COP27 goes into overtime as Canada faces criticism on oil and gas

Article content

Environment Minister Steven Guilbeault, a former environmental activist who is seen as an enemy by much of the oil and gas industry, resisted heavy lobbying from India and other countries at the UN’s annual climate conference to sign a final agreement that would commit signatories to a complete phaseout of fossil fuels.

Article content

In response to a question about Canada’s position on the phase-out language, Guilbeault said on Nov. 17 that the provinces and territories, which have jurisdiction over natural resources, would likely mount a legal challenge to any attempt to oil and gas production — something that Ottawa would prefer to avoid.

Article content

That position generated criticism about Prime Minister Justin Trudeau’s commitment to fighting climate change. The following day, Guilbeault deflected questions about his remark during a virtual press conference from COP27, saying that such language wasn’t even on the table, but he didn’t try to reverse his position.

“I would like to point out that there is no such text,” Guilbeault said. “But we support reducing our dependencies on fossil fuels. The very foundation of our climate change plan rests on that, which is why we’ve adopted a law to ban the use of coal-fired electricity in Canada by 2030, we’re putting in place measures so that 100 per cent of vehicles sold in Canada will be zero-emission vehicles by 2035, our electrical grid will be net-zero by 2035. All of these measures, and many more, will lead to a significant reduction of our consumption of fossil fuels and therefore our dependencies on fossil fuels in Canada. And we obviously support that. That’s what we’re here for.”

Article content

As the COP27 talks in Sharm El-Sheikh headed into overtime over the weekend, government officials and negotiators remained divided over key issues, including funding for “loss and damage” to vulnerable countries suffering adverse impacts from climate change, and the implementation of rules governing global carbon trading.

On the sidelines, non-governmental organizations, activists and industry lobbyists have been watching closely as Canada pushed its priorities going into COP27 around methane reductions, the phasing out of coal power generation, and carbon pricing — while also absorbing intense criticism as the world’s fourth largest oil-producing nation.

Pembina Institute executive director Chris Severson-Baker said Canada managed to credibly talk about its success in retiring of coal-fired power plants, and won praise for its leadership on methane emission reductions, but fell short when it came to offering specifics on its plan to reduce pollution from oil and gas.

Article content

“That’s the biggest source of emissions in Canada,” Severson-Baker said. “It’s the one that people in the international (community) point at and say, ‘you’re telling us what to do on greenhouse gas emissions, but what are you doing about that big sector? Where’s the actual plan to reduce emissions from the oil and gas sector?’ And we don’t have an answer for that yet.”

Keen to participate

Nevertheless, the sector was keen to participate in this year’s COP discussions in how it could help meet climate goals. Canada’s delegation included a number of representatives from Canadian oil and gas companies and advocacy groups, including pipeline companies such as Enbridge Inc. and oilpatch majors such as Cenovus Energy Inc. and Imperial Oil Ltd.

Article content

Globally, there were more than 600 fossil fuel lobbyists in attendance, a 25 per cent increase over last year, according to some estimates.

Including the industry responsible for such a large share of emissions in talks about solutions to achieving decarbonization is only practical, the industry and some provincial political commentators argued.

“There is a bit of a misperception from some NGOs about what we’re doing there, that we’re somehow there to influence the negotiation, reduce climate progress, which is far from the case,” said Mark Cameron, vice-president of Pathways Alliance, a group representing Canada’s six largest oilsands companies. “We weren’t really involved in anything that was going on in the negotiations, we were basically there to tell our story and learn from others. That was the purpose of us being there.”

Article content

The Pathways Alliance, which has set a goal of reaching net-zero by 2050, organized a panel discussion at COP27 about decarbonization in the oilsands and met with other industries working on carbon capture technology to discuss approaches and financing.

Existential threat

The Canadian oilsands, and much of the country’s oil and gas sector, face an existential threat in the form of Canada’s promised oil-and-gas emissions cap. The sector is urging Ottawa to facilitate its decarbonization through incentives and credits and assurances around carbon pricing, rather than a hard cap on emissions. Guilbeault said this week that Ottawa will make a decision on the design of the cap by the spring and regulations could be in place by the end of next year.

Article content

Ottawa has so far resisted calls from environmental groups to impose a production cap on the sector, but an emissions cap that’s too rigid would effectively function as a cap on production, the industry has argued.

“(The problem is) if you have an emissions cap that is so stringent that there’s no way technologically that we could afford or manage to reduce emissions,” said Cameron. “Our plan, (which calls for a reduction of) 22 megatons (MT) by 2030 — that would be roughly 27 per cent of our current emissions for oilsands.

“Ottawa’s target is roughly 42 per cent (from current levels) by 2030. So that’s a big gap that we couldn’t meet. The 22 megatonne rule that we have is really a very extreme stretch goal that is going to take all of our effort to achieve. So we’d be 15 megatonnes short and the only way we could make that up would be a production cut.”

Article content

But critics of the sector have said there have been plenty of incentives from government to decarbonize and that it’s past time the industry show good faith by investing some of its recent windfall profits in reducing carbon emissions. However, the consortium of oil majors behind the Pathways Alliance have yet to make a final investment decision on the sector’s linchpin climate project, a massive $16.5-billion carbon capture network and storage hub.

Article content

Discussion around fossil fuels at this year’s COP have been complicated somewhat by a global energy crisis, exacerbated by Russia’s invasion of Ukraine, that have brought issues of energy security and affordability to the fore.

“The issue of climate change is super daunting,” Severson-Baker acknowledged when asked the value of the COP27 talks. “But at the same time, there’s a huge amount of political will to act. Money is being mobilized in the trillions of dollars and we’re seeing technological advances that are going to fundamentally change the way we use energy… so it’s one of these things where it’s incredibly daunting, and also incredibly inspiring and encouraging at the same time.”

• Email: mpotkins@postmedia.com | Twitter: mpotkins