UCP officials have been warning for months that an emissions cap on Alberta’s oil sands amounts to a de facto production cut..Now an analysis by US advisory firm, S&P Global, has confirmed the worst fears, echoing what Premier Danielle Smith has been saying all along: that oil sands producers will likely have to cut up to 1.3 million barrels per day — at least 25% — to reduce Ottawa’s emissions targets of 42% by 2030..In response to the report, Smith called Ottawa’s timelines “unachievable,” tweeting: “With a reasonable timeline of carbon neutrality by 2050, Canada can use emerging tech and LNG export to lead the world in energy development and emissions reductions.”.“Ottawa needs to listen.”.On Saturday, Smith issued a lengthy statement that her government would not recognize net-zero mandates and oil production cuts “under any circumstance.”.“Alberta will not recognize any federally imposed emission-reduction targets for our energy and electricity sectors under any circumstances unless such targets are first consented to by the Government of Alberta."."Nor will Alberta recognize any right of the federal government to legislate or regulate in this exclusive area of provincial jurisdiction, or any area of shared constitutional jurisdiction, without the explicit approval of Alberta,” she said..According to its analysis, S&P says any mandated output cut would in turn result in the loss of between 5,400 and 9,500 high-paying jobs. The report only analyzed oil sands; not conventional oil or natural gas..Environment and Protected Areas Minister Rebecca Schulz echoed Smith’s statements..“The current federal targets for reducing energy sector emissions are unachievable, and essentially amount to a production cut,” she said in an emailed statement to Western Standard. .“We will not accept any federal production cut, and we will strongly oppose any attempts to drive billions of dollars in investments out of Canada that will result in tens of thousands of lost jobs from coast to coast-to-coast. Production cuts are bad for families, bad for the economy, and just plain bad policy.”.The S&P report suggested oil sands producers could feasibly reduce about 15 megatonnes of CO2 by 2030 based on technical and regulatory factors, including the amount of time it would take to scale up carbon capture and storage technology..That still leaves a gap of 29 megatonnes to meet Ottawa’s targets, putting at risk nearly all of the anticipated 800,000 to 1.3 million barrels per day of growth between 2019 and 2040..The report suggests carbon capture could make a meaningful contribution by 2035. Deployment of small modular nuclear reactors — to generate steam — could make a difference after 2040, it found..The Pathways Alliance, a cooperative of the country’s largest oil sands producers, amounting to 95% of Alberta’s output, has pledged to reach net-zero by 2050. The companies aim to spend about $24 billion by 2030, including $16.5 billion for a carbon capture and storage hub near Cold Lake..Another $7.5 billion is earmarked for other technologies including the use of solvents to replace water, geothermal, direct air capture and the aforementioned small nukes..In April, Pathway’s president, Kendall Dilling, endorsed the Alberta government’s emissions reduction and energy development plans that call for achieving net-zero by 2050 — not 2030, 2035, or even 2040..“We are particularly pleased with the province’s recognition that a coordinated approach with the federal government and industry is needed to compete with the United States, Europe and others for investment in wide scale carbon capture, utilization and storage deployment, essential to achieve emissions reduction goals.”.It's a message he’s sure to take to Environment and Climate Change Canada (ECCC) Minister Stephan Guilbeault when he travels to Calgary to meet government and industry officials later this week..On Friday, he said ECCC plans to unveil Ottawa’s plans to phase out subsidies for ‘unabated fossil fuels’ or those that lack a mechanism for capturing or reducing carbon emissions in time for the next COP28 meeting in Dubai this fall. Federal tax rebates for carbon capture would not be affected..Guilbeault was in Brussels last week to meet with his counterparts from the US, Mexico, the EU, China, India, Japan and the Middle East ahead of the summit, where Canada committed $450 million to a climate investment fund. .However, a separate bloc of ministers within that group issued a statement taking aim at carbon capture technology, among other efforts to reduce — not eliminate — fossil fuels..“Abatement technologies must not be used to green-light continued fossil fuel expansion, but must be considered in the context of steps to phase out fossil fuel use and should be recognized as having a minimal role to play in decarbonization of the energy sector,” said the ministers in the statement.
UCP officials have been warning for months that an emissions cap on Alberta’s oil sands amounts to a de facto production cut..Now an analysis by US advisory firm, S&P Global, has confirmed the worst fears, echoing what Premier Danielle Smith has been saying all along: that oil sands producers will likely have to cut up to 1.3 million barrels per day — at least 25% — to reduce Ottawa’s emissions targets of 42% by 2030..In response to the report, Smith called Ottawa’s timelines “unachievable,” tweeting: “With a reasonable timeline of carbon neutrality by 2050, Canada can use emerging tech and LNG export to lead the world in energy development and emissions reductions.”.“Ottawa needs to listen.”.On Saturday, Smith issued a lengthy statement that her government would not recognize net-zero mandates and oil production cuts “under any circumstance.”.“Alberta will not recognize any federally imposed emission-reduction targets for our energy and electricity sectors under any circumstances unless such targets are first consented to by the Government of Alberta."."Nor will Alberta recognize any right of the federal government to legislate or regulate in this exclusive area of provincial jurisdiction, or any area of shared constitutional jurisdiction, without the explicit approval of Alberta,” she said..According to its analysis, S&P says any mandated output cut would in turn result in the loss of between 5,400 and 9,500 high-paying jobs. The report only analyzed oil sands; not conventional oil or natural gas..Environment and Protected Areas Minister Rebecca Schulz echoed Smith’s statements..“The current federal targets for reducing energy sector emissions are unachievable, and essentially amount to a production cut,” she said in an emailed statement to Western Standard. .“We will not accept any federal production cut, and we will strongly oppose any attempts to drive billions of dollars in investments out of Canada that will result in tens of thousands of lost jobs from coast to coast-to-coast. Production cuts are bad for families, bad for the economy, and just plain bad policy.”.The S&P report suggested oil sands producers could feasibly reduce about 15 megatonnes of CO2 by 2030 based on technical and regulatory factors, including the amount of time it would take to scale up carbon capture and storage technology..That still leaves a gap of 29 megatonnes to meet Ottawa’s targets, putting at risk nearly all of the anticipated 800,000 to 1.3 million barrels per day of growth between 2019 and 2040..The report suggests carbon capture could make a meaningful contribution by 2035. Deployment of small modular nuclear reactors — to generate steam — could make a difference after 2040, it found..The Pathways Alliance, a cooperative of the country’s largest oil sands producers, amounting to 95% of Alberta’s output, has pledged to reach net-zero by 2050. The companies aim to spend about $24 billion by 2030, including $16.5 billion for a carbon capture and storage hub near Cold Lake..Another $7.5 billion is earmarked for other technologies including the use of solvents to replace water, geothermal, direct air capture and the aforementioned small nukes..In April, Pathway’s president, Kendall Dilling, endorsed the Alberta government’s emissions reduction and energy development plans that call for achieving net-zero by 2050 — not 2030, 2035, or even 2040..“We are particularly pleased with the province’s recognition that a coordinated approach with the federal government and industry is needed to compete with the United States, Europe and others for investment in wide scale carbon capture, utilization and storage deployment, essential to achieve emissions reduction goals.”.It's a message he’s sure to take to Environment and Climate Change Canada (ECCC) Minister Stephan Guilbeault when he travels to Calgary to meet government and industry officials later this week..On Friday, he said ECCC plans to unveil Ottawa’s plans to phase out subsidies for ‘unabated fossil fuels’ or those that lack a mechanism for capturing or reducing carbon emissions in time for the next COP28 meeting in Dubai this fall. Federal tax rebates for carbon capture would not be affected..Guilbeault was in Brussels last week to meet with his counterparts from the US, Mexico, the EU, China, India, Japan and the Middle East ahead of the summit, where Canada committed $450 million to a climate investment fund. .However, a separate bloc of ministers within that group issued a statement taking aim at carbon capture technology, among other efforts to reduce — not eliminate — fossil fuels..“Abatement technologies must not be used to green-light continued fossil fuel expansion, but must be considered in the context of steps to phase out fossil fuel use and should be recognized as having a minimal role to play in decarbonization of the energy sector,” said the ministers in the statement.
