Environmental, Social and Governance (ESG) Due Diligence Evaluation

Project Detail:

In support of our client’s evaluation of potential assets for acquisition and as part of their M&A Program, Ensolum was tasked with conducting a desktop due diligence review.  The Scope of Work for this project was to identify potential environmental liabilities to allow our client to assess the value and quality of the assets prior to acquisition.  The specific owner/operator of the assets under review uses a corporate identity of a “Basin Leader” and “Best-In Class” to brand themselves as leaders in ESG.  This due diligence review therefore included evaluation of the asset and operating company’s ESG data and included comparisons to our client’s own ESG metrics to assist in the asset evaluation.  To complete this work Ensolum acquired publicly available data from state agencies for oil, gas, and water production.  We also acquired publicly available data of annual greenhouse gas emissions from the EPA including equipment information and emissions analysis.  The results allow our client to see this data visually, to help with the understanding of the differences in assets regarding their production profiles, emissions, ongoing equipment replacement program, and efficiency intensities.  This data is used by our client to help understand the value of the assets in question, and how these assets will affect the client’s own ESG metrics and ultimately their company portfolio.  To date, the acquisition has not closed.