Recognizing that addressing climate change is important to the future of our industry and country, we aim to minimize GHGs through improvements in energy efficiency, process reliability, and reduced flaring and venting.
Over $19 million
payment to Alberta Climate Change and Emissions Management Fund.
Energy intensity of crude oil production averages
1.38 million BTUs per barrel.
Greenhouse gas emissions intensity remains
0.11 tonnes per barrel.
The International Energy Agency predicts that energy demand will grow by about one-third between 2013 and 2040, underlining the case that energy from all sources – including conventional oil, oil from oil sands and renewables – must be developed. At the same time, both federal and provincial governments have outlined their commitments towards meeting the goal of the Paris Agreement, which calls for action on greenhouse gas emissions (GHGs) and to limit increasing average global temperatures to under 2°C above pre-industrial levels.
As a large producer of greenhouse gas emissions in Canada, Syncrude recognizes that addressing climate change is important to the future of our industry and country. In this respect, we believe every sector has a role to play. In our own operations, we aim to minimize GHGs through improvements in energy efficiency, process reliability, and reduced flaring and venting. We also contribute toward studies on improving quantification methods and engage on this issue through industry associations as well as directly with provincial and federal governments.
Greenhouse gas emissions from Syncrude in 2015 remained relatively stable compared to the previous year at 11.47 million tonnes, or 0.11 tonnes CO2-equivalent per barrel. We consumed approximately 1.38 million BTUs per barrel, which was above our established target of 1.29 million BTUs, due to process reliability issues during the year.
Energy conservation is core to our business. Extensive cogeneration processes are incorporated throughout our operation in order to recover waste heat for reuse. As a result, we do not use all the energy we produce and export excess electricity, included in our total greenhouse gas emissions calculation, to the Alberta grid. In fact, as one of the most efficient means of producing electricity from natural gas, oil sands cogeneration has helped to reduce Alberta's overall grid intensity. In 2015, we exported 85,000 MWh for use by Albertans – enough to power about 120,000 homes for a year.
Increased energy efficiency correlates directly to lower greenhouse gas emissions, and it also improves financial outcomes. As we continue to pursue the next generation of oil sands technologies and reliability improvements, energy efficiency remains a key factor when evaluating capital and maintenance projects. In fact, when evaluating capital spending, projects that have significant energy efficiency advantages are permitted a lower financial return on investment.
Syncrude has fully adapted and implemented two ExxonMobil-developed operations management systems – the Operations Integrity Management System (OIMS) and the Global Reliability System (GRS) – to improve safety, reliability and environmental performance at our operations. In addition, we are implementing aspects of ExxonMobil’s Global Energy Management System, which will help to identify energy-saving opportunities throughout the operation. Current plans are focused on improving steam management, naphtha and bitumen recovery, fuel management, heat transfer and energy real-time optimization.
Alberta is one of the few jurisdictions in North America that has a price on carbon and a regulated carbon offset market. The Alberta Specified Gas Emitters Regulation, established in 2007, set aggressive intensity targets for Large Final Emitters of carbon dioxide. It requires operations such as Syncrude to reduce per barrel emissions of greenhouse gases by 12 per cent from the average per barrel emissions between 2003 and 2005. If Syncrude does not meet this target in any reporting year, we must purchase offset credits or pay into the Alberta Climate Change and Emissions Management Fund, which invests in the development of emissions reduction technology. Both these options are assessed at $15 per tonne of CO2 that is in excess of reduction targets. Changes to the regulation will increase this levy in 2017 to $20 per tonne, with a 50 per cent reduction target, and in 2018 to $30 per tonne, with a 20 per cent reduction target.
Syncrude did not meet the target for 2015 and contributed $19.7 million into the Fund.
The federal government’s Renewable Fuels Regulations require Syncrude to include at least two per cent renewable fuel in our distillate pool, including diesel fuel for our mining fleet. Syncrude has complied with the regulations by purchasing offset credits.
Through a 2013 federal court judicial review, we unsuccessfully challenged the validity of the regulations as it applies to diesel produced and consumed at our operations. We appealed the court’s decision in the Federal Court of Appeal in 2015. Syncrude’s challenge was based on evidence that compliance would actually increase overall greenhouse gas emissions, rather than reduce them.
In mid-2016, the Federal Court of Appeal dismissed our case and we continue to comply with the regulations by purchasing offset credits.
Through Canada’s Oil Sands Innovation Alliance (COSIA), we are collaborating on research to assess how water, energy and carbon are stored and travel within a reclaimed landscape as compared to natural undisturbed areas. This includes support of the Hydrology, Ecology and Disturbance (HEAD) program, a multi-year and multi-university research program focused on the role of climate on the landscape. In addition, two Syncrude Joint Venture Participants are involved in a research study to investigate the use of satellite technology to provide more accurate and frequent measurements of fugitive GHG emissions from tailings ponds and mine faces. Learnings will be shared with all COSIA members.
As a member of the Mining Association of Canada (MAC), Syncrude participates in the Towards Sustainable Mining (TSM) program. We report annually on our energy and greenhouse gas emissions management and our results are externally verified every three years. Participation in TSM also provides the opportunity to learn from, and share best practices with, mining companies across Canada.
We also participate in the MAC Climate Change Task Force and contributed to the development of its Principles for Climate Change Policy Design which supports a carbon price to help reduce emissions.
Syncrude provided input to Alberta's Climate Change Advisory Panel which made recommendations to the provincial government and led to the Alberta Climate Leadership Plan announced in late 2015. Our position is that cogeneration offers a significant opportunity to further contribute to Alberta's base load power supply with reliable, low-cost and low GHG-intensive energy. To ensure investor confidence toward achieving this, there must be appropriate long-term policy certainty, clarity and transparency, as well as clear regulatory processes, around the treatment of cogeneration within Alberta's future climate strategy.
Another opportunity lies in further leveraging of Alberta's provincial Scientific Research and Experimental Development tax credit, which includes credits for expenditures related to the development of technologies intended to reduce environmental impacts. Furthermore, funds from Alberta's Specified Gas Emitters Regulation should be invested to develop and deploy new emission-reducing technologies in the oil and gas sector that could have broader economic and environmental implications. Our entire submission can be found here.
|Total energy consumption (billion BTUs)||136,647||133,926||129,705||131,902||126,603|
|Energy intensity5 (million BTUs per barrel)||1.27||1.28||1.31||1.39||1.38|
|Energy intensity reduction (% as compared to 1990)||6.6||6.3||4.8||1.0||1.6|
|EROEI (Energy Returned on Energy Invested)1||4.4||4.4||4.3||4.0||4.1|
|GHGs2,5 (million tonnes)||12.87||12.37||12.46||11.90||11.47|
|GHGs3,4,5 (million tonnes)||11.24||10.67||10.91||10.37||9.97|
|GHGs3,4,5 (tonnes CO2e per barrel produced)||0.11||0.10||0.11||0.11||0.11|
|GHGs3,4,5 (tonnes CO2e per cubic metre produced)||0.67||0.63||0.69||0.68||0.68|
|Alberta Carbon Payments6 ($ million)||21.18||14.36||26.73||19.90||19.73|