TGS Board Oversight
TGS’ Board of Directors oversees TGS’ strategy and efforts in assessing the financial, business and operational risks, and opportunities associated with climate change on TGS. The risks and opportunities related to climate change and its impact on TGS, either directly or indirectly, and the energy industry, oil price, customer behavior and technology advancement are all considered by the Board as part of the annual risk enterprise assessment. The Board also holds annual strategy sessions in which it evaluates TGS’ business strategy considering changes to the industry, market conditions, customer behavior and technology brought on by the impact of climate change. The Board also receives regular operational updates that highlight the impact climate risk has on operations, as there are changes in environmental legislation, increased reporting requirements and greater need for stakeholder engagement. Finally, the Compensation Committee reviews and approves climate goals and objectives related to executive compensation and TGS’ employee bonus plan.

TGS Leadership’s Role
TGS’ EVP, People and Sustainability, is responsible for overseeing TGS’ sustainability strategy which includes assessment of the climate-related risks and opportunities and putting in place a strategy to reduce Scope 1 and 2 emissions. TGS’ VP Projects and HSE Director are responsible for measuring emissions in operations and working with business units to develop and design surveys with minimal environmental impact. TGS’ EVP Digital Energy Solutions is responsible for providing products and services that assist our customers in addressing their climate impact through carbon capture and storage and transitioning to other energy sources like wind or geothermal. Finally, TGS’ entire Leadership Team participates in the annual risk assessment and strategy sessions, implements the action plans related to these exercises, and assesses and evaluates all relevant risks, including the impact of climate change, on projects and corporate strategy.

TGS’ strategy to address climate impact is influenced by the following key factors: impact of market conditions and the oil price, shifts in customer behavior, advancements in technology and changes in legislation and policy. TGS regularly reviews and adjusts its strategy to mitigate and account for the impact of these key factors. In 2021, TGS modified its strategy to diversify its business and revenue stream to serve carbon capture and storage, deep sea mining, geothermal energy, wind energy and solar energy. This adjusted strategy addresses the potential financial impact to the changes in oil and gas exploration and provides business opportunities for new revenue streams, products and services. TGS aims to achieve this strategy through both organic and inorganic growth.

Risks
Short-term (3-5 years) risks include increased environmental legislation and permitting requirements, changing customer behavior, uncertainty in the market. Medium-term (5-10 years) risks include carbon pricing mechanisms, mandates and regulations on existing products and services, transition to lower-emissions operations, technology advancements.

Opportunities
Short- and medium-term (5-10 years) opportunities include access to new markets and expansion of data and service offerings.

Risks and opportunities are identified, assessed and managed at the overall corporate level, department level and project level. These risk assessments analyze changes in our industry and market, customer behavior, environmental legislation and industry practices, and developments in technology.

Identifying Risks
Climate-related risks are identified at a corporate level through the annual risk assessment process which includes consideration of the energy industry, energy mix, oil price, customer behavior, technology advancement, and legal and regulatory changes. The impacts of climate-related risks are assessed as part of the project development and management process to understand the impact local rules or regulations may have on permitting, address concerns to local communities and environments with respect to project impact, assessing technology solutions. These are identified through environmental impact assessments (EIAs), site surveys, public or social consultations, engaging with environmental consultants, participation and membership in industry trade organizations (e.g., EnerGeo, IOGP), projectspecific hazard assessments and consultation with regulators and permitting agencies.

Managing Risks
TGS commissions EIAs to understand potential impacts on the environment it may operate in. TGS also employs protected species observers (PSOs) and utilizes passive acoustic monitoring (PAM) on its operations to ensure our operations do not have a detrimental effect on the environment in which we operate. TGS employs various other environmental mitigation measures including conducting soft starts or ramp-ups and placing buffer zones around environmentally sensitive areas. TGS also coordinates with relevant stakeholders (i.e., customers, local communities, government agencies, industry trade organizations, partners, suppliers, etc.) to ensure we are addressing concerns and mitigating risks as appropriate.

Integrated Risk Management
Risk management is integrated throughout the organization at the corporate level, department level and project level. TGS’ annual risk enterprise program incorporates environmental and climate-related risks, as well as TGS’ mitigation measures. TGS’ Board and Leadership Team also look at the climate-related risks and opportunities as part of its regular strategy sessions to ensure that TGS’ short-term and long-term strategies account for all relevant risks and opportunities. TGS also receives regular feedback from its stakeholders, including investors and clients, and incorporates such feedback into how TGS manages its climate-related risk.

2021

Scope 1 emissions: < 1 mt CO₂e

• The above accounts for total Scope 1 emissions over which TGS has financial control

Scope 2 emissions: 11,208.25 mt CO₂e

• The above accounts for total Scope 2 emissions over which TGS has financial control

Scope 3 emissions (operations): 133,488.86 mt CO₂e

• The above accounts for emissions derived from fuel consumption by our vendors for our marine, onshore and air seismic operations in 2021.

TGS follows the Greenhouse Gas Protocol in classifying, deriving and calculating its emissions. The Scope 1 and 2 emissions calculations are based upon the IEA International Electricity Factors (2020), UK DEFRA - Conversion Factors (2020), US EPA - eGRID 2019 Sub Region and US EPA - Emissions Factor Hub 2020. Scope 3 marine operations emissions calculations are based on the European Commission’s “Quantification of Emissions from Ships Associated with Ship Movements between Ports in the European Community,” July 2002; Econometrica “Greenhouse Gases, CO2, CO2e, and Carbon: What do all these Terms Mean?,” August 2012; “Excise Duty on Emissions of NOx,” 2015 no. 14/2015S; The Greenhouse Gas Protocol; and the EPA’s “Greenhouse Gas Inventory Guidance: Direct Emissions from Stationary Combustion Sources,” December 2020. Scope 3 land and airborne seismic operations emissions calculations are based upon the EPA Simplified GHG Emissions Calculator (SGEC) version 3.2 June 2014.

Targets

Scope 1 and 2 short-term CO₂e target: remain below the baseline levels established in 2020 (12,355 mt CO2e)
Combined Scope 1 and 2 emissions for 2021 is 11,208.91 mt CO2e, which is a 10% decrease from 2021. Scope 1 and 2 long-term target: Net Zero CO2e emissions by 2030