Canada’s oil industry is requesting the government to financially aid their green initiatives as they struggle amid the COVID-19 downturn. Canada, the world’s fourth-largest crude producer, extracts most of its oil from hydrocarbon-soaked sands which incur a high environmental cost. Analysts said that Canada emits the highest emissions per barrel compared to other major oil-producing countries.
The coronavirus pandemic has forced Canadian oil producers to cut their spending, including on projects aimed at cutting emissions. Now, two of them are requesting financial support from the federal government for their green initiatives. Suncor Energy is seeking government investments in some projects, including a project to replace petcoke-fired boilers with gas-fueled ones, that are expected to cut the company’s CO2 emissions. However, the project was suspended as Suncor tried to conserve cash.
Suncor is also in talks with Ottawa investments in building small nuclear reactors to provide oil sands operations in Alberta with power supplies. The talks also envisage a potential project to build facilities that capture carbon emissions. The technology to run small nuclear reactors are still under development, and they have not been deployed worldwide.
Another Canadian oil producer, Husky, is seeking investment from the federal government in its project off the Atlantic coast. Husky expects the project to be the country’s first “net-zero facility.” but suspends it due to economic uncertainty.
Canada’s oil sector accounts for 7% of its GDP. However, the pandemic hurt the industry, with Alberta producers’ output currently 16% below pre-pandemic levels. Suncor said it would lay off 15% of its workers through 2021. Oil sands producers have managed to reduce CO2 emission per barrel production by 20% between 2005 and 2018, but combined emissions grew by 22% over the same period.
