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Report: Canada’s Oil and Natural Gas Industry Shows Ongoing Emissions Reductions

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The Canadian Association of Petroleum Producers (CAPP) released a new report on July 21 titled, Canada’s Natural Gas and Oil Emissions: Ongoing Reductions, Demonstrable Improvement. The report, which lays out the means to a lower-carbon future through innovation and new technology and illustrates the industry’s proven track record of lowering emissions-intensity, is the first in a series of planned Environment, Social and Governance (ESG) disclosures.

Highlights of the report:

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  • From 2011 to 2019 combined natural gas, condensate and natural gas liquids production increased 32 percent while emissions intensity in this sector decreased by 33 percent.
  • As a result of Canada’s flaring conservation practices, this country ranks among the lowest-emission natural gas producers globally.
  • While production from Oil Sands In Situ facilities grew by 66 percent from 2013 to 2019, emissions intensity dropped by 8 percent.
  • From 2013 to 2019 oil sands mining production increased 59 percent as emissions intensity decreased by 14 percent.
  • Canada’s offshore industry produces some of the world’s lowest emission oil.

The industry has a broad portfolio of innovative solutions to deliver emissions reductions; technological advances that are not just aspirational, but are making a difference now and continue to be developed to improve performance in the future.

Some examples of these technologies are discussed in the report and include:

  • Methane Reduction – Industry is working to reduce methane emissions to meet Canada’s goal of a 45 percent reduction from 2012 levels by 2025. Among the world’s top 10 petroleum exporters, Canada alone has a methane reduction target. Industry is working with the Alberta government on the Alberta Methane Field Challenge which is testing new methane detection technologies including sensors on drones and trucks.
  • Carbon Capture, Utilization and Storage – Facilities are already showing how carbon dioxide can be captured and stored or used in the production process, keeping millions of tonnes of carbon dioxide out of the atmosphere.
  • Cogeneration – Upstream producers can use waste heat to generate electricity. In the oil sands, excess electricity not used for plant operations is sold to Alberta’s power grid. Cogeneration supplies about 34 percent of the province’s electricity

Supplying affordable, reliable and cleaner energy to a growing global population is the goal of Canada’s upstream energy industry. Advancing greenhouse gas (GHG) emissions reduction is critical to realizing the vision for Canada to be a global supplier of choice with lower-carbon natural gas and oil.

Canada’s Natural Gas and Oil Emissions: Ongoing Reductions, Demonstrable Improvement, is the first report in a planned series of ESG disclosures from CAPP members which is expected to include Indigenous Engagement; Diversity and Inclusion; Air, Land and Water; Research and Innovation as well as Process and Personal Safety.

The entire report on emissions can be downloaded from the CAPP website, as well as the methodology.

CAPP quotes Ben Brunnen – Vice President Oil Sands, Fiscal & Economic Policy:

  • “Canada’s natural gas and oil industry has a track record of being one of the most transparent around the world. This report raises the bar even higher, positioning the industry as a leader in voluntarily reporting the collective emissions performance of our industry, and should be a challenge for other jurisdictions to do the same.”
  • “The international comparable data shows Canada is a good performer when it comes to emissions intensity but also that we’re continuously getting better. The key to our future will be the ability of our industry to quickly advance new technologies to continue reducing GHG intensity, keeping Canada a global supplier of choice.”
  • “The energy sector is working with government, regulators, and stakeholders to explore the most efficient pathways to reducing emissions. The oil and gas industry is active across the country through direct exploration and production and a multi-billion dollar supply chain. Leveraging our leadership in ESG performance and innovation can strengthen the industry and the whole Canadian economy.”
  • “Canada’s energy sector has made tremendous progress reducing GHGs and that continues through significant investment in the clean tech sector and knowledge sharing across the industry. Canadian producers of natural gas and oil are important for providing a stable global energy supply and are committed to finding efficient and effective pathways to a lower-carbon future.”

Supporting information:

  • In 2019, exported oil, natural gas and petroleum products earned $112.6 billion – Canada’s top export by value.
  • Canada produces about 1.5 percent of the world’s GHG emissions. Canada’s natural gas and oil industry produces about 0.3 per cent of overall global GHG emissions.
  • In its 2020 Stated Policies Scenario, the International Energy Agency (IEA) projects global oil demand will increase 6 percent by 2040, reaching 104 million barrels per day (bpd) while natural gas demand is expected to increase by 30 percent to 5,221 billion cubic metres over the same period. By 2040 the IEA expects oil and natural gas will provide 53 percent of global energy demand.
  • There is growing demand for Canadian heavy oil. The IEA projects heavy oil and bitumen demand will grow 21 percent by 2040 and Canada will be needed to supply approximately 79 percent of that total.
  • The IEA’s World Energy Outlook 2020, recognizes Canada as a leader in climate action.

The Canadian Association of Petroleum Producers (CAPP) represents companies, large and small, that explore for, develop and produce natural gas and oil throughout Canada. CAPP’s member companies produce about 80 per cent of Canada’s natural gas and oil. CAPP’s associate members provide a wide range of services that support the upstream oil and natural gas industry. Together CAPP’s members and associate members are an important part of a national industry with revenues from oil and natural gas production of about $116 billion a year. CAPP’s mission, on behalf of the Canadian upstream oil and natural gas industry, is to advocate for and enable economic competitiveness and safe, environmentally and socially responsible performance.

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