Diversified Energy boosts investor relations after leak allegations

Diversified Energy announced a capital markets day and a new head of investor relations as the energy group sought to shore up confidence following a critical press report.

The company said the presentation to investors on 17 November would focus on its initiatives in environmental, social and governance (ESG) matters. Diversified said subjects covered would include safety enhancements, asset integrity and replacement, emission reductions, production optimisation and financial stability, as well as progress in retiring mature assets.

Diversified's share price plunged on 12 October after Bloomberg published a story alleging methane leaks from its wells and questioning its ability to decommissioning wells. The story did not accuse Diversified of breaking rules but said there were leaks at most of the 44 sites Bloomberg visited and questioned whether the company had enough money to fund decommissioning.

The FTSE 250 group hit back on the day of the report to say the article used a tiny sample and did not reflect the benefits of its investments. Its well retirement programme is "highly successful and well funded", Diversified said.

On Tuesday Diversified said its presentation would include the expansion of its asset retirement programme, including the closure of about 115 wells so far in 2021, the use of leak detection technology and a review of its inspections.

Diversified also Jim Sheehan had joined as vice president of investor relations. Sheehan has almost 15 years' experience as a sell-side analyst. Teresa Odom, who led investor relations and ESG, has become vice president of ESG and sustainability.

Rusty Hutson, Diversified's chief executive, said: "I am looking forward to offering our shareholders and the analyst community a deep-dive into our strategy driving our rapid growth and highlighting the important work we are undertaking to address sustainability in all facets of our operations.

"Jim Sheehan brings with him a wealth of knowledge and a history of professional relationships within the sell-side analyst and investor communities which will serve Diversified well as we seek to broaden our company story and business model to the investment community. His knowledge of ESG and the important role it plays in industries like ours will also be a valuable resource to Teresa and our operations teams as we strive to continually and transparently share our stewardship message with all stakeholders."

Diversified has more than 60,000 onshore wells in the US that mainly produce gas. Bloomberg alleged the company had "an empire of dying wells" and was "one of the strangest companies ever to hit the American oil patch".

Shares of Diversified rose 3.9% to 116.82p at 09:32 BST. The shares lost a fifth of their value on the day of the Bloomberg report, dropping to 101.4p.