California Resources Corporation · NYSE:CRC
California Resources — ESG Presentation (October 2019)
24 slides from California Resources's sustainability presentation, Oct 18, 2019
Slide 1: 2019 CRC Governance Overview
2019 CRC Governance Overview October 2019
Slide 2: Forward Looking / Cautionary Statements – Certain Terms
Forward Looking / Cautionary Statements – Certain Terms This presentation contains forward-looking statements that involve risks and uncertainties that could materially affect our expected results of operations, liquidity, cash flows and business prospects. Such statements include those regarding ou
Slide 3: CRC Overview
CRC Overview Our Company CRC Key Statistics ▪ CRC is an independent exploration and production (E&P) 1 company focused on high-return assets in California Market Cap $0.5 BN USD ▪ CRC explores for, produces, gathers, processes and markets Enterprise Value1 $6.6 BN USD crude oil, natural gas and natu
Slide 4: Impact of Oil Prices & Debt Burden on Stock Price
Impact of Oil Prices & Debt Burden on Stock Price Management stress-tested through severe downturn in oil prices, combined with the highly levered capital structure inherited from Occidental. Prudent decisions have led to credit improvement despite volatility of equity through recent commodity price
Slide 5: Reflecting Californians' Values
Reflecting Californians’ Values • Proudly share state’s commitment to natural resources • Proven track record in sensitive coastal, urban and agricultural settings ▪ Certified wildlife habitat conservation programs at Elk Hills, THUMS Islands and Huntington Beach Sutter Buttes, Sacramento Basin • De
Slide 6: Advancing California's Sustainability Strategy
Advancing California’s Sustainability Strategy CRC’s 2030 Goals demonstrate our long-term commitment to sustainable in-state energy production that meets the needs of California’s growing population and California’s leading safety, labor, human rights and environmental standards. Measured against a
Slide 7: HSE and Regulatory Takeaways
HSE and Regulatory Takeaways • Delivering on safety • Engaging with key stakeholders • Advancing 2030 Sustainability Goals • Securing robust drilling permit inventory • Constructive participant in legislative and regulatory process 2019 CRC Governance Review| 7
Slide 8: Strong Board Oversight
Strong Board Oversight [BOARD AND MANAGEMENT LEADERSHIP] William Albrecht Harold Korell Todd Stevens Non-Executive Chairman Lead Independent Director President & CEO The Chair and Lead Independent Director lead the Board in its oversight role, enabling the CEO to focus on the company’s business oper
Slide 9: Board is Committed to Governance Best Practices
Board is Committed to Governance Best Practices ✓ Separate Chairman and CEO Roles ✓ Pay for Performance Alignment ✓ Independent Lead Director ✓ Clawback Policy ✓ Majority Independent Board (8 of 10) ✓ Robust Stock Ownership Guidelines ✓ Independent Board Committees ✓ Retain Independent Advice ✓ Regu
Slide 10: Aligning Pay with Shareholder Interests
Aligning Pay with Shareholder Interests Since our launch in 2014, the Compensation Committee has taken several actions to [ ensure our executive compensation program is aligned with shareholder interests ] Compensation Committee reduces number of metrics for annual incentive to focus on key objectiv
Slide 11: Stockholder Outreach
Stockholder Outreach CRC consistently requests meetings with several large stockholders to discuss governance and executive compensation practices • Overall, we received positive feedback on our ESG programs and efforts • Some investors suggested that we consider: ▪ Providing more detailed disclosur
Slide 12: 2019 Executive Compensation Program Changes
2019 Executive Compensation Program Changes To further align management compensation with stockholder interests, the Board made changes to the 2019 program Updated Element Program Changes for 2019 Incentive Details Measure Weighting Strategic & Individual Objectives ▪ Stakeholder outreach Liquidity
Slide 13: Conclusion
Conclusion • Management executed on strategic priorities • The Board remains focused to shape the compensation program around strategic priorities and ensure it aligns • The Board solicited shareholder feedback and management with shareholder interests responded by: • The Board ensures skills and ex
Slide 14: APPENDIX
APPENDIX
Slide 15: 2019 Proxy Results
2019 Proxy Results CRC’s proxy proposals all passed with solid shareholder approval except for Supermajority Provisions Item Action Results Votes 1 Elect William E. Albrecht to BOD Passed with 98% approval For – 20,821,795; Against – 213,043; Abstentions – 110,993 * Elect Justin A. Gannon to BOD Pas
Slide 16: CRC's Value-Driven Strategic Approach
CRC’s Value-Driven Strategic Approach Capture Value Ensure Effective Drive Operational Strengthen of Portfolio Capital Allocation Excellence Balance Sheet • Pursue value-driven • Utilize VCI-based • Streamline processes • Reinvest to grow cash production growth decision making flow • Apply technolog
Slide 17: Successfully Cut Methane Emissions by 60%
Successfully Cut Methane Emissions by 60% • CRC’s goal is more stringent than the State’s ▪ CRC 2030 Goal: 50% methane emission Company-wide Methane Emissions by Year reduction 300,000 ▪ State’s 2030 Goal: 40% reduction 250,000 • CRC surpassed our goal in 2018 with a 60% reduction in methane emissio
Slide 18: Serving as Net Water Supplier
Serving as Net Water Supplier Water Strategy Objectives • Create long-term value from produced water • Help farmers and communities solve a key challenge • Minimize CRC’s fresh water use in operations • Reduce operating expenses • Achieve CRC’s annual and 2030 water conservation goals Supplied recor
Slide 19: Elk Hills Carbon Capture and Sequestration (CCS)
Elk Hills Carbon Capture and Sequestration (CCS) ‘ California Energy Commission: ‘ CCS+EOR Project Elements • Awarded Department of Energy grant on carbon The Project identified the Elk Hills Field as one of the capture FEED study to capture 75% of CO2 premier CO2 EOR and Sequestration sites in the
Slide 20: Integrating Renewables into Our Operations
Integrating Renewables into Our Operations CRC Supports a Diverse, Balanced Energy Supply CRC is a net electricity supplier and enables CRC is evaluating multiple renewable projects expansion of renewables to meet our 2030 Renewables Goal: Facilitated 640 MW of commercial-scale solar • Designed 2 MW
Slide 21: 2018 Environmental, Social and Governance Highlights and Quick Reference Information
2018 Environmental, Social and Governance Highlights and Quick Reference Information CRC’s sustainability disclosures seek to align with the reporting guidelines of the Sustainability Accounting Standards Board (SASB). These standards (available in provisional form for 77 industries including Oil &
Slide 22: 2018 ESG Highlights and Quick Reference Information – Social
2018 Environmental, Social and Governance Highlights and Quick Reference Information SOCIAL REPORTED DESCRIPTION/COMMENT Sustainability – Health, Safety, Environment & Community Committee of the Board Board of Directors Oversight Committee Yes Reports to the full Board of Directors at every meeting
Slide 23: 2018 ESG Highlights and Quick Reference Information – Social and Governance
2018 Environmental, Social and Governance Highlights and Quick Reference Information SOCIAL REPORTED DESCRIPTION/COMMENT Social Investments and Government Yes Sustainability Report Production-Sharing Cultural Resource Protection Program Yes Incorporated in Habitat Conservation Program % of proved re
Slide 24: 2018 ESG Highlights and Quick Reference Information – Governance
2018 Environmental, Social and Governance Highlights and Quick Reference Information GOVERNANCE REPORTED DESCRIPTION/COMMENT Executive Compensation tied directly to Yes Annual HSE Goals and Progress toward 2030 Sustainability Goals reported in 2019 Proxy Sustainability Corporate Governance Policies
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