Page 5 - NorthAmOil Week 15 2021

NorthAmOil COMMENTARY NorthAmOil

The decarbonisation
push is likely to put
pressure on oil and gas
producers in particular
– especially those
operating in Canada’s
oil sands.

appears determined to make future targets more and gas production,” Pourbaix said. “But don’t
of a priority for the country. look for us to become a late-entrant renewa-
The decarbonisation push is likely to put ble-power developer.”
pressure on oil and gas producers in particu- These sentiments are echoed by the other two
lar – especially those operating in Canada’s leading oil sands producers, Suncor Energy and
prolific oil sands. The resource has a reputation Imperial Oil. Suncor has said it is on track to
for being particularly emissions-intensive, and achieve its goal of cutting the emissions intensity
recent efforts by producers to address this have of its output by 30% compared with 2014 levels
done little to improve the oil sands’ public image by 2030. According to Suncor’s chief financial
globally. officer, Alister Cowan, it is also considering an
But even as certain international energy com- updated emissions target for beyond 2030.
panies set out plans to shift away from oil over Imperial, meanwhile, has indicated that it
the longer term, the leading oil sands producers could adopt the technologies being pursued
are reiterating their commitment to their core by its parent company, ExxonMobil, including
business – albeit with more of a focus on reduc- CCS and biofuel blending.
ing emissions. Last week, both Canadian Natu- “When it comes to wind farms and solar
ral Resources Ltd (CNRL) and Cenovus Energy farms, that’s not really in our wheelhouse,”
said they would set new goals for reducing their Imperial’s senior vice-president of finance, Dan
GHG emissions, but would not pivot towards Lyons, said. The leading oil
renewables, unlike their European counterparts. The comments from all of these company offi-
CNRL’s president, Tim McKay, said at the vir- cials illustrate that changes are being made as sands producers
tual Scotiabank CAPP Energy Symposium that both Canada and the international community are reiterating
his company’s corporate emissions-cutting goal step up efforts to decarbonise. Whether these
would be announced in the second quarter of changes will be enough to win over a sceptical their commitment
2021. public, however, is a different matter, and for
This comes after CNRL has already cut its car- now, anti-oil sands sentiment continues to make to their core
bon intensity per barrel by 18% between 2016 the operating environment more challenging
and 2020, according to McKay. He went on to for producers. business – albeit
say that CNRL considers carbon capture and This week, New York’s state pension fund with more of a
storage (CCS) as a way to further reduce its envi- said it was restricting investment in six Cana-
ronmental impact, but that it is not planning any dian oil sands companies – including Imperial, focus on reducing
major investments in renewables. CNRL and Cenovus – alleging that they have
“The preference is to stick with what we know not shown they are prepared for a transition to emissions.
and what we’re good at,” McKay said. “There’s a low-carbon future. The New York State Com-
going to be a need for oil long term.” mon Retirement Fund is the latest in a string of
Cenovus’ CEO, Alex Pourbaix, told the sym- investors to pull back from the oil sands over
posium that his company had similar plans to recent years. While its divestment of over $7mn
introduce new emissions reduction targets is comparatively small, it illustrates that oil
while remaining focused on oil production. sands producers still have a long way to go to
“Where we’re likely to remain is focused on oil prove their decarbonisation credentials.™

Week 15 15•April•2021 www. NEWSBASE .com P5