Corporate Responsibility

Our approach is to analyze every project individually to determine its economic, safety and environmental impacts over the life of the project

Air Quality

The EPA requires petroleum and natural gas facilities to report under the Greenhouse Gas Reporting Program (GHGRP). The GHGRP requires the reporting of methane (CH4), carbon dioxide (CO2) and nitrous oxide (N2O) fugitive emissions resulting from venting, flaring and combustion associated with oil and gas operating equipment. The GHGRP, however, does not account for all emissions from petroleum and natural gas systems. For example, companies are only required to report basin operations with total annual emissions from all GHGRP defined sources in excess of 25,000 metric tons of CO2 equivalent (mtons CO2e) within defined geographic areas.Cimarex actively reviews all potential emitting devices and the calculations used to estimate emissions from all known sources (not limited to GHGRP). Through this effort we have enhanced our processes to identify and monitor the location of, and emissions from, methane emitting devices across the entirety of our operations. The table to the right illustrates Greenhouse Gas (GHG) emissions we have reported to the Environmental Protection Agency (EPA) for calendar years 2016, 2017 and 2018. The increase in total reported GHG emissions in 2018 is a direct result of expanded GHG reporting requirements and the increased engine horsepower associated with our production growth.  

Cimarex maintains a strong focus on reducing the methane emissions from all of our operations, whether or not required by local, state or federal agencies. As an example, we removed, replaced or retrofitted 100% of all known high-bleed gas pneumatic devices by year-end 2017. As a result, we achieved year-over-year reductions of 18% and 14% in methane emissions during 2017 and 2018, respectively, despite our increases in oil and gas production. We have undertaken a number of additional initiatives to further reduce our methane footprint and emissions in all our development projects. For example, using instrument air in place of pneumatic devices where we can, centralizing production facilities, minimizing flaring events associated with our activities and moving towards electric horsepower where applicable. When building new facilities and updating old facilities, our goal is to minimize emissions. In addition, we have utilized green completions during all flow-back operations since 2015. The results of our methane initiatives are also illustrated in the table to the right. Our ongoing efforts to minimize methane emissions have reduced our year-over-year methane intensity rate by 35% and 25% in 2017 and 2018, respectively. 

In accordance with state and federal requirements, Cimarex has an ongoing leak detection and repair (LDAR) program to help identify and repair methane emissions at our production and compression facilities located on BLM lands as well as for sites constructed after September 2015. Cimarex has expanded its LDAR program to include the inspection of facilities outside of the scope of current requirements. The LDAR program utilizes infrared cameras to monitor emissions that might not otherwise be detected. 

There is a cost to the gas we do not sell. The table to the right also shows our estimated lost value due to methane emissions. In 2018, the net estimated lost value to Cimarex of methane emitted was $1.34 million, which is 0.06% of our $2,339 million in net revenue. We calculate this lost value by converting methane emissions to thousand cubic feet (Mcf) and multiplying this number by our average net revenue interest (NRI) for the same period, which yields our net methane emissions. This number is then multiplied by the average price we received for our natural gas for the same period. To get to a percentage of net revenue, we then take this figure and divide by our total revenue.


Our focus on reducing emissions has proven itself to be a catalyst for more efficient operations. As such, Cimarex holds emission reduction as a core element to our operating standards.

Emissions
(metric tons CO2e)
2016 2017 2018 
Production Segment

 
Carbon Dioxide1 594,711 594,019 773,517 
Methane 778,609 605,037 490,515 
Nitrous Oxide 354 414 505 
Total Production Segment GHG 1,373,673 1,199,470 1,264,538 
Boosting/Gathering Segment

 
Carbon Dioxide1 504,975 630,324 754,471 
Methane 61,338 81,466 86,006 
Nitrous Oxide 216 269 323 
Total Boosting/Gathering Segment GHG 566,529 712,059 840,800 
Total Methane Emissions2                         
(metric tons CO2e)
862,812 707,009 606,730 
Methane Intensity Rate3 0.43% 0.28% 0.21% 
1CO2 emissions increase attributed to increase in engines for compression associated with production growth
2Total methane emissions includes methane emissions from all operations, not limited to EPA reportable emissions
3Intensity rate is defined as total methane emissions divided by total gross operated production
Value of Methane Emissions 2016 2017 2018
Net methane emissions (Mcf) 1,065,213 887,193 672,839 
Realized Gas Price ($/mcf) $2.31 $2.76 $1.99 
Net value of methane emissions ($millions) $2.46 $2.45 $1.34 
Company total revenue
($millions)
$1,257 $1,918 $2,339 
Lost Value as % of total revenue 0.20% 0.13% 0.06%