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Tar Sand Companies Aim to Reduce Greenhouse Gas Emissions

With the environmental impact of Canada's oil sands under increased scrutiny thanks to the Keystone pipeline, producers band together



http://www.leahy.senate.gov/

The world's largest oil sands producers signed an agreement yesterday to waive their intellectual property and patent rights in order to reduce the industry's impact on greenhouse gases, agriculture and waterways.

Twelve companies -- including Royal Dutch Shell PLC, Cenovus Energy Inc. and ConocoPhillips Co. -- formed Canada's Oil Sands Innovation Alliance (COSIA) to eliminate redundancy in their research operations. The intent is for the participating companies -- which represent more than 80 percent of Canada's oil sands production -- to no longer keep certain technologies proprietary so that each company essentially is working on a different aspect of the oil sands' environmental footprint.

The announcement comes as Canada's oil sands region is under intense scrutiny for its climate impact in the wake of the debate over Keystone XL, a pipeline that would have run from Canada to Texas before being denied a permit by the Obama administration.

In recent months, Canadian national officials have slammed the industry's critics, accused environmentalists of being socialists and pledged to move the company's oil commodity to China. Environmentalists, meanwhile, expressed skepticism yesterday that the new coalition would achieve much, since the national government has not followed through on promises to formally regulate oil sands emissions.

In an interview with ClimateWire the alliance's new chief executive, Dan Wicklum, said his group was purely focused on being a new innovation hub. "I'm not a lobbyist and will not be," he said. But he said the member companies were paying close attention to the debate.

"Public opinion is a fickle thing. The 12 member companies are taking it very seriously," he said. They want to be singing from a "single song sheet."

The coalition's charter, released at a press event in Calgary, Alberta, states that the corporations will set specific goals on how to improve environmental quality in four areas: greenhouse gas emissions, land, water and tailings ponds created by industrial waste. The group also would "provide visible leadership" and "accelerate the pace and scope" of environmental innovation, according to the charter.

Carbon capture is one goal
As an example, the group said it would be collaborating on a project to perfect technology that would capture carbon dioxide emissions from burning natural gas to generate steam, which is used to loosen gooey petroleum out of Albertan sand formations. The greenhouse gas emissions of the oil sands are higher than those of traditional oil drilling, largely because of the industry's reliance on combusting natural gas.

In theory, the coalition could work by one company offering up a patent on a new technology to reduce emissions in the oil sands, explained Wicklum. Other companies -- which currently keep their research information private -- would then find out if they were developing a similar technology. In that case, the other companies might cease operations in that area, focus on other research angles and allow one company with the most advanced research to take the lead on the specific technology.

The coalition also will allow companies to more effectively present "project plans" to technology scientists in the Albertan and national governments, he said. Executive vice presidents from the 12 members would meet weekly as part of the initiative, he said. There was no new funding tied to the deal, but Wicklum said the information sharing would streamline existing research dollars.

Wicklum added that the information sharing agreement was developed by a "whole team of lawyers" to ensure that the participating companies would be able to compete normally in all other aspects, outside of improving environmental performance in the four targeted areas. The agreement passes muster under Canada's Competition Act, which guarantees Canadian consumers access to competitive prices.

A 'nice gesture,' or more?
Environmental reactions ranged from skeptical to angry. The pact is a "nice gesture" but comes at a time when the government won't force emissions reductions on the sector, said Gillian McEachern of Environmental Defence.

An analyst at Greenpeace Canada slammed the agreement as a way for industry to target lawmakers in the United States and Europe. In addition to the debate about Keystone XL, Europe is weighing whether to label oil sands fuels as 22 percent more carbon-intensive than traditional types.

"In the absence of any commitments to real reductions in pollution with penalties for not meeting them, this is simply another example of 'greenwash,' where an industry association makes vague promises to clean up its act in order to avoid regulations with real teeth," said Keith Stewart, climate and energy campaigner at Greenpeace Canada.

Green groups say that the oil sands singlehandedly threaten to undo Canada's climate targets to reduce emissions 17 percent by 2020. Greenhouse gas emissions are growing faster than any other sector in Canada and are likely to double annually by 2020, according to the Pembina Institute, an environmental think tank.

The announcement comes on the heels of a major initiative by the Albertan and Canadian governments to increase monitoring stations measuring how oil sands operations are placing pollutants in waterways, increasing emissions and altering wildlife patterns (ClimateWire, Feb. 6).

In addition to Royal Dutch Shell, Cenovus Energy and ConocoPhillips, the other participating companies are BP Canada Energy Co., Canadian Natural Resources Ltd., Devon Canada, Imperial Oil, Nexen Inc., Statoil ASA, Suncor Energy Inc., Teck Resources Ltd. and Total E&P.

Reprinted from Climatewire with permission from Environment & Energy Publishing, LLC. www.eenews.net, 202-628-6500

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