Offshore drilling rig contractors in the EU will from 2023 be required to report on sustainability performance. While reporting standards are set to be defined, it is very likely drilling players would very soon have to publicly disclose their impact on the environment, Norwegian analyst Esgian said.
Nearly 50,000 companies will need to follow the detailed EU Corporate Sustainability Reporting Directive (CSRD), including an extensive number of offshore drilling and installation services companies, which previously have not been subject to reporting requirements on sustainability or emissions.
According to Esgian’s offshore rig emissions analytics database, North Sea-based rigs alone contributed 1.6m tonnes of CO2 over the past 12 months and are the second highest producer of CO2 emissions globally, only second to the Middle East.
The Commission has not yet proposed any specific reporting standards or parameters. However, based on the recommendations from the European Financial Reporting Advisory Group (EFRAG), Esgian believes that CO2 emissions will become one of the standards that will be established for drilling companies under the CSRD from 2023.
The first set of standards is to be adopted by October 2022, followed by the second, probably by October 2023. Companies regulated under the CSRD are required to report under the new standards from 2023 onwards, meaning for reports published from 2024.
The Commission will present further details around reporting standards under the CSRD within the next couple of months.