New 170.00 carbon tax Keyera is very exposed to the new tax. This is probably why they are pursuing low carbon deals with Samsung Renewables to reduce their exposure. Article below is from the National Post today.
Oilsands emissions intensity 35% lower than reported and could drop another 19%, new study says Study comes as industry looks for ways to reduce emissions in the face of looming 500% increase in carbon prices
Author of the article:
Geoffrey Morgan
Publishing date:
Dec 17, 2020 • Last Updated 2 hours ago • 3 minute read
The Canadian oil industry is widely expected to pour billions into emissions reducing technology in the coming years after Ottawa last week announced it would hike its carbon tax by more than 500 per cent. Photo by Vincent McDermott/Fort McMurray Today/Postmedia Network
CALGARY – The Canadian oil industry is looking for ways to reduce emissions in the face of a looming 500 per cent increase in
carbon prices, and a new study funded by the government of Alberta predicts oilsands emissions intensity could be cut by almost 20 per cent.
The study, released Thursday by researchers at the University of Calgary, University of Toronto and Stanford University, predicts that new techniques for producing bitumen from steam-based oilsands facilities can reduce the carbon intensity of those barrels by 14 per cent to 19 per cent.
Funded by Alberta Innovates and Emissions Reduction Alberta, two provincial government agencies, the study also said oilsands emissions intensities are already up to 35 per cent lower than previously reported.
“Given current climate targets and ambition to reduce GHG emissions globally, there is an increasing need to transparently demonstrate baseline GHG emissions and reductions achieved over time,” Joule Bergerson, one of the report’s authors and a University of Calgary chemical and petroleum engineering professor, said in a release. “The emerging technologies assessed in this study show reductions on the order of 14 to 19 per cent in upstream emissions and one to two per cent on a full cycle basis.”
Bergerson, who is also Canada Research Chair in energy technology assessment, added that more accurate emissions models will help policy-makers “in making better climate-wise decisions.”
The study compared 2018 to 2015 emissions from multiple oilsands projects operated by MEG Energy Corp., Canadian Natural Resources Ltd. and Imperial Oil Ltd. The researchers found carbon emissions intensities are 14 per cent to 35 per cent lower than data presented in a previous study, which was attributed to technological improvements.
That previous study, led by Stanford University post-doctoral researcher Mohmmad Masnadi and published in the journal Science in 2018, considered 2015 emissions data from almost 9,000 oilfields in 90 different countries and found that Canadian and Venezuelan heavy oil were among the world’s most carbon-intensive barrels.
Operators that flare large volumes of natural gas have higher emissions intensity. Photo by Andrew Cullen/Reuters files
Masnadi’s study also found that operators that flare large volumes of natural gas have higher emissions intensity. For example, Algeria produces the world’s lightest oil, but has the highest carbon intensity as a result of flaring.
Alberta Innovates chief executive Laura Kilcrease said in a release that the new study shows “that innovation has enabled reductions of GHG emissions in oilsands production and emerging technologies provide the potential for even greater results.”
The Canadian oil industry is widely expected to pour billions into emissions reducing technology in the coming years after Ottawa last week announced it would hike its carbon tax by more than 500 per cent, to $170 per tonne in 2030 from $30 per tonne now.
The effect of such an increase could reduce expected earnings by a minimum of nine per cent even at pipeline companies, according to a Dec. 13 research note from Stifel FirstEnergy.
“We view the potential carbon tax as a material headwind for the sector if passed and if there are few exemptions available,” Stifel FirstEnergy analyst Ian Gillies said in the note. “If passed, this would accelerate the need for investment in technologies to reduce GHG intensity.”
Gillies estimated that a carbon tax of $170 per tonne could impact 29 per cent of Keyera Corp.’s earnings before interest, taxes and amortization (EBITDA), making it the most exposed pipeline and infrastructure company to the new tax.
The l
east impacted companies would be Inter Pipeline Ltd. and Pembina Pipeline Corp., which would still see a nine per cent reduction in EBITDA.
Financial Post