EO100 &Standard&Technical&Addendum& EO100!for!Shale!Oil!&!Gas!Operations!

Transcription

1 EO100 &Standard&Technical&Addendum& EO100.1:ShaleOil&GasOperations OWNER: SUBJECT: BoardofDirectors,EquitableOriginStandardsLLC EO100 forshaleoil&gasoperations DATE: 3/13/2015 EDITION: USAGE: Final Draft_X_ Public_X_Internal REVISION: Equitable Origin Standards LLC Revision 2 Page 1 of 19

2 FOREWORD' ThemissionofEquitableOrigin(EO)andEquitableOriginStandards(EOS)istoprotectthepeople, the environment and biodiversity affected by oil and gas exploration and production through an independent, stakeholderznegotiated, marketzdriven certification system that distinguishes and rewardsoperatorsforoutstandingsocial,environmentalandsafetyperformance. In2013,theEquitableOriginStandards(EOS)Boardapprovedareviewoftheapplicabilityofthe EO100 Standardtounconventionaloilandgasproduction,heredefinedasshaleoilandgas.Itwas concluded that the EO100 Standard broadly applies to shale oil and gas production but that additional stakeholder engagement would be necessary to ensure adequate coverage of specific socialandenvironmentalimpactsassociatedwithhydraulicfracturingandotheractivitiesatshale developmentsites.in2014,eoconductedadditionalresearchandconsultedwithstakeholderson keyconcernsrelatedtoshaledevelopmentandtheeosboardapprovedtheexpansionofthescope ofapplicationoftheeo100 Standardtoshaleoilandgasoperations. EOconsidersthisscopeexpansiontobealignedwithourmissionandanopportunitytoincrease our impact by bringing greater social and environmental responsibility, transparency, and accountabilitytoincreasinglycommonresourceextractionpractices.whileshaledevelopmenthas arguablyresultedinsomepositiveimpactsandisintegraltothecurrentandprojectedenergymix, shale development practices, such as hydraulic fracturing that uses high volumes of water, have alreadyhadsignificantsocialandenvironmentalimpactsonlocalcommunitiesandecosystems. ThisTechnicalAddendumtotheEO100 StandardservestoclarifyspecificPerformanceTargets underthefollowingsectionsofthestandardforshaleoilorshalegasoperatorsseekingeo100 certification: Principle2:HumanRights,SocialImpact&CommunityDevelopment Principle3:FairLaborandWorkingConditions Principle4:IndigenousPeoples Rights Principle5:ClimateChange,Biodiversity&Environment Principle6:ProjectLifeCycleManagement Thestandardsbelowreflecttheexpectationsofoperatorsregardingmanagementandmitigationof socialandenvironmentalimpactsassociatedwithdevelopmentofshaleoilandgasresources.many of the issues addressed in these standards are also applicable to conventional oil and gas operations,buttheyareemphasizedherebecauseoftheoftenhigherdensityofshaleoilandgas infrastructure, and its increasing proximity to highly populated areas that have not previously undergoneoilandgasdevelopment. ' ' 2015 Equitable Origin Standards LLC Revision 2 Page 2 of 19

3 REFERENCES' EO100 Standard2012(A) EO100 StandardGuidance EOPZ101StandardDevelopmentandGovernance EOPZ102EO100 Scope&Eligibility EOPZ103EOPolicyonAssociation EOPZ203ComplaintsandAppeals SCOPE' ThisTechnicalAddendumappliesspecificallytoshaleoilandgasdevelopmentsites.Extractionof shalegasandshaleoilortightoilutilizestechnologycommonlyknownashydraulicfracturingas partofthewelldevelopmentprocess. Othermethodsofextractingunconventionaloilandgasresourcesareoutofthecurrentscopeof the EO100 Standard, including open pit mining, strip mining, underground mining, or inzsitu extractionofhydrocarbonsfromoilsandsoroilshales. Operators are expected to implement the EO100 Standard in full and reference this Technical Addendum to ensure that, for the following social and environmental performance targets, sites meettheintentofthetargets applicabilitytoshaleoilandgasoperationsduetotheuniquenature ofpotentialrisksandimpactsthatshaleoperationspresenttocommunitiesandtheenvironment. This Technical Addendum also applies to approved auditors carrying out EO100 certification audits as it includes audit indicators to clarify data points to be gathered and reviewed during auditsofshalesites. AsperEOPZ103Scope&Eligibilitypolicy,theguidelinesapplytotheUnitofCertifiableProduction (UCP)oraggregatedUCPs(seebelow). TERMS'AND'DEFINITIONS' Unit' of' Certifiable' Production' (UCP): (1) A well pad and all gathering pipelines, tanks and transfer equipment leading up to the point at which physical custody is transferred (e.g., Lease Automatic Custody Transfer or LACT Unit) and (2) all equipment (e.g., storage tanks, pipelines), facilities(e.g.,productionbatteries)andservices(e.g.,workshops,accommodationcamps,offices, warehouses, pipe yards, roads) that support part (1) of this definition whether or not the equipment,servicesorfacilitiesaresharedandregardlessoftheirgeographiclocation.wellpads thatareessentiallycontiguous(e.g.,separatedbyaroadway)mustbetreatedasasingleunit. Allowable'UCP'Aggregations:'multipleUCPsrunbyasingleowner/operator,whichshareasingle managementsystem;aregeographicallyproximate,interconnected,andwithinthesameblock;and 2015 Equitable Origin Standards LLC Revision 2 Page 3 of 19

4 whichhaveasimilarsetofstakeholders.thenumberandtypeofaggregateducpsmustnotinhibit effectiveadoptionoforcertificationtoeo100. ' 2015 Equitable Origin Standards LLC Revision 2 Page 4 of 19

5 PERFORMANCE*STANDARDS* ThefollowingperformancestandardsshouldbeusedbyoperatorstoensureconformancewiththeEO100 StandardProvisions referencedintheleft?handcolumn.theperformancestandardselaborateontheprovisionreferencedandshouldbereadin conjunctionwiththeassociatedlevel1performancetargetsintheeo100 Standard.TheAuditIndicatorprovidesguidancetoauditors onthespecificinformationtoreview. EO100 & STANDARD& REFERENCE& PERFORMANCE&STANDARDS& Principle&2:&HUMAN&RIGHTS,&SOCIAL&IMPACT&&&COMMUNITY&DEVELOPMENT& & 2.5&Fair,&Inclusive& Engagement&&& Consultation& 2.6&Risk&Mitigation,& Management& Operator conducts meaningful community engagement and consultation around project risks andimpactsthatallowsforbroadparticipationoflocalcommunities. 1 Where operations encroach into urban and suburban environments, Operator engages and consults affected communities regarding appropriate setbacks (i.e., the distance between residential, commercial, or other potentially sensitive land use areas and well sites) in cases whereregulationdoesnotalignwithstakeholderexpectationsordoesnotexist. Operatorconductsahumanrightsimpactassessment. 2 AUDIT&INDICATOR& Communityengagementpolicies andrecords Stakeholderconsultationon setbacks HRIAdocumentation 1 Forguidance,seeICCR ssocialsustainabilityresourceguide:buildingsustainablecommunitiesthroughmulti?partycollaboration,2011,iccr;stakeholder Engagement:AGoodPracticeHandbookforCompaniesDoingBusinessinEmergingMarkets,2009,InternationalFinanceCorporation 2 Forguidance,seeIFCGuidetoHumanRightsImpactAssessmentandManagement;DanishInstituteforBusinessandHumanRights HumanRightsCompliance AssessmentTool;EuropeanCommissionOil&GasSectorGuideonImplementingtheUNGuidingPrinciplesonBusinessandHumanRights,2013,InstituteforHuman RightsandBusinessandShift; Integratinghumanrightsintoenvironmental,socialandhealthimpactassessments.Apracticalguidefortheoilandgasindustry,2013, IPIECA 2015 Equitable Origin Standards LLC Revision 2 Page 5 of 19

6 & 2.11&Grievance& Mechanism& 2.12&Community& Health&and&Safety& Operator provides affected communities with up?to?date information regarding ongoing uncertainties about the risks of shale development, including quantitative documentation of uncertainties when appropriate (e.g., quantified probabilities of risks to water or other resources,andcharacterizationofresultingconsequences). Operatoridentifiescommunityimpactconcernsandrespondstothem.Concernsarediscussed and appropriate responses are prepared, budgeted, implemented and monitored. Operator maintainsstatisticsonlocalcommunityconcernsandreportsthemtoseniormanagementand backtothelocalcommunity. 3 In areas affected communities, Operator establishes appropriate setbacks (defined as the greater of those required by law or those agreed to by stakeholders) from residential, commercial,orotherpotentiallysensitivelanduseareasforlocatingwellpadsandothersurface infrastructure.operatorusesbestmanagementpracticesforsetbacksfromoccupiedbuildings such as houses, schools, churches, and commercial establishments and from potentially sensitivelanduseareas;andrelatedconcernsoflocalcommunitystakeholdersduringthesiting process.withinthesite,differentareassuchaswastewaterpits,wastewatertreatmentplans, wells, may require specific setback limits. Operator implements controls, mitigation, and agreementsforfinancialcompensationifepisodicimpactsoccur. Communicationofrisksand uncertainties Disclosureofcommunityconcerns Actualsetbackdistances 3 Forguidance,see"Communitygrievancemechanismsintheoilandgasindustry.Amanualforimplementingoperational?levelgrievancemechanismsanddesigning corporateframeworks",ipieca,january Equitable Origin Standards LLC Revision 2 Page 6 of 19

7 2.14&Economic&&& Social& Opportunities& Operatorgathersandusesinformationaboutcommunityroadusetoavoidnegativelyaffecting thehealthoflocalcommunitymemberssuchasensuringsafedrivingpractices,minimizinguse ofroadsduringpeakhoursandtakingspecialprecautionsnearschools(seealso6.6secondary &CumulativeImpacts). Operatorevaluatesthelevelofdustcreatedbythesite suseoflocalinfrastructureandreduces andmitigatesdustemissionswherenecessary. Operator adjusts activity schedules to prevent or reduce traffic congestion and maintains a recordofassociatedtrafficaccidents. Operatorevaluatesroaddamagecausedbyitsoperationsandcompensatesfororremediates anynegativeimpacts. Operator regularly monitors community health and mitigates health risks related to potential healthimpactsofshaleoperationsandtheuseofhydraulicfracturing,includingbutnotlimited to: Trafficaccidents Silicosis,respiratoryillnessesanddermaldiseasesassociatedwithhydrocarbonexposures Upperrespiratory,neurological,gastrointestinal,anddermatologicalsymptomsassociated withhydrocarbonexposuresandexposurestochemicalsusedinhydraulicfracturing Operator communicates anticipated job creation numbers and reports actual job creation figuresoverthecourseoftheproject. Principle&3:&FAIR&LABOR&&&WORKING&CONDITIONS& 3.6&Occupational& Health&&&Safety&& Operator conducts due diligence when hiring contractors regarding health & safety issues; ensurescontractorconformancewithoperator shealth&safetypoliciesandevaluateshealth& Measurestoaddress transportationimpacts,including risksoftransportationaccidentsin localcommunities;measuresto reducedust;trafficcongestion levels;baselineandongoing monitoringofroadconditions Communityhealthmonitoring, mitigationplans,toxicologyreports Disclosureofjobcreationfigures disaggregatedbynumberofjobs heldbylocals. Contractorduediligenceand oversight 2015 Equitable Origin Standards LLC Revision 2 Page 7 of 19

8 3.7&Emergency& Preparedness&&& Response&Planning& & safetyperformanceofcontractors. Principle&4:&INDIGENOUS&PEOPLES &RIGHTS& & Operatorminimizesriskoftrafficaccidentsbyensuringallemployeesandcontractorsreceive comprehensiveworkertrainingondrivingsafety,includingdrivingheavyvehiclesinresidential orcommercialareas. Operator ensures chemical labeling, training, Personal Protective Equipment (PPE), secondary containmentandmonitoringproceduresareinplacetosafelymanagethehandling,storageand disposalofchemicals. Operator conducts hazard risk assessments, including explosion risks, and develops risk managementplanstomitigateincidents. Operator regularly monitors worker health, especially where employees are exposed to hazardous chemicals, naturally occurring radioactive materials from flowback or produced water,and/orhydrocarbons.workerhealthmonitoringincludesbutisnotlimitedto: Silicosis,,respiratoryillnessesanddermaldiseasesassociatedwithhydrocarbonexposures Upperrespiratory,neurological,gastrointestinal,anddermatologicalsymptomsassociated withhydrocarbonexposuresandexposurestochemicalsusedinhydraulicfracturing Any airborne or waterborne health impacts identified should trigger additional impact evaluationsfornearbypopulationsinpotentiallyaffectedcommunities. Operator provides proper training for onsite workers in case any exposure to hazardous materials and pays for the proper emergency equipment. Operator ensures emergency protectiveequipmentisaccessibleandavailableforimmediateuse. & Job?relatedmortalityfromworksite or traffic accidents; driving safety trainingforworkers Safetyproceduresandtrainingfor chemicalmanagement Riskassessments Workerhealthmonitoring Emergencyequipmenttypesand location 4.1&Free,&Prior&and& OperatorobtainsFree,PriorandInformedConsent(FPIC)forthedisposalorlong?termstorage Evidenceofconsentfor 2015 Equitable Origin Standards LLC Revision 2 Page 8 of 19

9 Informed&Consent& ofhazardousmaterialsonthelandsorterritoriesofindigenouspeoples. OperatorobtainsFPICfortransport(acrosslands/territories),transfer(withinlands/territories), and injection of wastewater, flowback and produced water, or other byproducts (within indigenouslandsorterritories,orinareasfromwhichchemicalsinwastewatercouldmigrateto indigenouslandsorterritories). OperatorobtainsFPICforextractionofwaterforuseinhydraulicfracturingwherethewateris drawnfromsourceswithinindigenouslandsorterritories. Principle&5:&CLIMATE&CHANGE,&BIODIVERSITY&&&ENVIRONMENT& 5.3&Climate&Change& OperatorimplementsbestavailablepracticesandtechnologiesforreducingGHGemissionsof naturalgasproductionandinfrastructureoperations,suchasgreencompletions 4 ;useofnatural gas,renewableenergyorotherreduced?emissionmethodstopowerwellpadoperations; conversionofvehiclefleetstoloweremissionfuels;replacementofhigh?bleedpneumatic controllerswithloworno?bleedpneumaticcontrollers;useofpipelinesinsteadoftrucksor railcarstomovewaterorproducedoil/gas. OperatorimplementsacomprehensiveLeakDetectionandRepair(LDAR)programwithatleast quarterlychecksthatcoverallinfrastructureinordertominimizefugitiveemissions. Operatorcontributestoinnovation,includingrenewableenergy,wherepossible,bypilotingand deployingnoveltechnologiesandpracticesthatreduceemissionsorenhancetheenergy efficiencyofoperations.. wastewaterhandlingpracticesand waterextraction UseofGHGemissionsreduction practices;ghgemissionsinline withorlessthanlegal requirements 5.5&Land& Operatorperformsa3?Dseismic(orequivalentanalyticalapproachtoidentifyunknownfaults) Pre?drillingevaluationofseismic 4 Greencompletions:equipmenttocapturegasandcondensatethatcomesupwithhydraulicfracturingflowback,preventingtheirreleaseintotheair Equitable Origin Standards LLC Revision 2 Page 9 of 19

10 5.6&Water& surveyoftheprojectareabeforedrillingtolocatefaults.injectingwastewaterintothegroundis only carried out following a pre?drilling evaluation to establish a geological baseline for the location of faults to identify the potential risk of enhanced seismic activity (see also 5.14 Monitoring). Operator studies the formation wastewater is to be injected into and minimizes the risk of comingintocontactwithaquifers. Operatorevaluates landscape?level impacts due to the high number of wells required for full fielddevelopmentanddevelopsandimplementsmitigationmeasuresinconsultationwithlocal communities. Operator minimizes operation s physical footprint by maximizing the number of wells on one pad. Operatorco?locatesinfrastructure(e.g.roadsandpipelinesinthesamerightofway)to minimizesurfacedisturbance. Operatorevaluatespotentialrisksandimpactstowildlifemigratorycorridorsandhabitatfor speciesofconcernwhenlocatinginfrastructure. Operator incorporates a commitment to the right to water in its human rights policy and endorsestheunceowatermandate. 5 Operatorensuresthatitswaterusedoesnotimpedethelocalcommunity suseofwatertothe level needed to meet their needs in the short and long term. Operator assesses; documents; procures, where necessary; and respects water rights and water use rights, of local and risks;distanceofwellsfromactive faults Evaluationoflandscapeimpacts andmitigationmeasures Communitywateruseandwater riskassessment Equitable Origin Standards LLC Revision 2 Page 10 of 19

11 indigenous communities, both formal and informal, that are affected by the site s water use. Wateruseissustainablerelativetocommunityuseandrenewablesupplies. 6 Operatormeasures sustainability of water use by sources (aquifer, river, basin, catchment). In countries where waterrightsarecommoditized,faircompensationismadetoappropriatepartiesforacquisition of the necessary water (see also 1.6 Transparency & Disclosure, 5.11 Waste Production & Managementand5.14Monitoring). Operatormanagesimpactsrelatedtostormwaterandextremeflowevents. Operatormonitorssurfacewaterwithdrawalstiedtoseasonalflowstoensureflowratesarenot significantlyimpactedconsideringcumulativeimpactsandareinlinewithlocalregulationsand withsustainabilityoflocalcommunityaccessandusewhereregulationsdonotexist. Operatorworkswithlocalcommunitiestoconductjointmonitoringofwaterresourceimpacts. Operatordevelops local source water protection plans that include addressing regional water risks, engaging with key stakeholders and supporting projects that improve watersheds and aquifers. Inareaswithhighwaterrisk 7,operatorassessespotentiallong?termwaterconstraintsdrilling and completion plans, including projected water needs for re?fracturing, manages risks associatedwithwell?boreintegritychallengesthatmayoccurforoldwellsandtakesappropriate actions. 8 6 Forguidance,seeUNGlobalCompactCEOWaterMandate:GuidanceforCompaniesonRespectingtheHumanRightstoWaterandSanitation,PacificInstituteand Shift,January Areasofhighwaterriskaredefinedasthoseareasexperiencingdrought;highwaterstressareaswherethemajorityofsurfaceandgroundwaterisalreadyallocated formunicipal,industrialand/oragriculturalusesorwherewateravailability,waterqualityandtheaccessibilityofwaternegativelyaffecttheabilitytomeetthehuman andecologicaldemandforfreshwater;orareasexperiencinggroundwaterdepletion.forguidance,seethewwfwaterriskfilterandtheworldresourceinstitute s (WRI)AqueductTool. 8 Forexample,increasingtheuseofrecycledwaterormakinguseofwatersourcesthatdonotcontributetonormalorforecastcommunitydemands Equitable Origin Standards LLC Revision 2 Page 11 of 19

12 Inareasofhighwaterrisk,operatordoesnotusewaterforhydraulicfracturingfromasource thatisalsousedasasourceforacommunitywatersupply. Operator evaluates chemical additive use and substitutes less toxic compounds or reduces amounts used. Operator develops screening tools to analyze the risks associated with each chemical additive and requires increasing levels of management approval for higher?toxicity additives. Operator does not use diesel oil, kerosene, BTEX (benzene, toluene, ethylbenzene, xylene),jetaaviationfuel,or#2fueloilinfracturingfluids. 9 Operatordoesnotuseorisactively movingawayfromusingpetroleumdistillates. Operatorensurestheintegrity of the casingtoreducetheriskofleakageoffracturingfluids, salineformationwaterorhydrocarbonsintoashallowaquiferduetoimperfectsealingofthe cement column around the casing. Operator ensures that wells are properly sealed before perforationandstimulation. 10 Operatorroutinely 11 testswellintegrityusingpressuretestingandothermethodsthatmeetor go beyond regulation such as temperature, acoustic, or ultrasonic and that take into account potentialdecreasesinwell?boreintegrityovertime. Uponcompletion,operatorensurestheintegrityofplugandabandonmentmeasuresandthe isolationoffreshwateraquifers. Reductionoftoxicityoffluidsused indrillingandcompletingwells, includingfluidsusedforhydraulic fracturing Integritysafeguards;existenceof properseals Well?boreintegrity 9 Hydraulicfracturingfluidsincludeallwellstimulationfluidsandgasesthatareusedtoenhancetheproductionofhydrocarbonsfromawell.Thisincludeshydraulic fracturing(withandwithoutproppants),waterandsteamflooding,gasfracking,acidfrackingandmatrixacidizing. 10 Thecementingofthecasingstringsisplannedandmonitoredtoensurethatthecasingformationannulusissealedcompletely,losszonesareaddressedeither mechanicallyorbyusinglowerdensityslurries. 11 Thefrequencyofsuchtestingisdeterminedbytheriskandseverityoflosingisolationandthehistoryoftheproducingareaincludingtheexperienceofother operators Equitable Origin Standards LLC Revision 2 Page 12 of 19

13 5.7&Air& Operatormitigatesriskofspillsatthesurfacethroughsecurestorageonsite,preferablyfully contained in stable, weather?proof storage facilities. Volumes are minimized by expedited treatment,recyclingordisposal. Operator verifies the location of aquifers prior to stimulation via hydraulic fracturing. Where appropriate,computersimulationsthatincludeallavailablegeologicinformation,thepresence of faults, stress regimes and the presence of existing wells, either active or abandoned, are performedtounderstandthepropagationandverticalgrowthoftheinducedfractures,taking into account the impact of the presence of wells and faults. Operator uses and discloses minimum?depthlimitationsonhydraulicfracturing,baseduponlocalhydrogeologicconditions. Minimum?depthlimitationsmeetorexceedlocalregulations. Operatorusesrecycled 12 waterandreuseswaterasmuchaspossible.operatorhasapolicyto usenon?potableorbrackishwaterwhenevertechnicallyfeasiblewithincostlimitations. Operatorstoresfluidstobeinjectedandflowbackwaterinclosedtanks.Operatordoesnotuse pitsorimpoundmentsforanyliquidotherthanfreshwater. Operatorreducesairemissionsfromdrilling,wellcompletion,transportationandrelatedproject infrastructureasmeasuredagainstpreviousyearsonaper?boebasis.wheredieseltrucksare partoftheoperationnearsettledareas,operatorencouragestheuseofultra?low?sulfurdiesel fuelsinlinewiththelowestavailablesulfurcontentfuelintheareaofoperation. Operatorusesbestmanagementpracticestocontroldust. Operatorensuresthatallequipmentonthewellpadisequippedforminimizingmethaneand otherairemissions 13,andconductsquarterlychecksofthisequipmenttoensureitisworking Integrityofwastewaterand producedwaterstoragefacilities Minimum?depthlimitations, isolationofwellsfromfreshwater aquifers Policyonnon?potable/recycled wateruse Useofclosedtanks;pitsusedonly forfreshwater Airemissionsrates;measuresto reducevocs,methanenox,sox fromtransportation 12 Recycledwateristhewastewaterfromflow?backoffracturingfluid.Itdoesnotincludethereleaseoftreatedwastestreamsbacktosurfacewaters Equitable Origin Standards LLC Revision 2 Page 13 of 19

14 5.11&Waste& Production&&& Management& 5.12&Spill& Prevention&&& Emergency& Preparedness& 5.13&Flaring& properlyaspartofasystematicleaddetectionandrepairprogram. Operator reduces discharge of flowback fluid through means such as reducing water use, recyclingofflowbackwaterandothermeans.operatorensuresthatdrillingwastesdonothave contactwithsurfacewaterorfreshgroundwater. Operator identifies and manages hazards from naturally occurring radioactive materials (NORM),includingsafehandling,storage,anddisposal. Operatorhasproceduresinplaceforrespondingtospillsandreleases,includinglocalexperts andspecialiststhataretechnicallyqualifiedtorespondtoemergenciesinatimelymanner. Wastegasisnotventedexceptforemergencypurposes.Nocombustiblegasisvented.Operator establishesagascaptureplanandeliminatesflaringfornewoperationsorprogressivelyreduces flaringofongoingoperations. 5.14&Monitoring& Operatorconductsbaselineandpost?completionsamplingofindividualwellsandsurfacewater withinaminimumradiusof2,500feet,orregulatorlimit,whicheverisgreater,priortodrillingof wellsandinstallsmonitoringwellstomonitorthequalityofwaterinaquifersinproductiveuse thatarebeingdrilledthrough.testingincludeslevelsofhydrocarbons,arsenic,mercuryand totaldissolvedsolidsinaquifersandsurfacestreams. Resultsofallbaselineandmonitoringtestsaremadeavailabletostakeholders. Regularreductionsofdischargeof wastewater;wastewater managementplan PracticestoaddressNORMrisks Emergencyresponseplans;onsite managementplansforincidences ofspillsandleaks Gasflaringandventing Baselineandongoingmonitoringof surfacewaterquality;baseline measurementsandongoing monitoringofchemicalsand methanegasingroundwater 13 Forexample,switchingfromhighorintermittentbleedtolow?bleedpneumatics,usingplungerliftsforliquidsunloading,andusingsolarpumpsinplaceofchemical injectionpumps Equitable Origin Standards LLC Revision 2 Page 14 of 19

15 Operatorundergoesanindependentreviewofgroundwatercontaminationusingqualified 14 independent,groundwatergeologists. 5.15&Reporting&&& Disclosure 15 & Operatormonitorsbaselineandongoingemissionslevels,includingvolatileorganiccompound (VOC),methaneandNOxemissionsfromoperations. Operatorchecksonatleastaquarterlybasisequipmentforleaksusingbestavailable measurementtechnologiesandfixesanyleaksdetectedaspartofaldarprogram. Operatorsystematicallyverifiesthequalityofthecompressors,seals,caps,vents,gasketsand valvestoensuretheydonotdeterioratethroughthelifeofthewell. Operatorpubliclydisclosesthecompositionoffracturingfluidsincludingthespecificchemical species,msdsnumbers,concentrationsandvolumesofchemicalstobeused,priortofracturing thewell(seealso5.6water).ifthereareanychangesinfracturingfluidsused,thenthe operatoralsopubliclydisclosesthecompositionoffracturingfluidsusedafterfracturing. Wheretradesecretprotectionisasserted,suchassertionsaremadepublicandsubstantiatedby apublicbody,wherepossibleandinaccordancewithnational,state,orotherapplicablelaw. Operatordisclosestotalwaterusesonaquarterlybasisforeachwellbysourceandtheamount Baselineandongoingmonitoringof endofpipeemissions Ongoingqualitymonitoringof seals,caps,vents,gasketsand valves Disclosureofchemicalcomposition ofandquantitiesinfracturingfluids priortofracturing Totalwaterusebysource;water 14 Fromanaccreditedacademicinstitutionwithappropriatebackgroundknowledge. 15 EO PerformanceTarget1states: IfOperatoruseshydraulicfluidsduringwellcompletionortostimulateproduction,Operatorpubliclydisclosesall componentsofthosefluids Equitable Origin Standards LLC Revision 2 Page 15 of 19

16 ofwaterusedtoproduceoneboe. Operator discloses volume of total fluids injected, volume of freshwater injected, volume of wastewater injected, volume of flowback water injected, and fluids recovered. Operator disclosesflowbackwaterandproducedwatervolumesanddisposalmethods. Operator discloses proportion of recycled water used in well drilling, production and completion. Operatordisclosesallmethaneemissionsfromproductionoperations. Operator discloses NOx and VOC emissions from well drilling, production and completion activities. Operator publicly reports progress in reducing volumes of toxic chemicals used, as well as substitutionofless?toxicchemicalsusedinitsoperations. Operator discloses the amount of fines issued and the number of sanctions ( Notices of Violation )forviolationofenvironmentallawsandregulations. OperatordisclosesthefrequencyofitsLDARprogram. 5.16&Remediation& of&environmental& Liabilities& Operator ensures that clean?up of ground and surface waters are an integral part of the remediation process to avoid degrading the water quality and to reduce the risk of environmentalliabilities. Operatorensuresremediationofsoil,whereaffected. Principle&6:&PROJECT&LIFE&CYCLE&MANAGEMENT& intensity;amountofflowback waterandamountofproduced water Proportionofrecycledwaterto non?recycledwaterused Methaneemissionsrates EmissionsofNOxandVOCs Quantitativedisclosureofprogress intoxicityreduction NumbersandamountsofNOVs andfines LDARmonitoringreports Remediationplanforgroundand surfacewater Remediationplanforsoil 2015 Equitable Origin Standards LLC Revision 2 Page 16 of 19

17 6.5&Economic,& Environmental&and& Social&Impact& Assessments 6.6&Secondary&and& Cumulative&Impacts& Operator assesses impacts, including GHG emissions, along the whole value chain of the extractionprocess machinery,trucks,energyuse,transportation,etc. andthroughallphases oftheproductioncycle. 16 Operatorassessespotentialnegativesocio?economicimpactsonlocalcommunitiesofalarge andsuddeninfluxoflabor,includingviolence,druguse,alcoholism,rape,inflation,availabilityof affordablehousingetc.operatordevelopsmitigationmeasuresincollaborationwithauthorized representativesoftheaffectedcommunityandlocalgovernmentssuchasthedesignof temporaryworkercamps,communityprogramsandculturalsafeguardstoreducepotential negativeimpactsandaugmentpositiveimpacts. Operatorevaluatesthecumulativeandregionalimpactsofmultipledrillingandproduction operationsontheenvironment,notablyonwateruseanddisposal,landuse,airquality,traffic andnoise;andtheindirectimpactsofaninfluxofworkersonlocalinfrastructure.operator worksincollaborationwithotheroperatorsandwithauthorizedrepresentativesoftheaffected communityandlocalgovernmentstodevelopcollectivemitigationmeasures. Operatorevaluatestheimpactsofnewwellsinlightofexistingimpactsidentifiedthrough monitoringactivitiesidentifiedin5.14and6.5above. * * * Lifecycleimpactassessments Impactassessmentsinclude baselinesocio?economicindicators andmitigationmeasures Evaluationofcumulativerisksand impacts Evaluationofimpactsofnewwells 16 Notincludingenduse Equitable Origin Standards LLC Revision 2 Page 17 of 19

18 BACKGROUND*REFERENCES:** BattlementMesaHealthImpactAssessment,GarfieldCounty,Colorado,2011, county.com/environmentalehealth/battlementemesaehealtheimpacteassessmentedraft2.aspx CenterforSustainableShaleDevelopmentPerformanceStandards: content/uploads/2014/06/cssd_performanceestandardsev.e1.2.pdf CommunityEngagementGuidelines,AmericanPetroleumInstitute,July2014: DisclosingtheFacts2014:TransparencyandRiskinHydraulicFracturingOperations,AsYouSow,BostonCommonAsset Management,GreenCenturyCapitalManagement,andtheInvestorEnvironmentalHealthNetwork,December2014: EarthquakesInducedbyHydraulicFracturinginPolandTownship,Ohio,Skoular,Robert,etal.,BulletinoftheSeismological SocietyofAmerica,January2015: GlobalShaleGasDevelopment:WaterAvailabilityandBusinessRisks,WorldResourcesInstitute,September2014: GoldenRulesforaGoldenAgeofGas,WorldEnergyOutlookSpecialReportonUnconventionalGas,InternationalEnergy Agency,2012: Goodpracticeguidelinesforthedevelopmentofshaleoilandgas,OGPandIPIECA,December2013: HydraulicFracturing&WaterStress:WaterDemandbytheNumbers,CERES,2013: MeasurementsofmethaneemissionsatnaturalgasproductionsitesintheUnitedStates,DavidT.Allen,Proceedingsofthe NationalAcademyofSciences,Vol.110no.44,August2013: NaturalGasOperationsfromaPublicHealthPerspective,T.Colbornetal.HumanandEcologicalRiskAssessment:An InternationalJournalVolume17,Issue5,2011: ublic%20health%20perspective.pdf 2015 Equitable Origin Standards LLC Revision 2 Page 18 of 19

19 NoblegasesidentifythemechanismsoffugitivegascontaminationindrinkingEwaterwellsoverlyingtheMarcellusand BarnettShales,ThomasH.Darrahetal.,ProceedingsoftheNationalAcademyofSciences,Vol.111no.39,August2014: OilandGasatYourDoor?ALandowner sguidetooilandgasdevelopment,oil&gasaccountabilityproject,july2005: OilandNaturalGasSector:StandardsofPerformanceforCrudeOilandNaturalGasProduction,Transmission,and Distribution,USEPA,July2011: ShaleGasRoundtable:Deliberations,Findings,andRecommendations,UniversityofPittsburgh,August2013: PennsylvaniaEnergyImpactsAssessment,NelsJohnson,TheNatureConservancy,November2010: Physical,chemical,andbiologicalcharacteristicsofcompoundsusedinhydraulicfracturing,Stringfellowetal.,Journalof HazardousMaterialsVol.275,June2014: PublicHealthRisksofShaleGasDevelopment,byJohnL.Adgateetal.ColoradoSchoolofPublicHealth,Universityof ColoradoDenver;UniversityofPittsburghGraduateSchoolofPublicHealth ShalegasdevelopmentimpactsonsurfacewaterqualityinPennsylvania,Olmsteadetal.,ProceedingsoftheNational AcademyofSciences,Vol.110no.13,March2013: Unsafe&Unsustainable:ExpertsReviewtheCenterforSustainableShaleDevelopment sperformancestandardsforshalegas Development,DelawareRiverkeeper,December2014: * 2015 Equitable Origin Standards LLC Revision 2 Page 19 of 19