Recent statements by the CEO of a major oilsands company further the case for federal regulations to cap greenhouse gas emissions in the oil and gas sector, Environment Minister Steven Guilbeault said.
In an interview with The Canadian Press, Guilbeault called the August 15 comments by Suncor CEO Rich Kruger “disappointing,” particularly in the middle of a summer when “tens of thousands of Canadians” were forced to flee wildfires and global temperatures hit record highs in July.
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“To see the leader of a great Canadian company say that he is basically disengaging from climate change and sustainability, that he’s going to focus on short-term profit, it’s all the wrong answers,” Guilbeault said.
“If I was convinced before that we needed to do regulation, I am even more convinced now.”
This fall, Guilbeault intends to publish draft regulations to cap emissions from oil and gas production and then force them downward over time. Oil and gas contributed 28% of Canada’s total emissions in 2021, and the oilsands alone account for 13%.
Suncor contributed 17.4 million tonnes, or 2.5% of the national total, CP says, and the company’s emissions in 2021 were 50% higher than they were in 2011. Canada’s total emissions have fallen just 6% compared with 10 years ago.
Guilbeault hasn’t yet said exactly what the first cap will be, but the Emissions Reduction Plan published in 2022 included a cut of more than 40% to oil and gas emissions by 2030.
Kruger, who took over as Suncor CEO in April, told investors during Suncor’s second-quarter results conference call that the company had a “disproportionate” focus on the longer-term energy transition to low-emitting and renewable fuels.
“Where we stand is we judge that our current strategic framework… is insufficient in terms of what it takes to win,” he said, according to a transcript of the call posted on the company’s website.
That included, he said, a “lack of emphasis on today’s business drivers.”
“Today, we win by creating value through our large integrated asset base underpinned by oilsands,” he said.
He promised a “revised direction and tone” focused more on the immediate financial opportunities in the oilsands.
In that same call, Suncor reported second-quarter earnings of C$1.9 billion, down from $4 billion in the second quarter of 2022, when oil prices soared following Russia’s invasion in Ukraine.
Kruger said the company remained committed to the Pathways Alliance, the consortium whose six members account for almost all of Canada’s oilsands companies production and say they’re working together to install carbon capture technology and reach net-zero emissions by 2050. They’ve steadfastly refused to invest their own record profits in that work, insisting instead on ever more lavish taxpayers subsidies to cover costs.
Pathways executives have long claimed they want to contribute to Canada’s climate targets, but that the federal timeline for cutting their emissions is unrealistic.
Both Suncor and Pathways were approached for comment for this story but neither responded.
Kruger’s comments come almost a year after his company announced it would sell off its wind and solar power assets, ending its two-decade long foray into the renewable energy business. Earlier this year, Suncor expanded its oilsands operations when it bought the Fort Hills oilsands mine from Teck Resources and TotalÉnergies.
Guilbeault said the federal government isn’t asking the oil and gas sector to do more than its fair share, and is not singling it out. He noted zero-emission vehicle regulations being finalized now require one in five new vehicles sold to be electric by 2026, and bar the sale of new combustion engine cars and trucks in 2035.
Draft regulations to eliminate emissions from Canada’s electricity sector were published earlier in August and are still in the comment period.
The oil and gas cap regulations were expected already, but Guilbeault acknowledged they have been delayed.
“It is a complex piece of regulation,” he said.
But the minister said they are coming, and industry has to do its part.
“I don’t think in 2023 you can be a good corporate citizen and not play your role,” he said.
The main body of this report was first published by The Canadian Press on August 29, 2023.
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