October 5, 2021: A team of international analysts pointed to a Canadian tar sands/oil sands operation as the most carbon-intensive by far in an index of major oilfields around the world, even as Alberta’s Canadian Energy Centre launched a Times Square ad campaign touting the country’s “friendly” oil.
“Choose friendly oil. Cleaner. Closer. Committed to Net Zero,” the C$240,000 video billboard campaign proclaims. But the ads landed just as S&P Global Platts unveiled a new monthly calculation of the carbon intensity and resulting carbon offset premiums for 14 major crude oil fields, including the 140,000-barrel-per-day Cold Lake facility, which Imperial Oil touts as “the longest running oil sands operation in Northeastern Alberta”.
The S&P Global Platts analysis adds another distinction to Cold Lake’s longevity: at 81.87 kilograms of carbon dioxide equivalent (CO2e) per barrel as of July 2021, Cold Lake is by far the most carbon-intensive of the 14 fields the firm looked at in North America, the Middle East, Africa, Europe, Latin America. Next up was the Kirkuk field in Iraq, at 58.84 kilograms per barrel, followed by North Dakota’s Bakken field at 30.86. The lowest-emitting, Norway’s Jan Sverdrup field, produced only 3.73 kilograms.
As a group, the 14 fields averaged 25.11 kilograms of CO2e per barrel, less than one-third of Cold Lake’s emissions intensity.
Deb Ryan, S&P Global Platts’ head of low carbon market analytics, said the 14 fields were selected to cover a “range of different producing oil fields, different regions, onshore/ offshore, conventional/ unconventional assets to show the potential range of carbon intensity for different fields.”
The figures were based on model estimates produced by Stanford University and intended as benchmarks “to bring transparency to the market,” she wrote in an email. “Given they are monthly numbers, if companies engage in activities that reduce their emissions footprint, then the carbon intensity numbers would reflect this” in future editions of the index.
For now, Ryan added, the estimates for key factors like methane emissions are based on modelling, not direct measurement. Based on recent research in Canada and elsewhere, that means S&P’s figures may be considerably lower than the facilities’ actual climate impact.
The calculations are also meant “to reflect the impact of greenhouse gas emissions from wellhead production to the storage terminal,” Platts said in its announcement, taking into account “the production, flaring and venting, maintenance activities, production processing, and transport to the storage hub to identify the main sources of emissions, relevant to specific operations.” So the totals leave out the 70 to 80% of the emissions in a barrel of oil that are released when the product reaches its final destination and is used as directed.
“Well-to-refinery-gate (or upstream) life cycle analysis estimates emissions from extraction and processing only—including diluting and/or upgrading as well as transportation to the refinery—but doesn’t include refining,” the Calgary-based Pembina Institute explained in a March, 2020 report [pdf] on Canada’s tar sands/oil sands in a carbon-constrained world.
“Well-to-tank analysis assesses emissions from extraction through to the delivery of a transportation fuel to the tank of a vehicle, but doesn’t include the emissions associated with burning that fuel. Finally, a well-to-wheel life cycle analysis accounts for all associated emissions, including fuel combustion in a vehicle’s engine, and represents the most common and the best way to compare the emissions intensity of various crudes.”
The Pembina team cited a peer-reviewed study by Stanford University in 2018 that identified Canada as the world’s fourth most carbon-intensive oil producer based on well-to-refinery emissions. They also reviewed separate indices produced by the Carnegie Endowment for International Peace and the California Air Resources Board that pointed to Cold Lake as one of the most carbon-intensive production operations, in Canada or anywhere else.
Since then, there have been no major improvements in the emissions intensity of Canadian crude oil that would result in a significant shift in their global ranking, or in the emissions intensity of other grades of crude elsewhere, Pembina staff told The Energy Mix this week. The emissions intensity of the extraction technique used at Cold Lake has been getting steadily worse since 2012, and the latest Alberta government data show the facility increasing its emissions intensity 29% and its absolute emissions 14% over that time—a trend Pembina says is “representative” of any installations that rely on the same cyclic steam stimulation (CSS) technique.
The main change since the March, 2020 report is that the Canadian industry now faces an “existential challenge,” the Pembina team said in an email. The International Energy Agency and others predict oil demand will “decline globally, and faster in North America”. The re-elected Trudeau government has promised a cap on fossil fuel emissions, with declining targets every five years beginning in 2025. And “net-zero standards set by investors for oil and gas are evolving and are more detailed in their expectations, which include clear short-term and long-term plans that show reductions in absolute emissions, including Scope 3 or end use emissions.”
That’s at a time when tar sands/oil sands operators seen their absolute emissions increase 137% since 2005 and have not been able to get them on a downward trajectory.
But none of that has stopped the Alberta government’s hapless fossil industry “war room” from forging ahead with its latest U.S. ad campaign. “The video billboards in New York City feature maple leaves pouring from a gas pump nozzle with the caption ‘Choose Friendly Oil’,” CBC reports, noting that the U.S. receives about 96% of Canada’s oil and gas exports. “The centre is asking Americans to write to the Joe Biden administration urging the U.S. government to lean on cleaner Canadian energy instead of requesting more production from Russia and OPEC countries like Saudi Arabia—as surging U.S. gas prices recently reached a seven-year high.”
The S&P Global Platts index included no oil production facilities in Russia. The sample Saudi site, the Ghawar oilfield, emitted 18.16 kilograms of CO2 equivalent per barrel, less than one-quarter the emissions intensity of Cold Lake (although neither of the fields is representative of its entire country’s oil output).
Those numbers didn’t seem to make it into the messaging from Canada’s Energy Centre CEO Tom Olsen. “We’re right here next door. And we’re cleaner. We’re closer and we’re committed to net zero. So turn your eyes our way,” he told CBC News. “We think we should meet the demand for energy that the United States needs over and above what they produce domestically. And frankly, for the rest of the world.”
Olsen added: “I would pit Canada’s industry against Venezuela, Saudi Arabia, Russia any day of the week.”
But not based on their respective greenhouse gas emissions, said University of Alberta energy and environmental economist Andrew Leach.
“You can read their statement of saying oilsands have gotten cleaner, but the oilsands barrels themselves relative to a global average are still pretty emissions intensive. So there’s not really a good way to reconcile what they’re saying at Times Square with what we know from the data,” Leach told CBC. “All of our data says that the average Canadian barrel is getting more emissions intensive.”
While emissions per barrel from the tar sands/oil sands have fallen 36% since 2000, CBC adds, Alberta’s overall emissions grew 61% between 1990 and 2019, driving a 21% national increase over the same period. “It’s pretty hard to argue that the average Canadian barrel has gotten cleaner over time,” Leach said. “Even though some of the oilsands barrels, in general, have gotten a little bit better, just by the fact that they’re becoming more and more of our overall picture, our overall picture is getting worse.”
CBC says the $240,000 Alberta taxpayers are involuntarily lavishing on the U.S. video ad campaign will buy two billboards in Times Square for a month, one along New York’s Grand Central Parkway for two weeks, and three outside a Washington, DC arena for two weeks.
But while Olsen said the war room would measure the effectiveness of the campaign by web hits, media coverage, and the number of advocacy letters it generates, Leach countered that “the audience for these ads isn’t in Times Square. The audience for these ads is in Edmonton and Calgary.”