Oil Sands Commit $24 Billion to Phase 1 of Emission Reductions on Path Towards Net Zero

Oil Sands Commit 24 billion for phase one of emission reductions on the path to cover img

Canada’s oil sands operators have announced plans to spend $24 billion on emission-reduction projects by 2030 as part of their commitment to reach net zero by 2050.

The Oil Sands Pathways to Net Zero Alliance – accounting for 95% of oil sands production – has allocated $16.5 billion towards a massive carbon capture and storage (CCS) network in northern Alberta.

An additional $7.6 billion will be spent on research and development of other GHG-reduction technologies such as direct air capture, the viability of geothermal energy and small modular nuclear reactors, and various solvent applications to reduce the steam required for gravity drainage operations.

Kendall Dilling, President of the Pathways Alliance, says that strong collaboration between industry and government is required for the initiative to come to fruition, given that it requires significant up-front work and investment.

“We continue to work with the federal and Alberta governments to ensure Canada’s co-funding programs and regulatory environment for CCS are globally competitive and that emissions reduction targets for our industry are realistic and achievable,” said Dilling.

“At the same time, we are in the early stages of engagement with communities on how best we can move forward together on our plan.”

“In parallel, we’re progressing work to make sure we’re ready to make an investment decision and start building as soon as the necessary financial and regulatory conditions are in place.”

At the heart of the CCS network is a transportation pipeline which will gather carbon dioxide (CO2) from more than 20 oil sands facilities and move it to a proposed underground storage hub near Cold Lake, Alberta. The alliance expects to reduce annual emissions from operations by 22 million tonnes by 2030.

The CCS infrastructure – along with other reduction methods – will be deployed in three phases, with phase 1 ending in 2030 and each consecutive phase taking a decade to complete.

MYTH vs FACT - Carbon capture is critical for ensuring our transitions to clean energy are secure and sustainable

Pre-work on the Oil Sands Pathways foundational CCS project to date [1]:

> Early engagement with more than 20 Indigenous communities along the proposed CO2 transportation and storage network corridor and a commitment to meaningful engagement throughout the full cycle of the network’s operations.

> Selected by the Government of Alberta to continue exploratory work on the Alliance’s ambitious CCS hub to safely and permanently store CO2 captured from 20+ oil sands facilities and other interested industries in northern Alberta.

- More detailed work to evaluate the storage zone will soon begin.

- The proposed hub could eventually see more than 1.1 billion tonnes of CO2 safely stored deep underground in a saline aquifer – a critical lever in enabling the Alliance’s goal of net zero by 2050.

> Conducting engineering studies for the phase 1 CO2 capture facilities.

- Nine carbon capture feasibility studies involving member companies have been completed on oil sands sites, with engineering work advancing.

> Completed pre-engineering work on the 400-kilometre pipeline that will carry captured CO2 to the storage hub; more detailed engineering work is about to begin.

> Environmental field programs are underway to support regulatory application submissions for the proposed CO2 transportation line and storage network. The Alliance is planning to submit those applications in late Q4 of 2023.

More than 200 engineers, scientists and experts from Pathways Alliance companies are working on the items above and more tasks not listed to advance technologies and achieve net zero by 2050, according to the alliance.

Oil Sands Pathways to Net Zero: 3 Phases

oil sands pathways to net zero stages - phase one to three (2020 to 2050)

Courtesy of Oil Sands Pathways to Net Zero Alliance

The first phase includes a balance between CCS deployment, process and energy efficiency improvements, electrification and fuel substitution and an assortment of other emission reduction methods, as shown above.

Phase two and three include a much stronger focus on CCS, accounting for roughly half of the total emission-reduction commitments by the alliance.

Global Oil Demand is Growing

By pursuing a path to net zero, Canada’s oil sands sector is positioning itself as a long-term, go-to supply source for the world’s oil needs.

The International Energy Agency, U.S. Energy Information Administration and several other reputed organizations have all released recent analyses projecting global oil demand to continue growing for years to come.

Despite increased electric vehicle sales and renewable power deployment, crude oil’s use as a source of energy and material will be needed for decades yet.

Canada is a stable, reliable and democratic producer of oil, natural gas, lumber, minerals, metals, aquaculture, food, and everything in between. In a world where sustainable and secure supply chains are of the utmost importance, Canada is a clear choice to provide the world with the natural resources it needs.

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Pathways Alliance – Pathways Alliance advances net zero emissions plan, Date Accessed: October 25th, 2022 (https://pathwaysalliance.ca/news-release-22oct14/)

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