Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance
• Health
• Safety
• Environment
• Quality

Environmental Achievements

• Reduced diesel consumption by almost zero in several fields and almost 50% in total operation through the implementation of a virtual gas pipeline.
• Increased reserves from 16.1 million barrels to double that amount by year end.
• Initiatives like the “Day of Oxygen” project for tree planting in Trinidad and San Luis de Palenque.

Social Achievements

• Launched several community investment projects across different blocks, including infrastructure improvements, educational programs, health initiatives, and economic development programs.
• Implemented a community credit fund in Puerto Miriam, Villanueva, supporting various productive projects.
• Developed a sustainable cattle-raising project in Barquereña, San Luis de Palenque, providing cattle to community members.
• Training programs for transporters on defensive driving and good agricultural practices for cattle farmers.
• Created employment opportunities for local communities through participatory selection processes for unskilled and skilled labor.
• Supported the development of local businesses, such as Transcurama SAS, a transportation company.

Governance Achievements

• Established a strong HSE (Health, Safety, Environment) program with no reported disabling accidents.
• Implemented a virtual gas pipeline project to minimize gas flaring and utilize it for energy generation.
• Implemented policies and practices promoting human rights, fair labor practices, and anti-corruption measures.

Climate Goals & Targets

Environmental Challenges

• High volumes of associated gas in the La Casona field requiring creative solutions for utilization.
• Limited availability of transportation vehicles for crude oil.
• Restrictions on road access and pipeline capacity.
• Extreme weather conditions affecting cattle farming.

Mitigation Strategies

• Implemented a virtual gas pipeline to transport compressed gas to power generation facilities.
• Developed partnerships with transportation companies to increase capacity.
• Implemented training programs for transporters and cattle farmers to address safety and productivity challenges.
• Developed and implemented a virtual training course on self-protection for employees and contractors.

Supply Chain Management

Responsible Procurement

• Selection of local suppliers based on social, environmental, and participatory criteria.

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather conditions affecting cattle farming and infrastructure.

Opportunities

• Utilizing associated gas for energy generation.

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Opened a gas processing plant in the Capachos block (Arauca), reducing gas flaring and venting, and enabling self-generation of power.
• Avoided emissions of approximately 11,646.3 tCO2e through various initiatives including pipeline construction and the use of reused materials.
• Planted 2,979 trees in Cesar and 82 trees in Cundinamarca.

Social Achievements

• Social investments exceeded COP $15 billion (USD $4.6 million), impacting access to clean water, home improvements, productive projects, infrastructure works, and health programs.
• Executed an education infrastructure project (supplies and furniture) benefiting 16,000 students and 51 schools.
• Received the SURA insurer “Movilidad Segura y Sostenible” (Safe and Sustainable Mobility) award for excellent road safety results.

Governance Achievements

• Adhered to the Extractive Industries Transparency Initiative (EITI).
• Implemented and kept the Procedure for the Processing of Information of Personal Data up to date.
• Implemented a System for Self-Monitoring and Risk Management of Money Laundering, Financing of Terrorism and Financing of the Propagation of Weapons of Mass Destruction Manual (ML/FT).

Climate Goals & Targets

Environmental Challenges

• Cementing work challenges in the Andina Norte-1 well, putting production capacity at risk.
• Ten social conflict incidents affecting operations for 41 days.

Mitigation Strategies

• Successfully completed remedial work on the Andina Norte-1 well, achieving production of about 3,000 barrels of oil per day.
• Effective community engagement strategy to build trust and maintain positive relationships with stakeholders.

Supply Chain Management

Supplier Audits: 130 audits conducted on contractors and subcontractors in 2019.

Responsible Procurement

• Code of Conduct and Ethics
• Socio-occupational audits
• Training and education programs for suppliers

Climate-Related Risks & Opportunities

Opportunities

• Development of energy-efficient products and services.

Reporting Standards

Frameworks Used: GRI, SASB, CDP

Certifications: ISO 14001:2015, OHSAS 18001:2007

Third-party Assurance: PricewaterhouseCoopers AG

Awards & Recognition

• SURA Award for Safe and Sustainable Mobility

Environmental Metrics

ESG Focus Areas

• Climate Change
• Greenhouse Gas Emissions
• Water Stewardship
• Biodiversity
• Human Rights
• Indigenous Peoples' Rights
• Community Relations
• Health and Safety
• Corporate Governance
• Ethics
• Transparency
• Diversity & Inclusion

Environmental Achievements

• Direct CO2 emissions decreased by 26.1%
• GHG emissions intensity ratio decreased by 23.9%
• Energy consumption reduced by 6.17 terajoules
• Zero significant spills in 2020
• Implemented electric power generation equipment from warm production surface fluids (geothermal energy)

Social Achievements

• Invested COP $16,854 million (USD $4.58 million) in social projects (36% increase from 2019)
• Maintained 100% of its employees during the COVID-19 pandemic
• Donated 14,130 food baskets and 86,495 biosafety items to communities through Parex Solidaria
• Renovated burns unit and pediatric emergency room at Simón Bolívar Hospital in Bogotá (USD $1.6 million investment)
• Developed education and water projects benefiting over 70,000 people through Obras por Impuestos program

Governance Achievements

• Established an ESG Steering Committee and Sustainability Working Group
• Integrated ESG risks into the enterprise risk management (ERM) program
• Linked 30% of 2021 short-term incentives to key sustainability metrics
• Set a target to achieve at least 30% women representation on the Board by May 2023
• Became a signatory to the United Nations Global Compact

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacting operations and social initiatives
• Volatile crude oil prices affecting exploration and production activities
• Restricted access to capital and insurance due to strict decarbonization policies
• Emerging climate & GHG emission regulations
• New alternatives to and changing demand for petroleum products
• Social conflicts in operating areas

Mitigation Strategies

• Prioritized employee health and well-being by adhering to safety measures
• Maintained financial flexibility and managed exploration and production activities
• Developed a long-term climate strategy including a low-carbon transition plan
• Implemented rigorous biosecurity protocols
• Donated food and biosafety items to mitigate pandemic impact
• Managed social conflicts within legal framework and industry best practices

Supply Chain Management

Supplier Audits: 17 contractors audited (22.07% of high and extreme risk contractors)

Responsible Procurement

• Contractual clauses
• Audits
• Abastece platform for managing contracting process
• Local procurement promotion

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Restricted access to capital and insurance
• Emerging climate & GHG emission regulations
• Changing demand for petroleum products

Opportunities

• Development of energy-efficient products and processes
• Increasing the proportion of natural gas in the product mix

Reporting Standards

Frameworks Used: GRI, SASB, CDP

Certifications: ISO 14001:2015, OHSAS 18001:2007 (transitioned to ISO 45001:2018)

Third-party Assurance: PricewaterhouseCoopers AG

UN Sustainable Development Goals

• Not disclosed

Several social investment projects identified as contributing to SDGs

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Innovation Award from the Colombian Association of Petroleum Engineers (ACIPET)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Greenhouse Gas Emissions
• Energy Efficiency
• Biodiversity
• Water Management
• Community Relations
• Economic Development
• Human Rights
• Indigenous Peoples' Rights
• Human Capital
• Workplace Health and Safety
• Corporate Governance
• Ethics
• Transparency
• Risk Management

Environmental Achievements

• Reduced scope 1 and 2 emissions per boe by 13% year-over-year and 34% from the 2019 baseline.
• Reduced flaring emissions by 3% year-over-year.
• Avoided 132,423 tCO2e in scope 1 and 3 emissions.
• Achieved a 29% increase in renewable energy use.
• Installed two geothermal power units (expecting to avoid ~580 tCO2e/year per unit).
• Progressed Cabrestero solar field project (operational in 2022).

Social Achievements

• Launched the Growing Together program to spur economic growth by providing training and development to entrepreneurs.
• Invested $3.97 million in key social initiatives, increasing access to water and education through the Works for Taxes programs.
• Increased the total number of jobs (skilled and unskilled) created in Colombia by 32% year-over-year.
• Delivered 6 “Water for All” projects, providing clean water access to 11,000 people.
• Launched “Energy for All” program, powering 2 schools through solar panels.
• Resolved 99% of petitions, complaints, and claims.

Governance Achievements

• Achieved 30% target for board gender diversity (July 2022).
• Released Inaugural TCFD Report.
• Full disclosure of SASB indicators.
• 100% of employees signed off on corporate policies following a knowledge testing assessment.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic presented new and dynamic challenges.
• Blockades and protests (20 in 2021, 65% related to goods and services demands).
• Risk of cyberattacks.
• Risk of spills of crude or hazardous materials.

Mitigation Strategies

• Worked with regional authorities to provide medical assistance and establish the Growing Together program.
• Applied a consistent engagement approach to address blockades and protests, keeping communications channels open and using dialogue.
• Established specific policies and standards, and launched a Cybersecurity Program.
• Implemented processes such as continuous upgrading and maintenance of equipment and facilities, as well as monitoring activities, and a contingency plan.

Supply Chain Management

Responsible Procurement

• Actively engage and work with Colombian-based and regional Latin American businesses.
• Commitment to strengthening the capacity of local businesses and purchasing goods and services from key local partners.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards (2016-2020), SASB reporting standards for Oil & Gas Exploration & Production, TCFD Recommendations, UNGC

Certifications: ISO 45001:2018

Third-party Assurance: PricewaterhouseCoopers AG (limited assurance)

UN Sustainable Development Goals

• SDG 7 (Affordable and Clean Energy)
• SDG 6 (Clean Water and Sanitation)
• SDG 13 (Climate Action)
• SDG 8 (Decent Work and Economic Growth)
• SDG 17 (Partnerships for the Goals)

Parex aligns its social and environmental investments with several SDGs.

Environmental Metrics

ESG Focus Areas

• Strengthening Communities
• Greenhouse Gases (GHG) Emissions & Climate
• People & Culture
• Water Stewardship

Environmental Achievements

• Reduced year-over-year (YoY) Scope 1 & Scope 2 emissions intensity by 4%, resulting in a cumulative emissions intensity reduction of 39% since 2019.
• Connected Cabrestero field to the national electricity grid (70% hydroelectric), avoiding ~5,300 tCO2e in 2023.
• Completed a water footprint assessment.
• Decreased flaring by 5%.

Social Achievements

• Reduced Lost Time Injury Frequency (LTIF) rate by 43%.
• Invested US$20.7MM in local communities.
• Progressed Contractor Management Health and Safety Process.
• Increased employee population by 5%.

Governance Achievements

• Made significant improvements to its Whistleblower Program.
• Linked 25% of short-term incentives to ESG performance metrics.

Climate Goals & Targets

Environmental Challenges

• Temporary blockades and operational suspensions in Arauca Department due to external demands.
• Higher production at some blocks increased their emissions intensity YoY despite reduction efforts.

Mitigation Strategies

• Strengthened relationships with local communities and authorities to find win-win solutions.
• Implemented emission reduction programs including cogeneration, transitioning facilities to natural gas, and renewable power installation.

Supply Chain Management

Supplier Audits: 125 contractors evaluated in 2023

Responsible Procurement

• Code of conduct
• supplier sustainability requirements
• human rights standards

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events
• Increased variability in precipitation patterns
• Increased average temperatures and frequency of extreme heat waves

Transition Risks

• Changes in demand for oil and gas products
• Restrictive decarbonization mandates
• Changes to policies and/or regulations
• Increased legal action on climate-related grounds

Opportunities

• Development of energy-efficient products
• Increasing the proportion of natural gas in Parex’s product mix

Reporting Standards

Frameworks Used: GRI Standards (2021), SASB, TCFD Recommendations, UN Sustainable Development Goals (SDGs)

Certifications: ISO 14001:2015, ISO 45001:2018

Third-party Assurance: PricewaterhouseCoopers AG (PwC)

UN Sustainable Development Goals

• Goal 6 (Clean Water and Sanitation)
• Goal 7 (Affordable and Clean Energy)
• Goal 13 (Climate Action)
• Goal 4 (Quality Education)
• Goal 11 (Sustainable Cities and Communities)
• Goal 15 (Life on Land)
• Goal 17 (Partnerships for the Goals)

Parex's initiatives contribute to these goals through community investment programs, environmental protection measures, and employee engagement.

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Bloomberg’s 2023 Gender Equity Index
• Sura Award in the Safety and Health at Work Category