Environmental, social, and governance (ESG) scores play a pivotal role in the strategic design of firms. The literature has demonstrated the importance of sustainability issues in the financial performance of firms around the world. In particular, understanding the relationship between sustainability and the cost of capital is crucial for determining financial strategy and decision making. We identify an opportunity in the literature to analyze this relationship within Latin America (LatAm) firms. Thus, this study analyzes the relationship between ESG scores with the cost of capital of firms with headquarters in LatAm using a data set that includes 606 observations corresponding to information about 202 firms from 2017 to 2019. To conduct our analysis, two fixed effects panel data models were estimated. We model this relationship by taking ESG scores and each of its ESG Pillar scores—i.e., Environmental, Social, and Governance pillar scores—as independent variables and analyzing how they affect the cost of capital. According to the results, there is an inverse effect relationship between ESG scores and the cost of capital. Additionally, we did not find a relationship between the Social Pillar score and the Environmental Pillar score with the cost of capital. By contrast, the Governance Pillar score shows a negative relationship with the cost of capital. This indicates that the increase in transparency about internal processes and governance entities can be an essential driver of value creation for firms and higher financing confidence in LatAm firms. This study represents a breakthrough in explaining the impact of ESG scores on the cost of capital in LatAm. Ultimately, the current study presents the potential for further research in this field.

Experiments have been performed to determine the rate of water vaporization in core samples at initial water saturation. The effect of pressure on rate of water vaporization has been studied. The experiments indicate that as pressure decreases from 2000 to 1000 psi, at constant temperature of 90°C, the rate of water vaporization increases from approximately 0.016 to 0.025 g/min. The effect of increase in temperature from 90°C to 100°C, at constant pressure of 1500 psi, is to increase the rate of water vaporization from 0.018 to 0.029 g/min. All the experiments were performed with the core samples at initial water saturation of 18%. As vaporization takes place, the brine remaining in the core sample becomes more concentrated. If concentration exceeds the critical supersaturation value, minerals will precipitate out into the formation. Additionally, the effect of salt precipitation on absolute permeability was determined. The results indicate that reduction in absolute permeability after the vaporization experiments ranges from approximately 14 to 30%. Introduction Water vaporization has been reported as the cause of permeability reduction in some oil fields and as a potential problem in many others, especially in high pressure, high temperature reservoirs (HP/HP) which are characterized by very high salinity brines4. In gas producing reservoirs, vaporization occurs as a result of the increase in the molar water content as the pressure declines around the wellbore. In the case of gas injection, the dry gas vaporizes water in order to fulfill the thermodynamic requirements at the given pressure, temperature and salinity of the brine. As water is vaporized, salt precipitates if the critical supersaturation value is reached. In gas producing reservoirs, water vaporization initially increases the effective permeability to gas by increasing the area available for flow. This increase in effective permeability to gas due to water vaporization has been reported for the case of water blocks5. However, salt precipitation can increase over time around the wellbore, i.e., due to water imbibition into the zones where water has been vaporized, causing a detrimental impact on gas effective permeability. To the author's knowledge, one of the first experimental studies performed to determine the rate of water vaporization were carried out by Dodson and Standing in a PVT cell3. They found that the rate of water vaporization increases with temperature and decreases with pressure and solids content. The authors did not perform experiments on porous media. Morin and Montel7 studied the conditions for water vaporization as a function of salinity and pressure. The authors pointed out the main conditions that contributed to salt plugging: flow of gas from layers at different water saturation8 and significant pressure drop from the near wellbore area to the well. Other authors2,6 have modified compositional simulators to account for mass transfer between water and hydrocarbon components to be able to predict the amount of water vaporized from the reservoir. Such amount of water is crucial for the design of water handling facilities. Bette and Heinemann2 also confirmed vaporization in the field. They took cores from Arun field gas injectors that showed very low water content and in some cases, the water was completely vaporized. In a different scenario, also associated to water vaporization, the subnormally low water saturation presented by many tight gas reservoirs has been attributed to vaporization of initial water by long term regional migration of undersaturated gas1. Consequently, the brine remaining in the reservoir was saturated (300,000 TDS plus) and additionally, large volumes of crystalline salt, especially halite were encountered in the porous media.