module: introduction · groundwater - renewable 38089 higher oxy does not differentiate between...

1

CDP CDP 2017 Water 2017 Information Request

Occidental Petroleum Corporation

Module: Introduction

Page: W0. Introduction

W0.1

Introduction

Please give a general description and introduction to your organization

Occidental Petroleum Corporation's (Oxy's) principal businesses consist of three segments: (1) oil and gas exploration and production; (2) midstream and marketing; and, (3) chemicals (OxyChem). The oil and gas segment explores for, develops and produces crude oil and condensate, natural gas liquids (NGL) and natural gas. The midstream and marketing segment gathers, processes, transports, stores, purchases and markets oil, condensate, NGLs, natural gas and carbon dioxide (CO2), and generates power. OxyChem is a leading manufacturer of PVC resins, vinyls, chlorine and caustic soda – key building blocks to life-enhancing products such as pharmaceuticals, water treatment chemicals, building materials and plastics. The production of oil and gas, electricity and chemicals requires water, and Oxy understands the importance of managing water resources responsibly. Occidental's water management program is designed to conserve and protect water resources in communities where we operate by optimizing the use of low-quality produced water, the recycling of water and limiting the use of freshwater used for drinking water supplies. OxyChem, as an American Chemistry Council Responsible Care® company, is committed to reporting on its water management practices and consumption.

W0.2

Reporting year

Please state the start and end date of the year for which you are reporting data

Period for which data is reported

Fri 01 Jan 2016 - Sat 31 Dec 2016

2

W0.3

Reporting boundary

Please indicate the category that describes the reporting boundary for companies, entities, or groups for which water-related impacts are reported

Companies, entities or groups over which operational control is exercised

W0.4

Exclusions

Are there any geographies, facilities or types of water inputs/outputs within this boundary which are not included in your disclosure?

No

W0.4a

Exclusions

Please report the exclusions in the following table

Exclusion

Please explain why you have made the exclusion

Further Information

Module: Current State

Page: W1. Context

W1.1

3

Please rate the importance (current and future) of water quality and water quantity to the success of your organization

Water quality and

quantity

Direct use importance

rating

Indirect use importance

rating

Please explain

Sufficient amounts of good quality freshwater available for use

Vital for operations

Important

It is important to Oxy that we use all sources of freshwater responsibly. Where possible, Oxy does not use freshwater resources in conflict with local users. Oxy's oil production operations generate significant quantities of produced water (i.e., saline water from hydrocarbon reservoirs) which is often sufficient to meet the quantity of our needs. However, there are certain activities, such as hydraulic fracturing and water flooding for which the quality of recycled produced water is not sufficient. For those, Oxy requires freshwater. OxyChem’s business uses significant quantities of freshwater for production and cooling purposes, in addition to producing electricity. With respect to indirect use, freshwater is used to meet worker’s needs for cleaning and drinking purposes.

Sufficient amounts of recycled, brackish and/or produced water available for use

Important Not very important

With respect to direct use, Oxy’s oil and gas operations increasingly substitute freshwater resources with brackish/non-potable produced water, naturally occurring water that originates in the hydrocarbon reservoir and comes to the surface along with oil and gas during production. The extraction, processing, treatment and reinjection of produced water is integral to the design and efficient operation of Oxy’s mature oil and gas fields, including water flooding and EOR operations. In 2015, 60% of water needs were sourced using non-potable water in our U.S. upstream operations. In the Permian Basin, our oil and gas operations achieve close to 90%. At OxyChem, the manufacture of chlorine and caustic soda involves the extraction and processing of brine (saltwater) streams.

W1.2

For your total operations, please detail which of the following water aspects are regularly measured and monitored and provide an explanation as to why or why not

4

Water aspect

% of

sites/facilities/operations

Please explain

Water withdrawals- total volumes 76-100 Oxy operational facilities measure and monitor water withdrawals. For Oxy's oil and gas operations, essentially all brackish water is co-produced with oil and gas extracted from wells.

Water withdrawals- volume by sources

76-100 Oxy operational facilities measure and monitor water withdrawals by source.

Water discharges- total volumes 76-100 Oxy operational facilities measure and monitor water discharge volumes.

Water discharges- volume by destination

76-100 As required by regulations, operational facilities measure and monitor discharges by destination.

Water discharges- volume by treatment method

26-50 As required by regulations, OxyChem facilities measure and monitor discharges by treatment method.

Water discharge quality data- quality by standard effluent parameters

76-100 As required by regulations, operational facilities measure and monitor discharges by waste and effluent parameters.

Water consumption- total volume 76-100 OxyChem and Oxy's oil and gas facilities measure and track water consumption.

Facilities providing fully-functioning WASH services for all workers

76-100 All Oxy offices, field camps, OxyChem and oil and gas facilities provide adequate water facilities for potable uses, sanitation and hygiene.

W1.2a

Water withdrawals: for the reporting year, please provide total water withdrawal data by source, across your operations

Source

Quantity

(megaliters/year)

How does total water withdrawals for this

source compare to the last reporting year?

Comment

Fresh surface water 0.00 About the same Oxy does not measure surface fresh water withdrawals across all operations, at this time.

Brackish surface water/seawater

101986 About the same

5

Source

Quantity

(megaliters/year)

How does total water withdrawals for this

source compare to the last reporting year?

Comment

Rainwater 0.00 Not applicable Oxy does not measure rainwater withdrawals across all operations, at this time.

Groundwater - renewable 38089 Higher Oxy does not differentiate between renewable/non-renewable groundwater

Groundwater - non-renewable

0.00 Not applicable Oxy does not differentiate between renewable/non-renewable groundwater

Produced/process water 366176 Higher

Municipal supply 27 About the same

Wastewater from another organization

0.00 Not applicable Source category not applicable to Oxy's operations.

Total 506278 Higher Total water withdrawals were higher mostly due to the greater use of water for hydraulic fracturing in our U.S. upstream businesses.

W1.2b

Water discharges: for the reporting year, please provide total water discharge data by destination, across your operations

Destination

Quantity

(megaliters/year)

How does total water

discharged to this destination compare to the last reporting

year?

Comment

Fresh surface water 95966 About the same

Brackish surface water/seawater 86469 About the same

Groundwater 309942 About the same

Municipal/industrial wastewater treatment plant

.71 About the same

Wastewater for another organization 5020 About the same

6

Destination

Quantity

(megaliters/year)

How does total water

discharged to this destination compare to the last reporting

year?

Comment

Total 497397 About the same Total water discharges remained relatively flat across our operations.

W1.2c

Water consumption: for the reporting year, please provide total water consumption data, across your operations

Consumption

(megaliters/year)

How does this consumption

figure compare to the last reporting year?

Comment

0.00 About the same Total water consumption remained relatively flat across our operations. Oxy’s more efficient use of global water resources partly offset the greater use of water for hydraulic fracturing in our U.S. upstream businesses.

W1.3

Do you request your suppliers to report on their water use, risks and/or management?

No

W1.3a

Please provide the proportion of suppliers you request to report on their water use, risks and/or management and the proportion of your procurement spend this represents

7

Proportion of suppliers %

Total procurement spend %

Rationale for this coverage

W1.3b

Please choose the option that best explains why you do not request your suppliers to report on their water use, risks and/or management

Primary reason

Please explain

Judged to be unimportant

Oxy considers environmental management criteria as part of the comprehensive assessment it conducts when sourcing and selecting suppliers. Oxy is not engaged with retail commodity markets/consumers. At this time, there is insufficient value to Oxy in screening suppliers for reporting their organizational water consumption and risks. We continue to monitor these risks as operating parameters or local market conditions could change.

W1.4

Has your organization experienced any detrimental impacts related to water in the reporting year?

No

W1.4a

Please describe the detrimental impacts experienced by your organization related to water in the reporting year

8

Country

River basin

Impact driver

Impact

Description of impact

Length of impact

Overall

financial impact

Response strategy

Description of

response strategy

W1.4b

Please choose the option below that best explains why you do not know if your organization experienced any detrimental impacts related to water in the reporting year and any plans you have to investigate this in the future

Primary reason

Future plans

Further Information

Module: Risk Assessment

Page: W2. Procedures and Requirements

W2.1

Does your organization undertake a water-related risk assessment?

Water risks are assessed

W2.2

Please select the options that best describe your procedures with regard to assessing water risks

9

Risk assessment

procedure

Coverage

Scale

Please explain

Comprehensive company-wide risk assessment

Direct operations

All facilities

As part of Occidental's Health, Environment and Safety Management System (HESMS), our programs, standards and operational strategies designed to conserve water resources, such as improving efficient use, recycling and reuse of water and the quality of water being treated and discharged to surface water bodies. We assess other risk parameters that focus on the unique characteristics of each community and location of operations. Oxy uses industry-tested water risk tools (e.g., IPIECA Global Water Tool, GEMI Local Water Tool for Oil and Gas, WRI Aqueduct) to supplement our assessment findings. Assessments are also conducted as-needed to address changes in operations, site conditions or regulations.

W2.3

Please state how frequently you undertake water risk assessments, at what geographical scale and how far into the future you consider risks for each assessment

Frequency

Geographic

scale

How far into the future are risks

considered?

Comment

Annually Facility 1 to 3 years

An initial assessment is conducted prior to exploration in a new region. Water is integrated into a comprehensive, company-wide risk assessment process incorporating direct operations only. Minor incidental uses, such as in office buildings, are not included. Oxy's Health, Environment and Safety Management System (HESMS) requires an assessment of potential environmental effects at all new operations.

Every two years

Region 3 to 6 years

Facility or local level water risk assessments are cross referenced against longer-term (3-5 years, or longer) regional demographic and economic growth forecasts and risk of severe weather occurrences - i.e., drought, flooding and severe storm vulnerability - that potentially impacts staffing and our operational assets.

W2.4

10

Have you evaluated how water risks could affect the success (viability, constraints) of your organization's growth strategy?

Yes, evaluated over the next 1 year

W2.4a

Please explain how your organization evaluated the effects of water risks on the success (viability, constraints) of your organization's growth strategy?

Oxy considers the longer-term patterns of integrated water resources management, regenerative capacity of ground water and aquifers, population growth/demand shifts and the potential for weather related impacts to evaluate and mitigate the effects of water risks on key operations and the safety and well-being of employees and contractors. When evaluating a new site or asset, this involves evaluating legal and regulatory issues and hydrological yield in terms of the reliability and proximity of other water users during exploration and production activities. Oxy's analysis of water-related risks includes an information-gathering process, environmental due diligence, participation in industry association work groups (for example, IPIECA Water Working Group and the American Chemistry Council Responsible Care) and external stakeholder engagement to inform and refine our risk management and strategic planning processes. Water risk is evaluated based on the importance of water to an operation, and importance depends in part on how easily a particular source could be replaced with an alternate source, and technological feasibility and viability. The evaluation also involves considering both quantity and quality characteristics of the source in use and of the potential alternatives. The importance level is factored into the risk identification and management process. An example is OxyChem's role in the Vinyl Institute’s Vinyl Business and Sustainability Council. As part of this Council, OxyChem and other members are engaging with stakeholders to address perceptions of the industry’s water management and water re-use practices to further explore risks and opportunities to our vinyls business. The Council can apply a life-cycle benefits/costs approach to the production of higher-value vinyl products, such as in building materials and medical products. Another example is Oxy’s executive-level position, Director of Water Strategy, created in late 2016. The Director of Water Strategy manages the oil and gas development plans in an integrated and collaborative manner, across different business assets and geographic basins. The goal is to grow the business through the application of a full-cycle, cost-efficient water management program focused on smart sourcing of water, the recycling and re-use of produced water and environmentally sound treatment and disposal.

W2.4b

What is the main reason for not having evaluated how water risks could affect the success (viability, constraints) of your organization's growth strategy, and are there any plans in place to do so in the future?

Main reason

Current plans

Timeframe until evaluation

Comment

11

W2.5

Please state the methods used to assess water risks

Method

Please explain how these methods are used in your risk assessment

CEO Water Mandate's 'Understanding Key Water Stewardship Terms' GEMI Local Water Tool IPIECA Global Water Tool for Oil & Gas Regional government databases WRI Aqueduct Other: World Economic Forum (WEF) Global Risks

Oxy’s water risk management approach assesses the risks and compliance measures associated with sourcing water in terms of adequate quantity and quality, the protection of water resources (e.g. proper well design and integrity), efficient use of water (reuse and recycling), and the disposal of wastewater and/or solid wastes. A variety of industry, scientific and third-party tools and risk assessments are used to cross-reference our internal HESMS risk management process. These external resources provide useful input and interject analyses and critical thinking that Oxy may not have considered relevant at the facility or business unit level. This is used for all our operations.

W2.6

Which of the following contextual issues are always factored into your organization's water risk assessments?

Issues

Choose option

Please explain

Current water availability and quality parameters at a local level

Relevant, included

Water quantity and quality parameters are factored into Oxy's risk management approach and HESMS. Occidental recognizes the localized nature of water management issues, as such, it may not be relevant to compare water risk parameters from one site to another because the availability and quality of water sources, as well as the demand for those water sources, varies significantly from place to place.

Current water regulatory frameworks and tariffs at a local level

Relevant, included

Current regulatory frameworks and tariffs at the local and municipal level are factored into our HESMS and water risk assessments.

12

Issues

Choose option

Please explain

Current stakeholder conflicts concerning water resources at a local level

Relevant, included

Oxy always seeks to optimize water from non-potable sources, using the lowest-quality water acceptable for operational activities, and recycles produced water and wastewater wherever feasible to avoid using water resources in conflict with local stakeholders.

Current implications of water on your key commodities/raw materials

Not relevant, included

Water risks on our raw materials are sufficiently addressed through diversity and security of suppliers.

Current status of ecosystems and habitats at a local level

Relevant, included

Local ecosystem and watershed impacts are factored into our HESMS and water risk assessments. In many operations, Oxy has set aside habitat conservation areas or has contributed to local and regional habitat conservation efforts.

Current river basin management plans Not relevant, explanation provided

River basin management plans are considered, if robust and available. The use of external risk assessments and spatial modelling tools (WRI Aqueduct, IPIECA Global Water Tool) can substitute for government sponsored river basin plans.

Current access to fully-functioning WASH services for all employees

Relevant, included

Oxy ensures adequate water is available for drinking, cleaning and hygiene at each of its facilities and field operations.

Estimates of future changes in water availability at a local level

Relevant, included

Future estimates of local water supply/demand are assessed as part of our HESMS. Occidental's supplemental use of tools such as the WRI Aqueduct and GEMI LWT is consistent with this approach.

Estimates of future potential regulatory changes at a local level

Relevant, included

Water-related risk to Oxy’s supply chain is relatively small. Oxy’s oil and gas facilities do not rely extensively on a supply chain. The raw materials and finished goods that Oxy’s oil and gas and chemical operations use can generally be sourced from multiple geographic areas, which mitigates the risk of water-related effects on the supply chain.

Estimates of future potential stakeholder conflicts at a local level

Relevant, included

Occidental assesses potential future risks and impacts to local ecosystems and watersheds. Occidental's supplemental use of tools such as the WRI Aqueduct and GEMI LWT is consistent with this approach.

Estimates of future implications of water on your key commodities/raw materials



Estimates of future potential changes in the status of ecosystems and habitats at a local level

Relevant, included

Oxy assesses potential future risks and impacts to local ecosystems and watersheds. Occidental's supplemental use of tools such as the WRI Aqueduct and GEMI LWT is consistent with this approach.

Scenario analysis of availability of sufficient quantity and quality of water relevant for your operations at a local level

Relevant, included

Oxy assesses the long-term trends of water supply and quality. The supplemental use of tools such as the WRI Aqueduct, WEF Risk Reports and GEMI LWT is consistent with this approach.

Scenario analysis of regulatory and/or tariff changes at a local level

Relevant, included

Oxy assesses the future potential regulatory impacts or changes in tariffs, as practical.

13

Issues

Choose option

Please explain

Scenario analysis of stakeholder conflicts concerning water resources at a local level

Relevant, included

Future estimates of stakeholder needs are assessed as part of our HESMS, using the GEMI LWT and public engagement to avoid using water resources in conflict with local stakeholders.

Scenario analysis of implications of water on your key commodities/raw materials



Scenario analysis of potential changes in the status of ecosystems and habitats at a local level

Relevant, included

Oxy assesses potential future risks and impacts to local ecosystems and watersheds. Occidental's supplemental use of tools such as the WRI Aqueduct and GEMI LWT is consistent with this approach.

Other

W2.7

Which of the following stakeholders are always factored into your organization's water risk assessments?

Stakeholder

Choose option

Please explain

Customers Not relevant, explanation provided

Customers are not factored into Oxy's water risks assessments. Oxy produces and markets commodity petroleum products and chemicals that are not branded or consumer end goods.

Employees Relevant, included Employees and contractors are factored into Oxy's water risks assessments.

Investors Relevant, included Investors are factored into Oxy's water risks assessments and are part of Oxy's engagement with investors to disclose risks and water management performance.

Local communities Relevant, included Local communities are factored into Oxy's water risks assessments and are part of Oxy's engagement with stakeholders to inform the public about our water management practices and performance.

NGOs Not relevant, explanation provided

Oxy may factor relevant research and water related risks by NGOs. Typically, Oxy engages with these NGOs on broader issues as part of our stakeholder engagement.

Other water users at a local level

Relevant, included Other local water users are factored into Oxy's water risks assessments.

14

Stakeholder

Choose option

Please explain

Regulators Relevant, included Regulators are factored into Oxy's water risks assessments.

River basin management authorities

Relevant, included River basin management authorities, where they exist, are factored into Oxy's water risks assessments. Typically, these agencies are factored as part of the overall regulatory and operating environment.

Statutory special interest groups at a local level

Relevant, included Special interest groups, if relevant to a local region, are factored into Oxy's water risks assessments and part of Oxy's stakeholder engagement.

Suppliers Relevant, included Commercial suppliers do not present a consequential risk to Oxy's operations. However, Oxy’s access to water resources, secured though local water rights, are closely managed. Oxy monitors the market conditions and vulnerability of suppliers to water risks, and can adjust our assessment accordingly.

Water utilities at a local level

Relevant, included Water/waste water utilities are factored into Oxy's water risks assessments.

Other

W2.8

Please choose the option that best explains why your organisation does not undertake a water-related risk assessment

Primary reason

Please explain

Further Information

Module: Implications

Page: W3. Water Risks

W3.1

15

Is your organization exposed to water risks, either current and/or future, that could generate a substantive change in your business, operations, revenue or expenditure?

Yes, direct operations only

W3.2

Please provide details as to how your organization defines substantive change in your business, operations, revenue or expenditure from water risk

Water quality and quantity both represents risks and opportunities. Water is used throughout the project life-cycle of oil and gas activities, for our chemical production and power generation and is core to business continuity. Oxy's HESMS and risk management approach identifies, assesses and grades significant (actual and potential) water-related risks. The HESMS sets consistent worldwide performance expectations and standards across each business segment's respective operations. The HESMS facilitates compliance with laws and regulations and the management of HES and water risks to improve overall business performance. Oxy manages its own water use consistent with community interests near our operations and to avoid adversely impacting the environment, or our license to operate in these communities. Oxy works with IPIECA, the global oil and gas industry association for environmental and social issues. Through a combination of practical tools, reporting practices and working group forums for sharing industry knowledge, IPIECA enables the oil and gas industry to proactively identify potential water risks and to manage water issues. For example, water scarcity is a prominent issue in the Permian Basin (West Texas and Southeast New Mexico) where, as reported by the U.S. Geologic Society and Texas Alliance, the majority of oil and gas wells are in a “high or extremely high water stress area.” These prevailing water scarcity risks are factored into Oxy’s business plans and water use strategy to operationalize and mitigate risks, and also to identify and seize opportunities that could provide costs savings or generate revenues. Our current oil and gas development plans factor the risk associated with future scarcity of fresh water, especially in Southeast New Mexico. Investing in solutions to treat a larger capacity of produced water delivers value to our operations. We mitigate safety-related risks and save money from minimizing the handling/trucking of water, disposal costs and providing operational continuity to treat large volumes of water if a disposal system goes down. Oxy’s social responsibility website and the Form 10-K provides a detailed discussion of risk factors, including those which can be water-related such as governmental actions, climate change and catastrophic events (hurricanes, floods and droughts).

W3.2a

Please provide the number of facilities* per river basin exposed to water risks that could generate a substantive change in your business, operations, revenue or expenditure; and the proportion of company-wide facilities this represents

16

Country

River basin

Number of facilities

exposed to water risk

Proportion of

company-wide facilities that this

represents (%)

Comment

United States of America

Colorado River (Caribbean Sea)

14 31-40 Hobbs/Midland/Odessa region, Permian Basin (Southwest Texas, Southeastern New Mexico)


Mississippi River 5 1-5 OxyChem plants


Other: Houston Ship Channel/Gulf of Mexico

5 6-10 OxyChem plants, Ingleside Power Station and Occidental corporate hq

Colombia Other: Aruaca River 3 1-5 Llanos Norte Basin operations

Colombia Other: Middle Magdalena Basin

2 1-5 La Cira Infantas operations

W3.2b

For each river basin mentioned in W3.2a, please provide the proportion of the company's total financial value that could be affected by water risks

Country

River basin

Financial reporting

metric

Proportion of

chosen metric that could be affected

Comment



% global production volume

6-10 Assuming a prolonged, severe drought similar to conditions in 2011 in W. Texas: Prices for water supplies are most at risk, but not necessarily access to water resources.


Mississippi River % global production volume

1-5 Chemicals production volumes (vinyls and PVC); power generation; product distribution to regional markets/terminals


Other: Houston Ship Channel/Gulf of Mexico


1-5 Chemicals production volumes (vinyls and PVC); power generation; product distribution to regional markets/terminals

17

Country

River basin

Financial reporting

metric

Proportion of

chosen metric that could be affected

Comment

Colombia Other: Aruaca River % global production volume

1-5 Llanos Norte Basin operations

Colombia Other: Middle Magdalena Basin


1-5 La Cira Infantas operations

W3.2c

Please list the inherent water risks that could generate a substantive change in your business, operations, revenue or expenditure, the potential impact to your direct operations and the strategies to mitigate them

Country

River basin

Risk driver

Potential impact

Description of potential impa

ct

Timeframe

Likelihood

Magnitude of

potential financial impact

Response strategy

Costs of response strategy

Details of

strategy and costs



Physical-Increased water scarcity Physical-Projected water stress Physical-Seasonal supply variability/Inter annual variability

Higher operating costs

Water scarcity is a prominent issue in the Permian Basin (West Texas and Southeast New Mexico) where, as reported by the U.S. Geologic Society and Texas Alliance,

1-3 years Probable Low-medium

Engagement with community Engagement with public policy makers Engagement with other stakeholde

Dependent on range of suppliers, technology solutions, access to water resources and level of

To manage the risk of potential higher operating costs, Oxy could allocate additional capital/ budget. Increase investment in treatment and use of lower

18

Country

River basin

Risk driver

Potential impact


ct

Timeframe

Likelihood

Magnitude of


Response strategy


Details of

strategy and costs

the majority of oil and gas wells are in a “high or extremely high water stress area.” As readily available water supplies diminish, costs to source and use water, particularly freshwater, will increase.

rs in the river basin Engagement with suppliers Infrastructure investment Increased investment in new technology Promote best practice and awareness Water management incentives

competition.

quality water resources (brackish/produced water).



Regulatory-Increased difficulty in obtaining withdrawals/operations permit Regulatory-Regulatory uncertainty Regulatory-Statutory water withdrawal

Higher operating costs

Regulatory risk, both at state and federal levels, is uncertain and, in some instances, contradictory with regards to compliance and permitting

1-3 years Probable Low

Alignment of public policy positions with water stewardship goals Engagement with public policy

Marginally higher costs due to staff time/due diligence

Oxy monitors current and proposed legislation that could affect its operations and costs of compliance.

19

Country

River basin

Risk driver

Potential impact


ct

Timeframe

Likelihood

Magnitude of


Response strategy


Details of

strategy and costs

limits/changes to water allocation

standards. For instance, U.S. Bureau of Land Management likely to limit the percentage of freshwater used for oil and gas drilling and completions.

makers Engagement with other stakeholders in the river basin Infrastructure investment Increased capital expenditure



Physical-Projected water scarcity Physical-Projected water stress Reputational-Community opposition Reputational-Negative media coverage

Loss of license to operate

Reputational risk may impact our effectiveness and credibility as a trusted community partner and loss of our social license to operate.

4-6 years Unlikely Low-medium

Alignment of public policy positions with water stewardship goals Engagement with community Engagement with public policy makers Engagement with other

No significant change in staff support and engagement costs envisaged.

Oxy actively and effectively engages local communities and water users to inform the public about our water management practices and performance.

20

Country

River basin

Risk driver

Potential impact


ct

Timeframe

Likelihood

Magnitude of


Response strategy


Details of

strategy and costs

stakeholders in the river basin Strengthen links with local community


Other: Houston Ship Channel/Galveston Bay/Gulf of Mexico

Physical-Ecosystem vulnerability Physical-Flooding Physical-Inadequate infrastructure Physical-Seasonal supply variability/Inter annual variability

Plant/production disruption leading to reduced output

Severe storms can cause widespread flooding and flash flooding across the Houston/Galveston causing property damage, and impacting distribution, roadways and other public infrastructure.

Current-up to 1 year

Unlikely Low-medium

Develop flood emergency plans Engagement with community Engagement with suppliers Infrastructure maintenance Supplier diversification

Nominal cost of staffing response and cost of insurance.

Oxy has emergency preparedness and action plans and coordinates its response activities with local and regional authorities and community stakeholders. Oxy staff and contractors are apprised of alerts and any action to mitigate storm and severe weather impacts.

W3.2d

21

Please list the inherent water risks that could generate a substantive change in your business operations, revenue or expenditure, the potential impact to your supply chain and the strategies to mitigate them

Country

River basin

Risk driver

Potential impact

Description of potential

impact

Timeframe

Likelihood

Magnitude of


Response strategy


Details of strategy

and costs

W3.2e

Please choose the option that best explains why you do not consider your organization to be exposed to water risks in your direct operations that could generate a substantive change in your business, operations, revenue or expenditure

Primary reason

Please explain

W3.2f

Please choose the option that best explains why you do not consider your organization to be exposed to water risks in your supply chain that could generate a substantive change in your business, operations, revenue or expenditure

Primary reason

Please explain

Judged to be unimportant

Oxy considers environmental management criteria as part of the comprehensive assessment it conducts when sourcing and selecting suppliers. Oxy is not engaged with retail commodity markets/consumers. At this time, there is insufficient value to Oxy in screening suppliers for reporting their organizational water consumption and risks. We continue to monitor these risks as operating parameters or local market conditions could change.

22

W3.2g

Please choose the option that best explains why you do not know if your organization is exposed to water risks that could generate a substantive change in your business operations, revenue or expenditure and discuss any future plans you have to assess this

Primary reason

Future plans

Further Information

Page: W4. Water Opportunities

W4.1

Does water present strategic, operational or market opportunities that substantively benefit/have the potential to benefit your organization?

Yes

W4.1a

Please describe the opportunities water presents to your organization and your strategies to realize them

Country or

region

Opportunity

Strategy to realize opportunity

Estimated timeframe

Comment

Company-wide

Competitive advantage Increased brand

Oxy actively and effectively engages local communities and water users to inform the public Oxy actively and effectively engages local


Oxy's commitment to using produced water from oil and gas reservoirs and other non-potable sources wherever feasible reduces our demand for freshwater. Oxy uses

23

Country or

region

Opportunity


Estimated timeframe

Comment

value Improved community relations Improved water efficiency Social licence to operate

communities and water users to inform the public about our water management practices and performance.

lessons learned from its engagement and its water stewardship practices to continuously improve management techniques and operational efficiencies.


Collective Action Competitive advantage Increased brand value Increased shareholder value Improved water efficiency Innovation Sales of new products/services

Oxy aims to leverage collaboration and knowledge sharing across operations to employ advanced production technologies and to enhance the efficiency of resource utilization.

1-3 years

Oxy continues to evaluate new opportunities and revenue streams for beneficial reuse of water, such as for our chemicals production, non-potable municipal, ecological or agricultural use. OxyChem participates in the Vinyl Institute’s Vinyl Business and Sustainability Council to first identify market opportunities for the use of higher-value vinyl products.

Company-wide

Carbon management Climate change adaptation Competitive advantage Cost savings Increased shareholder value Improved water efficiency Social licence to operate

Oxy can leverage an energy-water systems approach to build smarter, cost efficient water infrastructure. Oxy's operations employ advanced production technologies and control systems to enhance the efficiency of resource utilization, including both energy and water. Oxy also works with its service contractors to improve water efficiency.


Efficiency programs that save water will also save energy and vice versa. Energy and water efficiency can help achieve other objectives, such as emission reductions, water conservation and enhance our social license to operate with stakeholders. Oxy’s operations employ advanced production technologies and control systems to enhance the efficiency of resource utilization, including both energy and water. Oxy also is developing new or enhancing existing water-related technologies, including the treatment of produced water and wastewater streams. We also continue to evaluate new opportunities for beneficial reuse of water, such as for our chemicals production, non-potable municipal, ecological or agricultural use.

24

Country or

region

Opportunity


Estimated timeframe

Comment

Company-wide

Competitive advantage Ensuring supply chain resilience

Oxy actively manages its supplier base and works with its existing contractors to improve resilience from security of supply.


Oxy assesses risks to its value chain and actively manages its supplier base to improve resilience from security of supply.

Oman

Climate change adaptation Competitive advantage Cost savings Improved water efficiency Innovation Social licence to operate

Oxy's operations employ advanced production technologies and control systems to enhance the efficiency of resource utilization, including both energy and water. Oxy also works with its service contractors and supports local enterprises to innovate solutions for improved water efficiency, treatment and desalination.


Oxy is developing new or enhancing existing water-related technologies, including the treatment of produced water and wastewater streams.

Colombia

Climate change adaptation Collective Action Competitive advantage Improved community relations Improved water efficiency Innovation Social licence to operate

Oxy seeks to innovate solutions using natural ecosystems for improved water efficiency, fresh water filtration and retention.


Oxy works with local stakeholders to develop new ways to access safe drinking water sources for local communities, improving health conditions and bringing Oxy closer to the community, improving our relationships, and creating an atmosphere of trust.

W4.1b

Please choose the option that best explains why water does not present your organization with any opportunities that have the potential to provide substantive benefit

25

Primary reason

Please explain

W4.1c

Please choose the option that best explains why you do not know if water presents your organization with any opportunities that have the potential to provide substantive benefit

Primary reason

Please explain

Further Information

Module: Accounting

Page: W5. Facility Level Water Accounting (I)

W5.1

Water withdrawals: for the reporting year, please complete the table below with water accounting data for all facilities included in your answer to W3.2a

26

Facility reference

number

Country

River basin

Facility name

Total water withdrawals

(megaliters/year) at this facility

How does the total

water withdrawals at this facility compare to the last reporting

year?

Please explain

0.0 Oxy does not publicly disclose its water performance and management data, at the facility level.

Further Information

Page: W5. Facility Level Water Accounting (II)

W5.1a

Water withdrawals: for the reporting year, please provide withdrawal data, in megaliters per year, for the water sources used for all facilities reported in W5.1

Facility reference number

Fresh

surface water

Brackish surface

water/seawater

Rainwater

Groundwater (renewable)

Groundwater

(non-renewable)

Produced/process

water

Municipal

water

Wastewater

from another

organization

Comment

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Oxy does not publicly disclose its water performance and management data, at the facility level.

W5.2

Water discharge: for the reporting year, please complete the table below with water accounting data for all facilities included in your answer to W3.2a

27

Facility reference

number

Total water discharged

(megaliters/year) at this facility

How does the total water discharged at this facility

compare to the last reporting year?

Please explain


W5.2a

Water discharge: for the reporting year, please provide water discharge data, in megaliters per year, by destination for all facilities reported in W5.2

Facility reference number

Fresh

surface water

Municipal/industrial

wastewater treatment plant

Seawater

Groundwater

Wastewater for another

organization

Comment

0.0 0.0 0.0 0.0 0.0 Oxy does not publicly disclose its water performance and management data, at the facility level.

W5.3

Water consumption: for the reporting year, please provide water consumption data for all facilities reported in W3.2a

28

Facility reference

number

Consumption

(megaliters/year)

How does this

compare to the last reporting year?

Please explain


W5.4

For all facilities reported in W3.2a what proportion of their water accounting data has been externally verified?

Water aspect

% verification

What standard and methodology was

used?

Water withdrawals- total volumes Not verified

Water withdrawals- volume by sources Not verified

Water discharges- total volumes Not verified

Water discharges- volume by destination Not verified

Water discharges- volume by treatment method Not verified

Water discharge quality data- quality by standard effluent parameters

Not verified

Water consumption- total volume Not verified

Further Information

Module: Response

Page: W6. Governance and Strategy

W6.1

29

Who has the highest level of direct responsibility for water within your organization and how frequently are they briefed?

Highest level of direct

responsibility for water issues

Frequency of briefings

on water issues

Comment

Board of individuals/Sub-set of the Board or other committee appointed by the Board

Scheduled-annual

Oxy’s Environmental, Health and Safety Committee of the Board of Directors is briefed annually (and more frequently as needed) on water-related matters. This Committee provides oversight on health, environmental and safety issues of importance to the Company, including water management. The Board supports Oxy's efforts to enhance water conservation, to preserve natural habitat, the efficiency of water utilization and water re-use, and sound treatment and disposal of produced and waste water. Oxy routinely educates stockholders and other key stakeholders through voluntary reporting on water risks and corporate water management practices. At the operational level, Oxy integrates waster risks and climate change issues into business decision making through a multi-disciplinary committee of managers, several of whom meet directly with the Environmental, Health and Safety Committee of the Board of Directors.

W6.2

Is water management integrated into your business strategy?

Yes

W6.2a

Please choose the option(s) below that best explains how water has positively influenced your business strategy

Influence of water on business strategy

Please explain

Investment in staff/training New executive-level officer dedicated to water strategy will align business goals and seek to realize operating efficiencies.

Introduction of water management KPIs Tracking water management KPIs has allowed more effective water-related expense monitoring.

30


Please explain

Water resource considerations are factored into location planning for new operations

Consideration of water resources has fostered positive neighbor and community relationships and encouraged the diversification of water sources.

Water resource considerations are factored into new market exploration

Consideration of water resources has fostered constructive engagement and assessments of risks with stakeholders and encouraged the diversification of water sources.

Publicly demonstrated our commitment to water

Commitments and performance on water stewardship made public through stakeholder engagement and at Oxy's corporate website. Public consideration of water resources has fostered positive neighbor and community relationships.

Alignment of public policy positions with water stewardship goals

Wildlife Habitat Council, IPIECA, CEO Water Mandate, regulatory compliance

Exploration of environmental impact Applying Oxy's HESMS approach in concert with external water risk tools such as WRI Aqueduct, WRI GWT, IPIECA/GEMI LWT, World Economic Forum Risk Reports

Greater due diligence Holistic due diligence process including supply chain resiliency, cost of water, engagement with investors and community stakeholders (to maintain social license to operate).

W6.2b

Please choose the option(s) below that best explains how water has negatively influenced your business strategy


Please explain

No measurable influence

W6.2c

Please choose the option that best explains why your organization does not integrate water management into its business strategy and discuss any future plans to do so

31

Primary reason

Please explain

W6.3

Does your organization have a water policy that sets out clear goals and guidelines for action?

Yes

W6.3a

Please select the content that best describes your water policy (tick all that apply)

Content

Please explain why this content is included

Performance standards for direct operations Performance standards for supplier, procurement and contracting best practice Incorporated within group environmental, sustainability or EHS policy

Oxy’s HESMS encompasses our programs, standards, operational strategies and integrated planning designed to conserve natural resources, such as improving efficient use, recycling and reuse of water and the quality of water being treated and discharged to surface water bodies. Oxy’s water stewardship policies and performance are also publicly communicated online and through corporate reporting.

W6.4

How does your organization's water-related capital expenditure (CAPEX) and operating expenditure (OPEX) during the most recent reporting year compare to the previous reporting year?

32

Water CAPEX

(+/- % change)

Water OPEX

(+/- % change)

Motivation for these changes

-62 -30 Asset divestments in the U.S. combined with overall reduced well drilling activity and major projects deferments primarily responsible for reduced CAPEX in 2016. OPEX spending was less, reflecting quicker turnaround/maintenance, efficiencies from transportation, recycling and injection projects, but higher chemicals-related costs.

Further Information

Page: W7. Compliance

W7.1

Was your organization subject to any penalties, fines and/or enforcement orders for breaches of abstraction licenses, discharge consents or other water and wastewater related regulations in the reporting year?

No

W7.1a

Please describe the penalties, fines and/or enforcement orders for breaches of abstraction licenses, discharge consents or other water and wastewater related regulations and your plans for resolving them

Facility name

Incident

Incident

description

Frequency of occurrence

in reporting year

Financial impact

Currency

Incident

resolution

W7.1b

33

What proportion of your total facilities/operations are associated with the incidents listed in W7.1a?

W7.1c

Please indicate the total financial impacts of all incidents reported in W7.1a as a proportion of total operating expenditure (OPEX) for the reporting year. Please also provide a comparison of this proportion compared to the previous reporting year

Impact as % of OPEX

Comparison to last year

Further Information

Page: W8. Targets and Initiatives

W8.1

Do you have any company wide targets (quantitative) or goals (qualitative) related to water?

Yes, targets and goals

W8.1a

Please complete the following table with information on company wide quantitative targets (ongoing or reached completion during the reporting period) and an indication of progress made

34

Category of

target

Motivation

Description of target

Quantitative unit of

measurement

Base-line year

Target year

Proportion of target

achieved, % value

Absolute reduction of water withdrawals

Risk mitigation

Limiting water withdrawal, especially from potable and freshwater sources, as much as possible. Oxy reports on the performance of specific operations rather than companywide aggregate metrics.

% increase in recycling/reuse per facility

2012 2017 90%

Absolute reduction of water withdrawals

Cost savings

Limiting water withdrawal, especially from potable and freshwater sources, as much as possible. Oxy reports on the performance of specific operations rather than companywide aggregate metrics.

Other: US dollars 2012 2017 100%

Community engagement

Shared value

Stakeholder engagement is both a central activity at Oxy and a catalyst for continuous improvement in our social responsibility policies, practices and reporting. We are committed to building trust with our stakeholders through regular and transparent communication and positive community outreach, everywhere we operate.

Other: 100% of community stakeholders engaged

2016 2020 100%

W8.1b

Please describe any company wide qualitative goals (ongoing or reached completion during the reporting period) and your progress in achieving these

Goal

Motivation

Description of goal

Progress

Other: Alignment of water stewardship across regions, operations

Water stewardship

Perform a comprehensive water management assessment at each major oil and gas facility. The assessment includes the use of the Global Environmental Management Initiative's Local Water Tools (GEMI LWT) and facilitates consistent tracking and management of Oxy’s water use, discharge, and consumption to ensure that these are consistent with community interests near operations and do not adversely impact the environment.

Implemented and sustaining

35

Goal

Motivation

Description of goal

Progress

Engagement with suppliers to help them improve water stewardship

Cost savings Improve coordination of and gain efficiencies from Oxy's Integrated Planning and Procurement.

Established new position of Director of Water Strategy.

Strengthen links with local community

Recommended sector best practice

Disclose all hydraulic fracturing on FracFocus, a national registry that makes information about chemical ingredients, water use and other information available to the public. Since 2011, Oxy has and continues to disclose hydraulic fracturing both where required and voluntarily.

Implemented and sustaining.

Educate customers to help them minimize product impacts

Cost savings Minimize reliance on fresh water sources; capacity to treat produced water; avoidance of vendor-related trucking and disposal costs; converting waste into reusable material.

Implementing strategy with business-level managers, Integrated Planning.

Providing access to WASH in workplace

Risk mitigation All Oxy operations are required to provide workplace WASH access.


Providing access to WASH in local communities

Shared value In select operations, striving to assist local communities and governments with greater access to WASH.

Implementing and sustaining.

Watershed remediation and habitat restoration, ecosystem preservation

Risk mitigation

Minimizing the disturbance of wildlife habitat is a key tenet of our conservation efforts. Oxy’s remediation efforts improve the water quality and biological integrity and diversity of affected lands and watersheds.

Implemented and sustaining. Glenn Springs Holdings Inc., a subsidiary of Occidental, received the Tennessee Governor’s Award for Exceptional Environmental Stewardship in 2016 for its remediation of the Copper Basin, in Tennessee. Glenn Springs constructed passive and active water treatment systems, captured poor quality water for treatment, diverted water of good quality, enhanced vegetation and wildlife habitat and restored stream segments and wetlands.

Other: Engagement with investors

Brand value protection

Raise awareness about our Social Responsibility framework, including water stewardship performance and practices.


W8.1c

Please explain why you do not have any water-related targets or goals and discuss any plans to develop these in the future

36

Further Information

Module: Linkages/Tradeoff

Page: W9. Managing trade-offs between water and other environmental issues

W9.1

Has your organization identified any linkages or trade-offs between water and other environmental issues in its value chain?

Yes

W9.1a

Please describe the linkages or trade-offs and the related management policy or action

Environmental issues

Linkage or trade-off

Policy or action

Land use and remediation of natural ecosystems and habitats

Linkage Risk mitigation and enhanced value of land/ecosystem services.

Closed-loop recycling and increased reuse of produced/brackish water

Linkage Risk mitigation and cost avoidance of treatment and disposal fees.

Energy and water use (nexus) Linkage Water is used to generate energy; energy is used to provide water. Oxy applies its HESMS approach to drive efficiency of water utilization and energy consumption.

Absolute reduction of water consumption and increased reuse of produced water

Trade-off Variable water quality impedes ability to significantly increase use of brackish and produced water or incentivize investments in treatment and reuse technologies.

Further Information

37

Module: Sign Off

Page: Sign Off

W10.1

Please provide the following information for the person that has signed off (approved) your CDP water response

Name

Job title

Corresponding job category

Christopher Thomas Environment/Sustainability manager

W10.2

Please indicate that your organization agrees for CDP to transfer your publicly disclosed data regarding your response strategies to the CEO Water Mandate Water Action Hub.

Note: Only your responses to W1.4a (response to impacts) and W3.2c&d (response to risks) will be shared and then reviewed as a potential collective action project for inclusion on the WAH website.

By selecting Yes, you agree that CDP may also share the email address of your registered CDP user with the CEO Water Mandate. This will allow the Hub administrator to alert your company if its response data includes a project of potential interest to other parties using water resources in the geographies in which you operate. The Hub will publish the project with the associated contact details. Your company will be provided with a secure log-in allowing it to amend the project profile and contact details.

Yes

Further Information

CDP 2017 Water 2017 Information Request

module: introduction · groundwater - renewable 38089 higher oxy does not differentiate between...

Documents