Climate Change Data

Environmental Metrics

ESG Focus Areas

• Health and well-being of employees and communities
• Energy Transition
• Safety
• Process Optimization
• Supply Chain
• Community Relations
• Environmental Performance
• Human Capital Development
• Diversity and Inclusion
• Ethics and Integrity

Environmental Achievements

• Reduced electricity consumption by 3.5% compared to 2019
• Increased water reuse to 85%
• Reduced GHG emissions by 2.3%
• Reduced total waste generated

Social Achievements

• Launched USD 16.2 million fund to support healthcare infrastructure in Latin America
• Invested USD 2,058,734 in community relations program, reaching 52,000 people
• Implemented a webinar cycle for emotional support for employees
• Deployed +Diversity program
• Migrated training offer online
• Supported employees in remote working
• Adapted ProPymes supplier development program to online format

Governance Achievements

• Completed mandatory e-learning courses on Code of Conduct and Business Conduct Policy for all employees
• Implemented a comprehensive Business Conduct Compliance Program
• Established a Transparency Hotline

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic and its impact on operations, oil prices, and demand for hydrocarbons
• Supply chain disruptions

Mitigation Strategies

• Implemented 15 Operational Practices for COVID-19 Prevention
• Adjusted investment plans, made cost reductions, adapted production levels
• Reduced indebtedness
• Implemented Work From Home scheme
• Reorganized groups into small, independently-functioning work units
• Adapted ProPymes program to online format

Supply Chain Management

Supplier Audits: 1,085 companies participated in bidding processes globally

Responsible Procurement

• Evaluation of offers based on suitability, local availability, solvency, quality of services, technical aspects, and HSE performance
• Pre-qualification tool for new suppliers
• Database of qualified suppliers managed by IVALUA platform
• Code of Conduct for Suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: GRI Core, UN Global Compact Ten Principles, UN Sustainable Development Goals (SDGs), Spanish Law 11/2018 on non-financial information and diversity, IFRS-EU

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• SDG 3
• SDG 4
• SDG 6
• SDG 7
• SDG 8
• SDG 9
• SDG 12
• SDG 13
• SDG 15
• SDG 16
• SDG 17

The report details how Tecpetrol's initiatives contribute to these goals throughout its operations and community engagement programs.

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Persona Award for the "Simulators" program

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Human Rights
• Responsible Water Management
• Business Ethics & Transparency
• Community Development
• Health and Safety
• Supply Chain Sustainability

Environmental Achievements

• Lowest lost-time accident rate in Tecpetrol's history.
• Reduced fuel usage leading to GHG emission reduction.
• 64% of water consumption comes from the reuse of greywater.
• 98% of purchases made from local suppliers in Argentina, Colombia, Ecuador, and Mexico

Social Achievements

• 23% of workforce is composed of women (higher than the Oil & Gas industry average in Latin America and Argentina).
• 250 scholarships to students from five communities in Argentina.
• +diversity project promoting equal opportunities.
• Lowest Lost Time Injuries (LTI) rate in the company's history.

Governance Achievements

• Implementation of a new methodology for examining accidents and incidents within the company’s HSE Management System.
• Expansion and improvement of the Health, Safety, and Environment (HSE) management platform.
• No confirmed cases of corruption identified.
• 95% of high-risk personnel trained in business conduct.

Climate Goals & Targets

Environmental Challenges

• Economic context impacted by the COVID-19 pandemic.
• Uncertainty in markets due to the invasion of Ukraine.
• Differences in emissions estimations between operations due to varying calculation methods.
• Water stress in some operational areas.

Mitigation Strategies

• Continuous monitoring of economic situations and implementation of aligned measures.
• Development of a new calculator for GHG emissions aligned with international standards.
• Use of greywater for water consumption in high-stress areas.
• Careful studies of water utilization sources and availability analysis.

Supply Chain Management

Supplier Audits: 477 suppliers managed through digital platform (55% increase compared to 2021)

Responsible Procurement

• ProPymes program supporting SMEs
• Code of Conduct for Suppliers
• Comprehensive evaluation process considering suitability, capacity, quality, and HSE performance
• 100% digital and open solution for supplier prequalification

Climate-Related Risks & Opportunities

Opportunities

• Development of energy-efficient products
• Investment in renewable energies, carbon capture technologies, and afforestation/reforestation projects

Reporting Standards

Frameworks Used: GRI Standards 2021, GRI 11: Oil and Gas Sector 2021, Spain's Law 11/2018 on non-financial information and diversity, UN Global Compact

Certifications: ISO 14001, ISO 45001

Third-party Assurance: PwC

UN Sustainable Development Goals

• Goal 7
• Goal 8
• Goal 9
• Goal 10
• Goal 12
• Goal 13
• Goal 16

Tecpetrol aligns its practices with the SDGs, identifying those with stronger connections to its business and where it can make a greater contribution. Specific examples are provided throughout the report.

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Human Rights
• Community Relations
• Responsible Water Management
• Greenhouse Gas Emissions
• Occupational Health and Safety
• Business Ethics & Transparency
• Supply Chain Management
• Biodiversity

Environmental Achievements

• Reduced production water generated by the fracturing stage
• Implemented campaigns to reduce greenhouse gas emissions
• Achieved a significant GHG reduction in Golfo San Jorge Basin by replacing electric generators with more efficient equipment, saving 10,000 m3/day of gas consumption
• Implemented digital mitigation initiative for gas venting in Neuquén Basin, using un-evacuated gas as fuel for cryptocurrency mining
• Increased water reuse by 5% compared to the previous period
• Reduced oily soil generated in spill cleanup by up to 80% in Golfo San Jorge Basin
• Treated and reused 13,260 t of oiled soils

Social Achievements

• Maintained the lowest rate of accidents with lost time in Tecpetrol's history, receiving the 2023 Integrated Safety and Environment Management Award from IAPG
• Launched +diversity initiative four years ago, promoting equal opportunities and appreciating cultural diversity
• 98% of purchases made from local suppliers
• Implemented Wellbeing Plan for all employees, including flexible days and snack cards, extended maternity and paternity leaves, and an Employee Assistance Program
• Supported SMEs through ProPymes program, reaching 257 SME companies at the end of 2023
• Won the “INcluye” México 2023 award for the +d cards initiative
• Implemented the Roberto Rocca Technical Gene Program, providing vocational internships for students from technical high schools

Governance Achievements

• Established a regulatory and internal control framework ensuring best practices in quality, safety, environment, and social aspects, and high ethical standards
• Implemented a Risk Management Matrix to identify and manage risks
• Established a Business Conduct Compliance Program, including annual evaluation of corruption risks
• Implemented a Code of Conduct for Suppliers, based on UN recommendations
• Established protocols for assessing and recruiting third parties, incorporating due diligence steps
• 97% of personnel received anti-corruption training

Climate Goals & Targets

Environmental Challenges

• Average international hydrocarbon prices dropped compared to 2022 due to global supply adjustment
• Limitations on access to foreign currency and tax regime on imports and exports in Argentina
• Managing risks tied to specific regions, including macroeconomic factors, governmental conditions, and operational risks concerning labor and environmental factors
• Reducing GHG emissions from venting and fuel use in E&P sector

Mitigation Strategies

• Permanent monitoring of economic context to ensure personnel integrity, maintain operations, and preserve financial situation
• Implemented HSE Management System emphasizing prevention programs, risk assessment, and improvement strategies
• Implemented a Management Matrix to identify and manage risks
• Implemented GHG “Champions” program in Neuquén Basin, with 14 initiatives to reduce emissions
• Implemented a more detailed study of GHG reduction initiatives in Colombia, establishing inclusion of some initiatives in the Comprehensive Plan for Business Climate Change Management for 2024
• Continued application of the Leak Detection and Repair Program (LDAR) in Mexico

Supply Chain Management

Supplier Audits: More than 400 suppliers added through digital platform; 83 requirements considered in supplier evaluation process, based on ISO 9001:2015, ISO 14001:2015, ISO 45001:2018 and API Q2 standards

Responsible Procurement

• Supplier Code of Conduct based on UN recommendations
• Due diligence steps for selecting and recruiting third parties
• ProPymes program to support SMEs

Climate-Related Risks & Opportunities

Opportunities

• Development of energy-efficient products
• Investment in renewable energy
• Investment in lithium extraction
• Investment in hydrogen and geothermal energy

Reporting Standards

Frameworks Used: GRI Standards 2021, SASB Standards, IPIECA guidelines, UN Global Compact

Certifications: ISO 9001, ISO 14001, ISO 45001

Third-party Assurance: PwC

UN Sustainable Development Goals

• Goal 7 (Affordable and Clean Energy)
• Goal 8 (Decent Work and Economic Growth)
• Goal 9 (Industry, Innovation and Infrastructure)
• Goal 13 (Climate Action)
• Goal 17 (Partnerships for the Goals)

Tecpetrol's initiatives contribute to these goals through investments in renewable energy, promotion of decent work and economic growth, development of sustainable infrastructure, reduction of GHG emissions, and partnerships with communities and other organizations

Sustainable Products & Innovation

• DLE technology for lithium extraction
• Renewable energy projects (wind farms)

Awards & Recognition

• 2023 Integrated Safety and Environment Management Award from IAPG
• “INcluye” México 2023 award