analysis of Serica's environmental management plans across the lifecycle of operations is available in the Serica Energy 2019 ESG Report in the section Life Below Water, pages 22 and 23.
Serica Energy has developed policies and practices which are aligned with UK legislation as well as the environmental elements of ISO 14001 principles. Some of these elements are part of the International Finance Corporations (IFC) Performance Standards on Environmental and Social Sustainability, including Performance Standards 1, 3, 4 and 6. In 2019 the Serica Environmental Management was subject to, and attested by, an independent verification by Lloyd's Register in accordance with OSPAR Recommendation 2003/5

EM-EP-160a.2

Number and aggregate volume of hydrocarbon spills, volume in Arctic, volume impacting shorelines with ESI rankings 8-10, and volume recovered

Number and volume data is presented in the Serica Energy 2019 ESG Report in Appendix 2 - Serica's Data Book, page 43. Additional information is available in the section, Life Below Water, on page 24 of this report.

None of Serica's facilities are located in the Arctic, or north of the Arctic Circle.

EM-EP-160a.3

Percentage of (1) proved and (2) probable reserves in or near sites with protected conservation status or endangered species habitat

All of Serica's proved and probable reserves are in marine environments. As a required part of site planning, Serica completes an environmental assessment process which includes an evaluation of IUCN Red List species. Information is available in the section, Life Below Water, on page 24 of the Serica Energy 2019 ESG Report.

Security, Human Rights & Rights of Indigenous Peoples
EM-EP-210a.1

Percentage of (1) proved and (2) probable reserves in or near areas of conflict

Serica currently has reserves in the UK and prospective resources in Namibia. None of Serica's net proved or probable reserves are in or near areas of active conflict.

EM-EP-210a.2

Percentage of (1) proved and (2) probable reserves in or near indigenous land

Serica currently has reserves in the UK and prospective resources in Namibia. All of Serica's proved or probable reserves are offshore and not in areas considered to be indigenous land.

EM-EP-210a.3

Discussion of engagement processes and due diligence practices with respect to human rights, indigenous rights, and operation in areas of conflict

A discussion and analysis of engagement processes and due diligence practices with respect to human rights is presented in the section, Peace, Justice & Strong Institutions, page 36-37 of Serica's 2019 ESG Report. In addition, Serica's 2019 Annual Report also emphasises the promotion of a corporate culture that is based on ethical values and behaviours (page 41). This is part of Serica's alignment with the Quoted Companies Alliance Corporate Governance Code 2018.

As indicated in topics EM-EP-210a.2 and EM-EP-210a.1, Serica does not have operations or reserves in indigenous or conflict areas.

Serica has developed a comprehensive Business Management System (BMS) which includes codes, policies and procedures to work fairly and transparently as well as meet all laws and regulations.
As part of this, Serica's Code of Conduct sets out behaviours expected from employees, contractors and third parties who act on Serica's behalf to meet all legal requirements and work to the highest ethical standards. This Code of Conduct is applicable across the lifecycle of Serica's projects, including planning, operation and decommissioning.

Serica complies with the Modern Slavery Act (2015) including implementation of contract clauses, staff training and the right to audit contractors and suppliers to verify compliance. An anti-bribery and corruption policy (please also see topic EM-EP-510a.2) that outlines its zero-tolerance approach to bribery and corruption as well as a whistleblowing procedure for all employees, consultants, contractors or other interested parties are also part of how Serica does business.

Community Relations
EM-EP-210b.1

Discussion of process to manage risks and opportunities associated with community rights and interests

Serica values the importance of supporting and working in collaboration with the communities in which we operate.

A discussion and analysis of the processes, procedures, and practices to manage risks and opportunities associated with the rights and interests of communities is described in both Serica's 2019 Annual Report as well as the 2019 ESG Report. In the Annual Report, information is presented in the Corporate Governance section, including pages 8, 13, 15 and 55. In the ESG Report, details are provided on pages 6 and 33.

As a new North Sea production operator, Serica recognises the need to comply with the high operational and governance standards demanded of our industry. It is important to Serica to ensure that those standards are also upheld when managing the footprint of the business within the communities in which we operate. Serica strives, where possible, to generate benefit for our stakeholders and the communities which our business has the potential to positively and negatively impact upon.

As per topic EM-EP-210a.3, Serica has a number of engagement processes and due diligence practices for working with stakeholders, including communities. Serica has developed a comprehensive Business Management System (BMS) which includes codes, policies and procedures to work fairly and transparently as well as meet all laws and regulations. All Serica's actively operated assets are currently in the UK, however there are plans to develop international operations in the future.

EM-EP-210b.2

Number and duration of non-technical delays

Serica has had no site shutdowns or project delays due to non-technical factors whether through regulatory non-conformance, regulator prohibition or stakeholder challenge or protest.

Workforce Health & Safety
EM-EP-320a.1

(1) Total recordable incident rate (TRIR), (2)
fatality rate, (3) near miss frequency rate
(NMFR), and (4) average hours of health,
safety, and emergency response training for (a)
full-time employees, (b) contract employees,
and (c) short-service employees

TRIR/TRIF data is presented in the Serica Energy 2019 ESG Report in Appendix 2 - Serica's Data Book, page 44.
The near miss frequency rate (NMFR) is:

  • 30.6 per 200000 manhours
  • 153.4 per million manhours

Serica's fatality rate is zero or none (0).

Health, safety and emergency response training for employees, contractors and short-service employees is required as a condition of working with Serica. The scope and detail of training is dependent on the role and will be determined by regulatory requirements, the risk associated with the role and the specifics of the work to be undertaken. For example, Serica's offshore workforce will have different requirements than onshore and office teams. Serica's Training Committee meets monthly and each Serica employee has a training matrix assigned to their role. Serica Energy 2019 ESG Report also highlights the Training Courses and E-Learning Modules available on page 45.

EM-EP-320a.2

Discussion of management systems used to integrate a culture of safety throughout the exploration and production lifecycle

Serica’s goal is to uphold and continuously improve the health, safety and environmental (HSE) performance exemplified on the Bruce platform complex and to extend this approach to any assets we may acquire in the future.

Health and safety is a core requirement of the offshore oil and gas industry. Serica's offshore facilities and the onshore support network are of critical importance to our business and our stakeholders. Serica's commitment to the prioritisation of Occupational Health and Safety is provided in the Serica Corporate and Social Responsibility Section of the 2019 Annual Report (page 57).

The approach to the management of occupational health and safety is also described in Appendix 1 of the ESG Report, How we Manage our Operations, page 42.

A culture of safety is encouraged throughout the organisation with responsible personnel designated at all appropriate levels. This is further detailed in the Decent Work & Economic Growth Section, pages 30 and 31, of the ESG Report.

Reserves Valuation & Capital Expenditures
EM-EP-420a.1

Sensitivity of hydrocarbon reserve levels to future price projection scenarios that account for a price on carbon emissions

Serica Energy's 2P Reserves are 62.3 mmboe adjusted for 2019 production. As of 31 December 2019, Oil 2P Reserves were 14.8mmbbl and 284.7bcf gas.

Serica discloses its estimated hydrocarbon resources and reserves annually based on an independently prepared Competent Persons Report. The reported reserves are supported by an economic valuation which includes all the future costs of producing the relevant hydrocarbons. These costs include buying carbon credits under the EU ETS as necessary based on estimated emissions, the availability of free credits and the purchase price for additional credits. The estimates of Serica's current hydrocarbon reserves are largely insensitive to the anticipated cost of carbon as such cost forms a relatively small proportion of the total cost of production.

EM-EP-420a.2

Estimated carbon dioxide emissions embedded in proved hydrocarbon reserves

Serica does not currently calculate the estimated CO2 emissions embedded in proved hydrocarbon reserves. The proposed SASB calculation method implies that all proved hydrocarbon reserves would be combusted and all CO2 emissions released to atmosphere, however this may or may not be case as Serica does not have a downstream business and sells its product immediately after processing. We do not currently have the means to manage the CO2 emissions in our products and as such cannot provide an estimate of emissions which are currently outwit our control to reduce or manage without coordinated industry, national and international collaboration.

EM-EP-420a.3

Amount invested in renewable energy, revenue generated by renewable energy sales

Serica Energy's current operational focus is offshore oil and gas projects. Serica currently has no revenue from renewable energy sales.

Serica aligns its ambitions with that of the North Sea basin outlined in Oil and Gas UK’s Road Map 2035. Road Map 2035 aims to achieve net zero carbon emissions from the North Sea Basin by 2050 through the development and adoption of low carbon solutions. As part of this, Oil and Gas UK explores the potential for renewable energy technologies to support efficient production and lower emissions.

Serica is currently a member of the Oil & Gas Technology Centre, which explores the development of technologies to decarbonise offshore operations and the advancement of net zero initiatives, supporting the industry’s Roadmap 2035.

EM-EP-420a.4

Discussion of how price and demand for hydrocarbons and/or climate regulation influence the capital expenditure strategy for exploration, acquisition, and development of assets

Serica’s strategy is outlined in its 2019 annual report pages 10 to 24. In order to sustain profits during periods of low commodity prices, Serica focuses on improved efficiency and lower operating costs on its producing assets, without compromising HSE or environmental performance. When looking for exploration, acquisition and development opportunities, Serica runs detailed economic models at a range of commodity and carbon prices and applies geological, political and project risks. Serica sees gas as a key part of the UK North Sea energy transition and has chosen to invest in North Eigg exploration and Columbus development, which are predominantly gas. Serica has also exited regions that are not core to its strategy, see Ireland page 24 of 2019 annual report. Serica works with both its peers and industry bodies (i.e. Oil and Gas UK) to ensure we are involved in discussions relating to any significant future regulatory changes that may impact our company strategy.

Business Ethics & Transparency
EM-EP-510a.1

Percentage of (1) proved and (2) probable reserves in countries that have the 20 lowest rankings in Transparency International’s Corruption Perception Index

Serica currently has reserves in the UK and prospective resources in Namibia and therefore has no (0%) reserves in countries that have the 20 lowest rankings in Transparency's International Corruption Perception Index.

EM-EP-510a.2

Description of the management system for prevention of corruption and bribery throughout the value chain

In order to be recognised as a responsible and sustainable corporate citizen, it is important that Serica’s business is legally compliant and transparent with respect to all forms of anti-competitive behaviour, particularly corruption and competition.

Serica has developed a comprehensive Business Management System (BMS) which includes codes, policies and procedures to work fairly and transparently as well as meet all laws and regulations. As part of this, Serica's Code of Conduct sets out behaviours expected from employees, contractors and third parties who act on Serica's behalf to meet all legal requirements and work to the highest ethical standards. This Code of Conduct is applicable across the lifecycle of Serica's projects, including planning, operation and decommission.

An anti-bribery and corruption policy (please also see topic EM-EP-210a.3) that outlines its zero-tolerance approach to bribery and corruption as well as a whistleblowing procedure for all employees, consultants, contractors or other interested parties are also part of how Serica does business.

Further detail is available in the Corporate Governance and Financial Report sections of the 2019 Serica Energy Annual Report and Accounts (pages 26-60).

Management of the Legal & Regulatory Environment
EM-EP-530a.1

Discussion of corporate positions related to government regulations and/or policy proposals that address environmental and social factors affecting the industry

Serica meets all regulatory requirements. As indicated in topics EM-EP-420a.4, Serica aligns with Oil and Gas UK's 2035 Roadmap, and is taking steps to explore net zero initiatives. All oil and gas operators have an important part to play in the drive towards a lower carbon economy and, through membership of Oil and Gas UK, Serica is committed to working towards a net zero carbon North Sea basin by 2050.

Serica's Operating Management System (OMS) provides procedures for complying with all environmental legislation and regulation, including but not limited to the requirements of both our Pollution Prevention Control (PPC) permit and the requirements of the EU Emissions Trading Scheme (EU-ETS). As regulations change, the OMS is updated to ensure continuous compliance.

A new position, Head of ESG and Business Innovation, held by Clara Altobell, was also created in 2019. This role will support the identification and implementation of environmental and social performance improvements and initiatives.

Critical Incident Risk Management
EM-EP-540a.1

Process Safety Event (PSE) rates for Loss of Primary Containment (LOPC) of greater consequence (Tier 1)

At Serica, health and safety is the highest priority. Empowering our people to be safe is key to how we do business; a safe operation is a an efficient and productive operation. The Bruce facility has a Safety Case which has been accepted by the UK Health and Safety Executive. This Safety Case details the possible failure modes which could lead to a Process Safety Event and the mitigative engineering and human factors which are in place to prevent their occurrence. While all efforts are made to stop Process Safety Events (PSE), if an event does occur, our teams have the training and authority to act quickly and effectively.

In accordance with the requirements of the OPPC Permit, Serica is required to report any event involving the unpermitted discharge of oil at sea, any event causing the escape or waste of petroleum or any release, discharge or incident where there may or has been a significant effect of pollution to the environment. Such occurrences are reported to OPRED within six hours of their identification in a Petroleum Operations Notification 1 (PON1) form.

In 2019, twelve PON1s were raised as a result of the unintentional releases of hydrocarbons to sea. These releases were a result of minor leaks and seeps from the plant and operator or procedural errors and did no therefore constitute loss of primary containment. This is available in Serica's 2019 ESG Report, page 43.

EM-EP-540a.2

Description of management systems used to identify and mitigate catastrophic and tail-end risks

Serica has a number of control systems within the Business Management System (BMS) to identify and mitigate catastrophic and tail-end risks. Serica is committed to identifying and controlling risks and impacts associated with its activities, particularly where the potential exists for major accidents. Serica has a Corporate Major Accident Prevention Policy (CMAPP) which is a regulatory requirement of UK operators as well as a Safety Case for the Bruce platform which has been accepted by the UK Health and Safety Executive.

Occupational Health and Safety Risk is managed in accordance with the Serica Risk Management Policy. The Policy is supported by a number of procedures which describe specific risk management processes such as HAZOP, HAZID, LOPA and the Control of Work.

Serica follows all regulatory requirements across the lifecycle of assets, as part of this Serica is a member of the Operator Co-Operative Emergency Services (OCES) which is the organisational framework under which O&G companies operating in the North Sea co-operate and hare resources in the event of an emergency situation.

Serica is also part of the Emergency Preparedness Offshore Liaison Group (EMPOL). A s a member, Serica meets to discuss best practice, share learnings and identify areas for improvement.

Considering the importance of safety and response management, there are many references throughout Serica's 2019 ESG Report, including: Responsible Consumption & Production, page 13; Contractor and Supplier Assurance, page 20; Partnerships to Achieve Goals, pages 38-39.

Activity Metrics
EM-EP-000.A

Production of: (1) oil, (2) natural gas, (3) synthetic oil, and (4) synthetic gas

Production in 2019 averaged 30,000 boe/d. Oil production in 2019 was 1.3mmbbl and gas production was 49.1 bcf (page 25 of Serica's 2019 Annual Report). Further production information is detailed in Serica's 2019 Annual Report, pages 18 - 22.

EM-EP-000.B

Number of offshore sites

Serica’s main focus is on production and development in the UK North Sea, complemented by a portfolio of oil and gas exploration opportunities, including interests in offshore licence blocks in the UK North Sea and Namibia Basins.

Serica's current offshore sites include:

  • Serica is operator of and has a 98% interest in Bruce, a 100% interest in Keith and a 50% interest in Rhum
  • Serica has an 18% non-operated interest in the Erskine field
EM-EP-000.C

Number of terrestrial sites

Serica does not currently have any terrestrial sites.

 

Careers at Serica
FIND OUT MORE ABOUT CAREERS AT SERICA

COME AND JOIN US

READ HERE