Climate change is a global issue requiring action from individuals, governments, organization and industries around the world. Addressing climate change is bigger than one industry or one country – it requires a global perspective. But Canada is uniquely positioned to help meet global climate commitments as the global supplier of choice in a world that demands a lower carbon energy future.
Environment and Climate Change Canada, 2020; World Resources Institute, 2019
Canadian Emissions in a Global Context
Canada produces less than 1.5% of the world’s greenhouse gas (GHG) emissions. Of that, Canada’s oil and natural gas industry produces about 0.3% of overall global GHG emissions.
Growing Production While Meeting Climate Commitments
By acting globally, Canada can make an outsized contribution on addressing climate change.
The challenge is how to reduce global GHG emissions while the global demand for energy is growing. Canadian producers are uniquely positioned to meet this challenge – both as secure suppliers of sustainable energy and as global leaders in emission reduction innovation and technology.
Industry’s Climate Commitment
Canada’s upstream oil and gas industry is the global supplier of choice in a world that demands a cleaner energy future. Growth is enabled through domestic and global recognition of the Canadian industry’s climate performance leadership. Continued investment in innovation and technology is driving down emissions intensity and positions our industry as part of the global solution needed to tackle the global climate challenge.
The World's Best LNG
Canada has a huge potential role to play in reducing net global emissions. Liquefied natural gas (LNG) produced in Canada will be among the world’s best from an emissions standpoint. For example, LNG Canada, which is constructing an LNG facility near Kitimat B.C. on Canada’s West Coast, estimates its emissions intensity (tonnes of carbon dioxide emitted per tonne of LNG produced) will be lower than other global producers.
Using responsibly produced Canadian LNG instead of coal to generate electricity will reduce global emissions because natural gas emits less carbon dioxide than coal.
World Leader in Energy Innovation and Technology
Developing energy resources, and transporting those resources to consumers, is a challenge that demands innovative solutions. But that’s nothing new for Canada’s energy sector, which is a technology-driven industry. The largest oil and natural gas producers in our country are pledging meaningful reductions to GHG and methane emissions, and their results prove Canada can transition to a low-carbon economy while still creating prosperity and protecting the environment.
Reducing Global Emissions with Canadian Energy
Canada’s oil and natural gas resources are among the most responsibly produced energy sources on the planet, under the most stringent environmental regulations in the world. In Canada’s oil sands, emissions have fallen significantly, as shown in CAPP’s report “Ongoing Reductions, Demonstrable Improvement.”
From exploration to production, the industry is working to reduce emissions in every process and activity associated with oil and natural gas. Some examples:
- The team at Enhance Energy is using a proven technique called ‘enhanced oil recovery’ (EOR) that involves obtaining CO2 from large industrial emitters in Alberta and injecting it into a developed oil reservoir that is near the end of its conventional life. The result would be a multiple win: producing energy the world needs, creating jobs, and helping reduce greenhouse gas (GHG) emissions. It is expected that oil produced from this project will have 60% lower emissions than conventionally produced oil.
- Canadian Natural Resources has committed to achieving net-zero emissions in the oil sands though innovation. Since 2009, the company has invested $3.1 billion in research and development, and technologies. It has reduced corporate GHG intensity 18% between 2013 and 2017; stored 17.9 million tonnes of carbon dioxide (the equivalent of taking 576,000 cars off the road) between 2013 and 2018; and, reduced methane emissions in heavy oil operations by 71% since 2013.
- Since 2015, Quest CCS has captured and stored five million tonnes of CO2 from the Shell Canada-operated Scotford Upgrader, the equivalent of one million cars. It is the world’s first commercial-scale CCS facility for the oil sands.
Reducing Methane Emissions
Small leaks of methane, called fugitive emissions, come from valves, pump seals, and other equipment used in natural gas drilling and production. Methane is also released when natural gas is flared or vented. Canada is a global leader in limiting the flaring and venting of methane and is developing new cleantech to detect and mitigate methane leaks.
- Canada accounts for just 0.5% of global flaring thanks to leading regulation and industry’s commitment to environmental performance.
- In 2019 the Petroleum Technology Alliance of Canada (PTAC) hosted the Alberta Methane Field Challenge, the only methane challenge assessing real-world performance of new methane sensing technology in comparison with conventional optical gas imaging-based leak detection surveys. PTAC has supporting the development of methane detection and mitigation technologies that can collectively reduce the oil and gas sector’s methane emissions by 48 percent.
- A report released by the Government of Alberta in January 2022 shows the natural gas and oil industry in Alberta is on track to achieve the province’s methane emissions reduction target. The industry target is to reduce methane emissions by 45% from 2012 emission levels by 2025.
LNG and Climate Change
Canada can become a world leader on climate action through technology and innovation, and by continuing to develop natural gas responsibly. Electrification of upstream production is an important step in this process.
Canadian natural gas presents opportunity for significant environmental benefit. Natural gas is the cleanest-burning hydrocarbon – emitting about 40% less carbon dioxide (CO2) when used in electricity generation.
LNG: The Coal Alternative
Natural gas is an alternative to coal for generating electricity. According to the American Geosciences Institute, natural gas emits about half the CO2 than coal.
America Geosciences 2022
Alternative to Coal in Asia
Exports of Canadian liquefied natural gas (LNG) to Asia would help displace coal-fired electricity generation. This would result in significantly decreased net global emissions.
Natural Gas is a Lower-emitting Energy Source
Natural Gas: A Partner for Renewable Energy
Natural gas can also play an important role in advancing renewable energy. Electricity generated from natural gas can contribute to the electrical grid when intermittent renewable energy sources, such as wind and solar, are not available.
According to the Canada Energy Regulator (CER), electricity generation in Canada must grow 30% by 2040 to meet demand, with natural gas-fired and renewable-based energy showing the largest increases. The CER expects power generation from natural gas to increase from 10% to 16%, and generation from renewables to grow from 5% to 11%. (Source: Canada’s Energy Future 2018: Energy Supply and Demand Projections to 2040)
Canadian Carbon Policy
Canada is a world leader in climate policy. Compared to global competitors, Canada has one of the world’s toughest climate policies based on price and stringency. Climate policy is governed in Canada by provincial and federal governments.
As of 2019, the federal government has implemented a Carbon Pollution Pricing policy that sets a minimum benchmark price on carbon emissions as a way of incentivizing greenhouse gas emissions reduction. Provinces must either meet the benchmark through their own carbon pricing policies, or else the federal government will impose the backstop carbon price. As of April 2022, the federal minimum carbon price is set at $50 per tonne of CO2, and is set to increase by $15 per year, up to $170 per tonne by 2030 (Source: Government of Canada). Find out more:
- B.C. Climate Leadership Plan
- Alberta’s Technology Innovation Emission Reduction (TIER) Regulation
- Saskatchewan’s Prairie Resilience – A Made-in-Saskatchewan Climate Change Strategy
- Ontario Climate Change Policy
- Quebec Climate Change Action Plan
- Nova Scotia’s Action on Climate Change
- Canadian Federal Government: Action on Climate Change