London-listed Diversified Energy woes continue following methane probe
London-listed oil and gas well owner Diversified Energy is facing yet more pressure, as the United States Congress asked it to account for methane leaks across its North American wells this week.
Four Democratic members of the House Committee on Energy and Commerce wrote to the company’s chief executive Rusty Hutson Jr on Monday, asking for a plan for well remediation and how the company monitors methane emissions with its portfolio of 70,000 wells.
“As the largest owner and purchaser of oil and gas wells in the United States, Diversified Energy is responsible for remediating a substantial share of the country’s ageing oil and gas wells, but we are concerned that your company may be vastly underestimating well cleanup costs,” wrote the members.
The letter continued that Diversified might abandon thousands of wells, leaving billions of dollars of cleanup costs to state governments in Pennsylvania, West Virginia, Ohio and Kentucky.
“If this analysis is accurate, it is highly unlikely that Diversified Energy will have adequate funds to clean up all of its marginal wells when they should be retired,” the four Committee leaders added.
The company has previously denied allegations of negligence over methane emissions and recently claimed it had retired 200 wells this year.
The company’s share price, down 49 per cent in the year-to-date, fell 15 per cent after the news broke yesterday morning. Stock recovered slightly in early trade in London on Wednesday.
The news came one day after the company announced its new additional listing on the New York Stock Exchange, a move Hutson Jr described as “an important milestone and a high-priority strategic initiative for the year.”