8th Jun 2021 10:46
(Alliance News) - Zephyr Energy PLC on Tuesday pledged to achieve 100% carbon-neutral operations by September 30 in a move it described as "industry-leading".
The Berkshire-based exploration and production company plans to deliver hydrocarbons produced with an operational net-zero carbon impact and will partner with Prax Group, a London-based firm specialising in the sale of oil products.
Prax Group will work with Zephyr to reduce greenhouse gas emissions with efforts primarily focused on the purchase of sustainability offsets from developers of sustainable projects.
The cost to purchase sustainability offsets is expected to average well under USD1 per barrel of oil equivalent produced, although the net cost may be considerably less given the potential to sell oil at a premium as a result of its net-zero carbon status, Zephyr said.
Zephyr shares were up 7.0% to 3.90 pence in London on Tuesday morning.
"Zephyr recently entered a new phase of growth - we are now a cash-generating oil producer with plans for near-term development on our flagship Paradox Basin appraisal project," commented Chief Executive Colin Harrington.
"This new phase comes with a corresponding new carbon impact, which is why the timing is right to launch what we believe is an industry-leading environmental commitment. As our existing asset portfolio consists of light, high-quality, low greenhouse gas intensity resource developments, we have confidence that Zephyr is an ideal platform from which to launch this initiative."
Zephyr noted it anticipates its "groundbreaking initiative" to yield economic benefits including expanded access to a wider group of potential institutional investors. It highlighted that the average cost of capital for companies with committed environmental, social & governance and decarbonisation initiatives has been shown to be less than that of traditional resource companies.
Incremental regulatory benefits may also materialise from its actions, Zephyr added.
By Will Paige; [email protected]
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