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Emission rules not needed TransCanada, Imperial take issue with new climate change regulations by Alberta and Canada; Girling argues for pipeline exemption GARY PARK For Petroleum News
TransCanada and Imperial Oil, two of Canada’s largest energy companies, agree that a legislated limit on greenhouse gas emissions from the oil sands is an unnecessary part of climate change plans by the Canadian and Alberta governments.
Russ Girling, chief executive officer of TransCanada, said new federal requirements that take into account upstream emissions related to pipeline proposals are not needed.
He said oil and natural gas exploration and production projects are already subject to rigorous regulations, suggesting that regulatory reviews of pipeline applications should concentrate instead on safety and spill response measures, rather that dealing with issues that are not germane to pipelines.
“The emissions, both upstream and downstream, are reviewed in other regulatory processes, when those facilities themselves are approved,” Girling told his company’s annual meeting. “Once approved, all we do is move that product from A to B.”
He said that the federal moves to expand reviews will eventually determine that building a pipeline does not have any impact on the rate of growth for oil and natural gas production or the downstream refining and processing of those resources.
But Girling said he hopes the efforts by the Alberta and Canadian governments to cap and lower carbon emissions will help reduce the public “noise” around the issue as it relates to pipelines.
Imperial has similar view At Imperial’s annual meeting, Chief Executive Officer Rich Kruger adopted a similar stand, although his concerns were more specifically directed at the Alberta governments plan to impose a C$30 per metric ton levy on carbon emissions.
When the plan was unveiled last November, Imperial pointedly refused to appear with other major producers - notably Suncor Energy, Cenovus Energy, Canadian Natural Resources and Royal Dutch Shell - in aligning themselves with Alberta Premier Rachel Notley.
“We didn’t think the cap was necessary,” he said. “The climate leadership plan in Alberta has many aspects, many of which we think are really good. The cap is not one of those.”
Kruger said he believes there is room to negotiate with Alberta on rules around the 100 million metric ton per year emissions limit, of which the industry currently accounts for about two-thirds.
He said Imperial thinks there were other ways to improve environmental performance and, to that end, the company is working with the provincial government to “put the right regulations in place so industry overall can maximize production under the cap, achieve the objectives the government has set out and do it in a way that is acceptable to industry. So the message is: ‘Stay tuned.’”
Otherwise, he said much has to be resolved on the proposed cap, including how projects that have already received regulatory approval will be treated.
Imperial’s own initiatives include the use of solvent assisted technology to reduce GHG emissions below steam-driven facilities at its Cold Lake thermal recovery project in northeastern Alberta.
Imperial production in the first quarter averaged 421,000 barrels of oil equivalent per day, up 98,000 boe per day a year ago, which was accomplished while the company slashed its costs by C$1.5 billion without laying off a single employee.
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