Cutting the greenhouse gas emissions from Canada’s oil sands to net-zero will cost CAD75 billion ($60 billion), with taxpayers expected to bear a large chunk of the estimated costs, according to two of the industry’s top executives. Mark Little, the CEO of Suncor Energy Inc, said carbon capture and sequestration would cut half of the emissions from Canada’s oil sands. However, it would require as much as two-thirds of government capital. According to Alexander Pourbaix, the CEO of Cenovus Energy Inc, the project will be too significant an undertaking, and the company could not go at this on their own.
Canada’s oil sands contain the world’s third-largest crude reserves. However, extracting them requires carbon-intensive methods, which make them an easy target of environmental activists and climate-minded investors. The sector emits nearly 70 million tons/year of CO2, accounting for around 10% of Canada’s total emissions.
The initiative to cut those emissions receives support from Canadian Natural Resources Ltd., MEG Energy Corp. and ExxonMobil’s Imperial Oil. The project will include switching the fuels used to extract oil, using solvents to improve the efficiency of crude hauling, and employing small-scale nuclear reactors to produce steam, Pourbaix said.
The carbon capture and sequestration project will include building a trunk line to carry the captured CO2 from oil sands facilities to a nearby carbon sequestration hub. The line is estimated to cost CAD1 billion-2 billion ($0.8 billion-1.6 billion) and could enter service by the middle of the decade. Capturing CO2 is expected to require the most investment of up to several hundred dollars per ton, the companies said. The initiative does not cover Scope 3 emissions, which are generated from fossil fuels when used by end-users.
