Climate

Climate strategy

We believe that LNG has a critical role to play in meeting the world’s energy needs, improving air quality and supporting the transition to a lower-carbon future. Cheniere’s climate strategy is to maximize the environmental benefits of our LNG through two critical and complementary components of GHG emissions management: measurement and mitigation.

We have taken a data-driven approach that leverages our unique position within the LNG supply chain to collaborate with our suppliers, scientific experts and customers to improve the climate competitiveness of our LNG and strengthen the resilience of our business over the long term. To that end, we believe that a reliable and holistic assessment of the GHG emissions profile of our LNG operations and supply chain is crucial to inform our investments in strategic and cost-effective opportunities to improve our GHG emissions performance.

Our recently announced, measurement-informed annual methane emissions intensity target is the latest example of Cheniere’s climate strategy in action. This voluntary Scope 1 emissions intensity target of 0.03% per tonne of LNG produced across Cheniere’s two Gulf Coast liquefaction assets by 2027 leverages data from our emissions measurement and mitigation programs and is consistent with the requirements to achieve Gold Standard under Cheniere’s membership in the United Nations Environment Programme’s (UNEP) Oil & Gas Methane Partnership (OGMP) 2.0.

Programs supporting our climate strategy involve transparent collaboration with members of our supply chain, enabling our stakeholders to better understand the emissions profile of the LNG we deliver and to identify opportunities to improve emissions performance. By providing business partners with actionable emissions data, we are supporting opportunities for improved emissions performance beyond our immediate operations. We believe this strategy is how we can add the most effective and immediate climate value as we help to meet the world’s energy needs.

Measurement

Cheniere is advancing tools and methods that generate actionable measurement data to directly inform mitigation actions and allow reliable verification of data. An emphasis on measurement will also help prepare us for the increasing focus of domestic and international policymakers on measured data. 

  • We developed our life cycle assessment model, which provides a supplier-specific emissions profile of our LNG supply chain, as the foundational analytical tool for our climate strategy. 
  • Our Quantification, Monitoring, Reporting and Verification (QMRV) R&D project, which was initiated in 2021 to improve the understanding of GHG emissions through the deployment of advanced monitoring technologies and protocols, was completed in 2023. Results have been published in multiple peer-reviewed academic papers, available in our Report Center.

Mitigation

Our efforts to more accurately measure supply chain GHG emissions are helping us build a data-driven approach that leverages our unique position within the LNG supply chain. We collaborate with our suppliers, scientific experts and customers to improve the climate competitiveness of our LNG and strengthen the resilience of our business over the long term. As we help develop decision-useful emissions information to provide the foundation for effective and targeted long-term mitigation strategies, we are also focusing on what we can do right now to minimize and mitigate our environmental impacts. A few examples of this are

  • Our QMRV project and long-term measurement strategy helps to detect methane leaks via multiple measurement and detection technologies.
  • The CCL Stage 3 expansion project, currently under construction, is electric drive. This capacity expansion will therefore likely improve our corporate Scope 1 GHG intensity.
  • We have initiated front-end engineering design for the inclusion of accommodations for a carbon capture and storage (CCS) project in the regulatory filings for our SPL expansion project. 
  • Focus on operational efficiency.

More information about our measurement and mitigation programs can be found in the Climate section of our Corporate Responsibility Report.

We have built our strategy to respond to climate-related risks and opportunities, support the long-term resilience of our business and address the world’s shared energy challenges. We regularly assess these risks and opportunities through our enterprise risk assessment (ERA), climate-specific scenario analysis and other processes and are committed to managing the risks and opportunities we identify. We integrate climate-related risks and opportunities into our business strategy and financial planning. We have also conducted a series of engagements with key external stakeholders, including our largest investors and lenders, to better understand their perspectives on the most important risks and opportunities for our business.

We incorporate climate-related risks and opportunities as a discrete component of our annual ERA process, which is overseen by our Chief Risk Officer (CRO) and reviewed by the Board of Directors. Our ERA process focuses on identifying short- and medium-term risks within a 5-year time horizon, including their related potential financial and reputational impacts. We undertake our ERA process annually, with a midyear review, to determine if there have been any significant changes in the risks identified, potential impacts or mitigating measures.

Cheniere’s Board of Directors oversees the development and execution of our climate strategy and regularly reviews progress. Although the full Board is actively engaged on climate issues, the Governance and Nominating Committee has the formal responsibility of reviewing climate strategy, performance and progress. The Audit Committee oversees Cheniere’s ERA process, which includes consideration of climate-related risks. Members of the leadership team including our SVP of PGPA provide updates to the Board and relevant committees on climate-related risks and opportunities, as well as Cheniere’s climate strategy and performance, at least quarterly. 

Subject to the formal oversight of our Board of Directors, our executive leaders are directly responsible for identifying, assessing and managing climate-related risks and opportunities, and implementing our climate strategy. The SVP of Corporate Development and Strategy and SVP of PGPA lead the development and execution of our climate strategy. Executives across our business functions, including Finance, Commercial, Trading, Gas Supply and Operations, help guide this effort. Our executive leadership report directly to our CEO on climate strategy and planning on a regular basis.

For more information, see Managing climate-related risks and opportunities.

In 2022, Cheniere began providing our long-term customers with Cargo Emissions Tags (CE Tags) showing the estimated GHG emissions associated with each cargo produced at our facilities. The CE Tags are calculated from our supplier-specific life cycle assessment (LCA) model and provide a value chain emissions estimate from wellhead to point of delivery, supplying our customers with actionable information about life cycle emissions and an input to better understand their own Scope 3 emissions profile. CE Tags are calculated utilizing Cheniere’s LCA model. They are not a claim of a specific ​“differentiated” or ​“certified” or ​“responsible” LNG product, nor has Cheniere transacted in the commercialization of such products.