Houston (21 April 2022) – IADC is troubled by the SEC’s new proposed rule that would require public companies to disclose climate-related information.
The proposed requirements appear outside the bounds of the SEC’s core mission and would impose a significant financial and resource burden on companies for questionable value.
The added cost to public companies outlined by the SEC has yet to be revealed. However, it can be reasonably stated the burden of compliance and cost to public drilling contractors will be significant. The cost of attestation for Scope 1 and Scope 2 emissions alone will have a significant, negative financial impact on drilling companies. Scope 3 requirements, which involve reporting on emissions generated by a company’s suppliers and customers, are particularly complex. Not only is it unrealistic to require a company to collect and report on information from a long list of suppliers and customers, but it also presents increased legal exposure due to the potential for inaccurate third-party data.
Finally, the proposed rule is duplicative regarding emissions reporting and climate risk assessments. Many IADC member companies publish annual sustainability reports that include information about climate risks. The Environmental Protection Agency, through it’s Greenhouse Gas Reporting Program, already collects emissions data from oil and gas companies. This is yet another example of how the proposed rule presents significant burden for little or no value.
IADC strongly urges the SEC to carefully consider feedback from the companies that would be most impacted by this ruling and to closely reexamine its proposal.
The International Association Drilling Contractors (IADC) is a non-profit trade association that is the global leader in advancing and promoting innovative technology and safe practices that bring oil and gas to the world’s consumers.