Leader's Letter

For Syncrude, 2016 will long be remembered as a year when our organization was tested like never before. It started in May, when a massive wildfire bore down on the Fort McMurray community and forced the unprecedented evacuation and shutdown of our entire operation.

As soon as the emergency began, employees rallied to solve extremely complex, demanding and often dangerous problems. Our emergency responders and a number of heavy equipment operators took to the front lines to help battle the fire and protect homes, businesses and essential infrastructure around the region. Their efforts were truly courageous.

When thousands of Fort McMurray residents headed north to escape the city, we opened our plant site as a place of refuge, with employees taking on diverse logistical responsibilities to make our guests feel safe and comforted. While we were caught unprepared for the influx of people (no one foresaw the demand for diapers and dog food), we managed to overcome these challenges and take care of family members and other visitors until they were eventually evacuated out of the region.

Although our operations weren’t physically touched by the wildfire, the impact was significant, if not historic. When smoke from the fire approached levels harmful to human safety at our site, we made the decision to shut down operations. This move was unprecedented, but was executed safely and under a tremendously tight timeline.

Once we could safely return to the site, the task of restarting operations and getting 4,500 people who had scattered across Canada back to work presented additional logistical and technical challenges. But our employees did extraordinary things to make the best of an extraordinary situation, and despite losing 44 days of production, we went on to set new production records for the remainder of the year.

Our employees truly demonstrated they were up to the challenge, and proved their mettle even further through focused actions to maintain our commitment to responsible operations despite a breadth of competing priorities. While many were bringing our mine and plant facilities back on line, others were out reclaiming 126 hectares of land and planting more than 400,000 trees and shrubs. We also had a successful first year of operation for our tailings centrifuge plant which reclaimed over five million cubic metres of fine tailings for use in land restoration activities. In addition, we reinforced our efforts to address climate change by establishing an executive-led team to better bring together diverse perspectives and knowledge from throughout our organization to guide our strategy and identify opportunities to improve energy efficiency and minimize our carbon footprint.

In addition, our focus on sharing opportunity with local Indigenous communities of interest was unwavering, demonstrated by reaching 9.8 per cent Aboriginal representation in our workforce (the highest in 10 years) and increasing the percentage of Aboriginal procurement relative to total Alberta procurement by more than 60 per cent since 2014. To date, our cumulative spending with Indigenous businesses stands at over $2.6 billion.

However, we had mixed results in other areas. Despite executing the shutdown and restart of the operation without any safety incidents, we were unable to maintain the momentum and ended the year with lower than target safety performance. And while flaring was 80 per cent less than our previous three-year average and sulphur dioxide emissions continued to decline, there were growing concerns from the neighbouring First Nation and Métis community of Fort McKay regarding regional odours. We are currently working with other operators, government and the community to deliver on 17 recommendations to address this important quality-of-life issue.

Our sustainability journey continues, and the path remains guided by our corporate Vision and Values. This set of principles – the Vision to Lead, Knowledge to Succeed, Commitment to Do Better and the Heart to Win the Race – may have been developed in the early 1990s, but still resonates deeply throughout our organization today. It builds accountability into our actions and shapes every decision we make. Indeed, our success is not measured only on the results we achieve, but how we achieve them.

While we expect global competitive pressures to remain high over the next number of years, we are confident our production of high quality, light, low-sulphur crude oil gives Syncrude an advantage in the supply of responsible energy. This, combined with increased collaboration with the Syncrude Joint Venture Participants and a focus on operational reliability and creating shared value, lays a solid foundation upon which we will continue to build a strong, sustainable future.

Mark Ward
President and Chief Executive Officer