AB climate strategy expected to help build more market access

November 22, 2015 - calgary, Alberta
Alberta’s Climate Leadership Plan provides direction that will allow the oil and natural gas industry to grow, further enhance its environmental performance through technological innovation, and is expected to improve market access to allow Canadian oil to reach more markets, the Canadian Association of Petroleum Producers (CAPP) said today.

“Improving market access for our oil and natural gas resources is one of the most pressing priorities of our industry to ensure that our sector can continue to grow and provide prosperity to Albertans and all Canadians,” said Tim McMillan, CAPP’s president and chief executive officer. 

“As Premier Notley said today, we expect today’s announcement to further enhance the reputation of our sector and improve our province’s environmental credibility as we seek to expand market access nationally and internationally. As well, the province’s climate strategy may allow our sector to invest more aggressively in technologies to further reduce per barrel emissions in our sector and do our part to tackle climate change. That’s what the public expects, and that’s’ what we expect of ourselves.”

Today’s plan will build on Alberta’s oil and natural gas industry’s ongoing commitment to environmental performance and emissions reductions.

Environment Canada reports that emissions per barrel of oil produced from the oil sands are down 30 per cent from 1990 levels. Pilot projects that use solvents in oil sands in situ operations, and projects that use carbon capture and storage technology are examples of technological innovation our industry is already pursuing to reduce per barrel emissions even further.

“The government recognizes the importance of technological innovation as part of the Climate Leadership Plan. At the same time, however, we realize this is only a first step as several of the principles outlined today require more detail before they become part of the province’s climate change policy,” McMillan said.

“We will work with the government as these principles are put into practice, and we encourage the province to follow a balanced approach, recognizing that our sector can only become a global supplier of responsibly produced oil and natural gas if we are competitive on the world stage.”

Today’s announcement also presents an opportunity to use more natural gas to generate electricity in Alberta as the province accelerates the phase-out of coal-fired electricity generation.

“Natural gas is the cleanest-burning fossil fuel. Used in power generation, it emits about half the carbon dioxide compared to coal and could virtually eliminate emissions of smog-causing pollutants,” McMillan said. “Fuel switching would create about 1.5 billion cubic feet per day of new natural gas demand in Alberta. Under the current royalty regime this translates into roughly $140 million per year in new royalties for the province, because natural gas pays much higher royalties than coal based on price and production.”

McMillan will represent CAPP at the 2015 Paris Climate Conference to provide constructive input into how Canada’s governments can develop effective policies to reduce greenhouse gas emissions to help ensure that a Canadian Energy Strategy can be implemented and improved market access of Canadian oil and natural gas can be realized.

“We have the energy the world needs and we have environmental standards our customers expect,” McMillan said. “So let us – industry and governments – build on what’s in place to ensure Canada can become a larger and leading supplier of responsibly produced energy to the world.”

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