A report released by S&P Global on Aug. 2 demonstrated a huge gap between Canada’s present emissions trajectory in the oil sands industry and the Canadian climate goals to reach a 40% emissions reduction by 2030.
The oil sands sector in Canada almost doubled in the past 10 years. In the next eight years, the country will need to reverse the trend if it wants to meet its climate targets.
The report, prepared by Kevin Birn, S&P Global’s chief analyst of Canadian oil markets, showed that despite the country having embraced CO2 capture and storage technology, a large-scale investment will be required to succeed in reducing emission within the timeframe.
“It is possible but it is incredibly ambitious,” Birn said. “And time is incredibly tight when you think about all the things that have to happen, and we don’t have a permitted project yet.”
According to the report, greenhouse gas emissions in Canada account for 700 to 730 million tonnes, a significant amount of emissions that data from 2019 showed was coming predominantly from the oil and gas industry (26%) and transport (25%).
The transportation sector is already transforming as Canada’s federal government has mandated that by 2030 all cars sold should be zero-emissions.
Opinions on how to regulate the oil and gas industry, however, still differ. Canada’s plan for 2030 is to reduce oil and gas emissions by 42% (81 million metric tons) by 2030. Oil sands currently bring emissions in the range of 68 to 84 million tons annually.
Pathways Alliance, which brings together the six biggest oil sands producers, has made a collective goal to cut 22 million metric tons of emissions by the end of the decade.