Canadian Oil Sands Energy: Time for Bold Action

A 50% reduction in carbon intensity and climate impact?  

Why not?

It is time to stop tinkering at the margins and let’s set bold goals to get Canadian Oil Sands energy to market AND make it palatable in our increasingly carbon and climate focused world.

Canadian Oil Sands are one of the world's largest petroleum reserves, and the only major reserve located in a politically stable region.  A major investment in improving the carbon/climate impact would pay dividends to Alberta, Canada and the world for decades.

We’ve seen that no matter how loud governments cheer for the project, or how friendly they make environmental rules, the pipelines just don’t seem to get approved.  Climate change and carbon are increasingly important to society.  Dirty energy, as the oil sands have been branded, can expect increasing opposition and challenges at every step, from inside Canada and globally

This won’t change anytime soon.  Unless the oil sands industry embraces carbon and climate issues and takes them head on.  And, with the economic malaise Canada and Alberta is in, and provincial and federal governments poised to make strategic interventions, this is a perfect time.

It is time for industry and both levels of government to come together and accept and finance the challenge of making oil sands energy acceptable to a carbon conscious public.

A good starting point is to determine the carbon, GHG and climate impact intensity of the industry today.  There seems to be a lot of confusion and misinformation around this issue so let’s clear it up.  Whatever the number is, let’s know it and let’s accept that it has to improve.  A lot.  A real, real lot.

How can it be improved?  I don’t know, but I know it can’t be improved and won’t be improved unless industry and government come together, commit to improving it and invest heavily to achieve that commitment.

What would happen if they agreed to cut the carbon, GHG and climate impact intensity of oil sands industry by 50% in 5 years?   It would be a huge step forward in gaining (or regaining) a global social license for the industry.

Canadian scientists, engineers, universities and research facilities would be resourced and motivated to develop new technology and processes that would not only apply to the oil sands but would have impact across other industries and sectors struggling to reduce their impact. 

New technology and solutions would be developed by Canadians and could be applied in other industries and other sectors, supporting Canadian business and carbon management.  Canada would continue moving away from its former status as a climate change laggard.

What would it cost to cut impacts by 50%?  I don’t know.  Billions I guess.  But, what is the alternative.  The public and markets won’t get less interested in the environmental impact.  Pipeline permits won’t magically appear. 

I suspect that if Industry and government doesn’t take this issue head on with a BHAG (Big Hairy Audacious Goal) that they all embrace, we will see much of the energy from oil sands remain untouched, costing the provincial and national economy far more than it would cost to take the challenge head on.

So, let’s just do it.  Embrace a 50% reduction in the climate impact of the oil sands industry by 2022.

Canadian Oil Sands are one of the world's largest petroleum reserves, and the only major reserve located in a politically stable region.  A major investment in improving the carbon/climate impact would pay dividends to Alberta, Canada and the world for decades.

Canadian Oil Sands - lesser of several evils

Clumsy government support of Canadian Oil Sands industry is hindering the industry's development and risking its social license

Originally published in Triple Pundit - http://bit.ly/1NgKIkJ 

The Canadian Oil Sands industry is under global pressures from social and environmental fronts.  And this is at a time of plunging global oil prices that are eroding the industry’s financial license.

Foreign governments, markets, NGOs, celebrities and others are actively protesting the operation and expansion of the industry, focused mainly on the carbon cost that is embedded in the energy from carbon-intensive production and processing methods.

It is interesting that these groups are targeting Canadian oil sands production when energy from other areas, like the Middle East, comes with unacceptable levels of human rights, conflict, military and other costs.

Few seem to be doing the calculus that would objectively compare the socio-environmental cost of Canadian oil sands and Middle Eastern energy production.  I strongly suspect that it is much easier to address the carbon and environmental impact of the oil sands than it is to address the human rights, conflict and military costs of Middle Eastern energy.

I also suspect that part of the reason that the carbon calculus versus the human rights and conflict calculus isn’t done is (at least partly) because Canadian government ‘support’ and Canada’s emergence as a climate change dawdler has helped to make the oil sands an easy international target.

The industry is in much difficulty, despite, or as a result of, a national government and regulator that has been a strong cheerleader for nearly 10 years.  It is facing global activism and opposition and has not been able to get its production to global markets.  Pipelines are stalled, and market access looks increasingly difficult.

These are directly related and have created an, at best, very tenuous social license for the industry.  The Canadian government, who is also the national regulator, has supported the industry in ways that have undermined its environmental credibility globally.

Recent revelations in the Guardian put more strain on the government’s role as an objective regulator and give fuel to opponent’s arguments.

A robust industry requires technical and economic viability as well as some level of societal acceptance.  An industry with international and global markets requires societal acceptance and an industry social license.

While individual projects and companies can, and do, develop their own project- or brand-level social license, many industries also need some level of industry social license.

In order to achieve societal acceptance (social license) industry must be seen to be making a net positive contribution to society and have an acceptable environmental risk and cost.  Notice I said ‘be seen to be making a net positive contribution.’  Perception is reality.

The oil sands is a carbon-intensive industry, and carbon and climate change are increasingly critical global issues.

In the case of the Canadian Oil Sands, there is a public perception (domestic and global) that the industry is a global environmental bad-boy.

The Canadian government’s support for the industry, including considerable tinkering with environmental regulation, coupled with the carbon-intensive nature of the industry, has given industry critics plenty of ammunition and credibility.

Canada’s increasing laggardness on the global climate change file has further eroded the perceived credibility of our environmental regulatory system, and, as a direct consequence, the trust that the Canadian and global public has in the environmental performance of key industries such as the oil sands.

If Canada wants to see the socio-economic benefits of a socially and environmentally responsible oil-sands industry, it needs to start by rethinking how it is supporting the industry and how it is engaging in the global climate change issue.

It may be counter-intuitive, but more stringent and credible environmental regulations will help the industry rather than hurt it — and, hopefully, force opponents to do the hard, but important, work of comparing the socio-environmental costs of energy from Canada’s oil sands with energy from the conflict-ridden Middle East.

Oil sands with an environmental impact that can be improved, or Middle Eastern energy with a conflict and human rights impact that is a lot more difficult to deal with?

I suspect that comparison would favor Canada’s oil sands and also push them to better address their carbon intensity — and at the same time take a small bit of fuel from the Middle East tinderbox.

Wayne Dunn is  President & Founder, CSR Training Institute and Professor of Practice in Corporate Social Responsibility, McGill University. You can sign up for the CSR Training Institute newsletter here and read more from him here.

Some of my recent tweets on CSR and Sustainability

A few people have asked me to put my recent tweets into a document so here they are.

Follow me here https://twitter.com/ZINGmore if you want to get future tweets in real time.

Win/lose = Lose/lose. Sustainable business wins by helping others to win too. Broad value propositions = long-term sustainable value. Read more at http://bit.ly/CSRknowledge

11 Sustainable U.S. Wineries. Feel good about feeling good. Everyone wants more reasons to buy & enjoy good wine. Great article by Mary Mazzoni of Triple Pundit http://bit.ly/1xGhAGK

Increasing costs. Increasing complexity. Uncertain value generation.

Is this what your CSR looks like? http://bit.ly/1C5TES1

National Hockey League in top 20 of EPA’s Green list. Global first for a sports league! http://bit.ly/1C1Kqns  

Read 2014 NHL Sustainability Report http://bit.ly/1zgieuT  to see more of the league and the team’s sustainability efforts. And, the NHL and its teams and players do even more.

The players, teams and league make a major social impact with their support for communities, youth and causes. And, they do it very quietly and without calling for attention. This analysis argues that they could create more value for themselves if they weren’t so quiet about it. http://bit.ly/1BOqCDZ

CVS continues tobacco free support. Great alignment of social value and corporate core. http://bit.ly/1xtieaq  @EileenBooneCSR @CVSHealth It is great to see companies step up to the plate on creating social value and do it in a smart way.

The CVS contribution of $5 million to Campaign for Tobacco-Free Kids is great alignment with their corporate core. It is great to see fewer corporate CSR contributions that look like they were selected on a whim by the CEO’s new mistress! Smart companies align CSR outreach and investments with their corporate core.

Done something amazing in sustainability/CSR last year?

Tell the World!  Enter 2degrees Champions Awards. Let the world know about it and give you feedback. http://bit.ly/1LQOSgH

Market driven waste management. Financial & environmental performance.

Great article by Alexis Petru @triplepundit http://bit.ly/1yJVbtu

CSR Beyond Beads n Trinkets. Think before you spend.

See more #CSRKnowledgeCentre http://bit.ly/CSRknowledge

CSR: Create, don’t just donate.

CSR should create value for shareholders AND society

See more #CSRKnowledgeCentre http://bit.ly/CSRknowledge

Patagonia-Aligning CSR with brand, market & impact Authenticity pays!

Great short read http://bit.ly/1zy22bX  by @marcstoiber

Recycled water into beer!

Sustainability that is easy to support http://bit.ly/18Ffhz0  @LeonKaye @triplepundit

Perfect for the Super Bowl

Progress not perfection.

This and other efforts are adding up to big differences in supply chain sustainability http://bit.ly/1EXvrOM  

Stopping Hazardous Chemicals from Entering the Supply Chain By Padma Nagappan — February 01, 2015 The $11 billion parent company of brands such as North Face, Timberland, Nautica, Lee and Wrangler has debuted a chemical management initiative that could be a game changer for the industry, as it scales the program across its vast supply chain and invites the industry to take advantage of it.

Super Bowl and sustainability.

Quick insights and history at http://bit.ly/1CM6iqI  Courtesy @GreenBiz

Mars Rocks on Supply Chain Sustainability

Mars continues to push on sustainable supply chain (beef, pulp, paper, soy) http://bit.ly/1Lsvsi0  @marsglobal @EUAfricaMonitor

It was great to see them winners at the EU-AFRICA Chamber of Commerce CSR Awards Gala in Brussels in November.  See video https://www.youtube.com/watch?v=0P6MfGhLRKI

And congrats to EU-AFRICA Chamber of Commerce creating the event to showcase the work of Mars, Newmont, DHL and the other winners

ICMM opens commenting period on updated Indigenous Peoples and Mining Good Practice Guide @ICMM_com http://bit.ly/1yMtmj7

Did you know the NHL is a global leader in sustainability?

Full carbon offset for one http://bit.ly/1CGUvty  more @NHLGreen GREAT leadership

Is CSR about distributing, creating or sharing value or all three?

Discussion & thoughts here. http://bit.ly/CSR_Value

Role of mining in national and emerging economies.

Interesting @ICMM report https://lnkd.in/eZFNvyv

CSR SWOT: discover risk, value and more

See new LinkedIn Post if interested https://lnkd.in/bX7V4na

Well done is better than well said!

CSR Communications must be free of Socialwash or Greenwash. 11 Mistakes to avoid http://bit.ly/1qQMM9t

Food for thought – 13 Sustainability trends for 2015

http://bit.ly/1GvgN5T  by Richard Mazzola Quick read

Viewpoints for Business in 2015 - Progress and Purpose.

Interesting Webinar discussion from @GlobeScan http://bit.ly/1CKGitY

Best Ever or Worst Possible: The Canadian Oil Sands

This post might seem out of character for me but I have become so frustrated by such an important issue being communicated so badly.  

Best Ever or Worst Possible:  The Canadian Oil Sands

Development of the Canadian oil sands is the worst: unsound, unethical, anti-planet and pretty much everything else

Or

Development of the Canadian oil sands is the absolute best alternative for our petroleum addicted world.

Let me start by saying three things.

1.      I really don’t know much about the development of the oil sands, at least not enough to claim any sort of expertise.

2.      I think that we are all addicted to petroleum and that is not a good thing.  But, have I haven’t seen anything from the stop the oil sands group that suggests that stopping the oil sands will help this issue.

3.      I don’t believe that stopping the development of the Canadian oil sands will curtail our global appetite for petroleum produced energy but would simply mean that we would get more of it from elsewhere.

For me this means that the central question in the oil sands debate is about should we consume petroleum energy from the oil sands, or from somewhere else.

Like many of you, or at least those of you from North America, I’ve been bombarded by terribly polarized opinions on the development of the oil sands.

It is frustrating.  This is important stuff.  Yet, neither side seems adult enough to present a well-reasoned argument, or at least they haven’t connected a well-reasoned argument to a communications plan which meant that you could actually hear it

·         We have some industry infomercial like ads on TV that make it seem like just the best thing ever.  No need to ever be concerned about anything.

·         We have a Canadian government who, in their clumsy attempts to assist the industry, have made it seem like they are willing to throw environmental regulations and safeguards out the window to support quick project approval.

·         And then there is the steady parade of over-paid movie stars and celebrities, prancing through the media telling us how absolutely earth and civilization ending terrible the industry is.

·         Can anyone tell me how being a famous celebrity makes you an expert on this subject?

Does anyone else wish that one or more of the key stakeholders was mature enough to trust that some comparative facts and objective (or even partially objective) information would be helpful?

Here are some things I wish that they would tell us

On Environment

Petroleum production has nasty, terrible even, impacts on the environment.  Not just in Canada but globally.  Sure, it is getting better, but not nearly fast enough. 

I wish we had a different way to power our planet and hope that we will soon get to one.  But, in the interim, let’s think about this rationally.

I want to know the comparative environmental impact of oil sands petroleum and that from elsewhere.

·         Carbon: What is the carbon cost per barrel of oil, delivered to where it will be used for oil sands petroleum?  How does that compare to petroleum from other major global oil fields

·         Carbon: How is the carbon cost per delivered barrel changing over time from the oil sands and other producers?  In other words, who is investing in reducing their carbon impact?

·         Water and other Natural Capital / Global Commons inputs:  Similar to carbon.  How much is used per barrel (delivered to where it will be used) and how does that compare to other major global oil fields.  What are the trends?  Which fields are getting more efficient at using Natural Capital.

·         Overall impact: How can we quantifiably compare the overall environmental impact of energy from the oil sands with energy from alternative locations; including the cost of transporting it to the end user

And, while we are on the environment can anyone explain why nobody is assessing and monitoring the cumulative impact of oil sands development on the production areas and all the way downstream through the Athabasca, Slave and Mackenzie River systems.

On Human Rights

Much of our planets remaining petroleum reserves are in places that don’t win so many human rights awards. 

Syria, Iraq, Russia, Saudi Arabia and a host of other producing countries have some pretty dismal human rights records.  And, let’s be honest, our western companies and governments have cozied up to these regimes and their human rights track records to get access to their petroleum energy.

To me a key question is around whether we’d sooner use petroleum energy coming from countries and locations with better human rights records.

I think we need to figure out how we can quantifiably compare the human rights/petroleum energy issues so we can have a rational discussion about this dimension.

On Global Security

I’m probably in a bit over my head on this issue, but, on the simplistic side, when I hear that ISIS is funded by millions of dollars/day of petroleum revenue I think that isn’t a good thing.

When I see the conflict all over Syria and Iraq that, as I understand it, is financed by if not fueled by petroleum, I think that is not a good thing.

There may be other relevant dimensions but these are three key ones.

Overall, I believe we are better off using petroleum energy that has less, rather than more environmental impact in its production and transport and that comes from more stable countries with better human rights records.

Intuitively I feel that this means developing the oil sands but I would really like to see some research and informed debate around it.

Surely it isn’t asking too much of industry, government, NGOs and celebrities to be supportive or informed and rational debate around such an important issue?

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